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Intuit, Inc. (INTU) Message Board

roboklerk 104 posts  |  Last Activity: 20 hours ago Member since: Feb 2, 2009
  • to poke, other than the stupid, near-sighted tax policy of the U.K government. Will know in two months if Hess re-ups on the WilHunter for another 275 days, after yard work, beginning in early 2016. I bet they will. But if they do not, Awilco has more than a year to figure out another job for the Wilhunter. They can direct all their efforts to that one rig--it's not like they have to find work for a whole fleet of rigs. These guys running the company strike me as smart and not letting anything fall through the cracks every time I listen to them on the CCs. , including making adjustments to get the recently increased tax rate to get it lowered by early next year. It's nice to have a company that is nearly completely transparent. I say nearly, because I bet they have some conditional "backstops" or alternatives under consideration that they keep close to the vest. I have no doubt they would be totally directed to enhancing shareholder value.

  • Reply to

    10Q details

    by pa1702 Aug 13, 2014 4:10 AM
    roboklerk roboklerk Aug 13, 2014 8:21 PM Flag

    Then add the value of the spas, banquet facilities, tennis courts, swimming pools, the hotel, etc. And I'm not even assuming there is oil or gas under the ground. I realize asset value or liquidation analysis is a different exercise than P&L profitability or cash flow analysis to which line assigns a multiple. Just saying there is more than one way to look at the value of a business. If they do it right, and it becomes a first class all-inclusive resort then you get intangible value as well beyond the physical assets in place. I like to think of that as Destination Value. If they do it right is a big qualifier.

  • Reply to

    10Q details

    by pa1702 Aug 13, 2014 4:10 AM
    roboklerk roboklerk Aug 13, 2014 8:16 PM Flag

    On the other hand an April 17, 2014 Businessweek article cited the average sales price of a regulation golf course at $4.25 million in 2013 up from $2.7 million in 2012. Separately, the USGA says that average construction costs for a golf course ranges from $1.6 to $4.5 million, but the actual total cost of putting a golf course on line frequently exceeds $10 million (e.g. pro shop, maintenance, ranges, instruction facilities, golf swing analyzers , ancillary buildings, etc.). AWX has three 18-hole golf courses and my understanding is that they are not the average middling type of courses w/no frills.

  • Then after all that stock got turned over since the last earnings report, it just drifted back down into the terrible $2s. Still plenty of supply for sale. No idea where it is coming from. See no Form 4 or 13D or 13G filings at all. Bit of a mystery. Retail doesn't typically decide to get out all at the same time like that, but no institutional or insider filings, hmmmmmmm.

  • Reply to

    Laughable results

    by barnyzebo45 Aug 11, 2014 10:25 AM
    roboklerk roboklerk Aug 13, 2014 1:30 PM Flag

    they already have a reserve against doubtful accounts. Plus, the only good thing you can say about the government is that they are pretty good at paying their bills to companies that serve them. That assumes most of the receivables are coming from them. The more important question is what the government spend off will look like into fiscal year end, and how much of that PESI will get.

  • Reply to

    What An Awful Stock

    by hansy_burkhalter Jul 21, 2014 3:53 PM
    roboklerk roboklerk Aug 13, 2014 11:44 AM Flag

    falling knife.

  • Reply to

    10Q details

    by pa1702 Aug 13, 2014 4:10 AM
    roboklerk roboklerk Aug 13, 2014 10:00 AM Flag

    Gotta fully expect the next 12 months to be transitional.

  • Reply to

    another cruddy quarter

    by hokey_pokey49482 Aug 12, 2014 5:50 PM
    roboklerk roboklerk Aug 12, 2014 6:27 PM Flag

    Small loss--pocket change-- but good cash flow (from operations) generation in the quarter. Follow the cash flow. More important than the quarterly results, they increased the credit line from $1 million to $5 million and borrowed the money to pay for the hotel purchase. Debt won't get much cheaper than it is today. Could have easily financed the purchase w/cash from the balance sheet but chose to borrow. Like the move. They want to grow the company while money is cheap and not stand still. I'd like to see them sell the waste disposal business (but keep the injection wells), as it is highly variable and project dependent. The costs contract when that business segment contracts so it's not a big swing factor in profitability; I just find it kind of an annoyance. Gotta look ahead to what the company will look like in 12 months when the resort is updated, They need to stay on schedule w/the improvements to take advantage of seasonality from mid-summer through fall next year.

  • Reply to

    Laughable results

    by barnyzebo45 Aug 11, 2014 10:25 AM
    roboklerk roboklerk Aug 11, 2014 7:42 PM Flag

    Pro forma cash is more like $5 million, giving effect to the insurance proceeds and recent asset sale. Now they paid down the revolver subsequent to the quarter's end, and a little more is also pledged against the debt held by PNC, but they should still have almost a few million dollars available for working capital, w/ an available draw of another $7 million on top of that. Plus the last half of the year is projected to show positive EBITDA of at least a few million dollars. So cash is not a problem, and they are in decent shape financial liquidity-wise w/o having had to sell any equity to raise proceeds.

    They missed cash flow (EBITDA) break-even for the quarter, due to timing of some late shipments that will boost 3Q results. But the point is there is no excuse, they missed the number by a little. It is not a big deal in my mind, but it is a little deal and cannot be dismissed because it goes to management credibility. That's why the stock eased a bit in an up market today. Notwithstanding (and understanding) that, revenues and EBITDA did turn pretty strongly from depressed Q1 levels and probably mark an inflection point. I like buying inflection points. I especially like buying them when others sell out of frustration. Like I said, the frustration is completely understandable, but selling the stock is wrong-headed. The ducks are lining up in a row for the next 12 months, hopefully longer. The important and understated point on the CC today is that some (perhaps much) of the competition has fallen by the wayside (due to bumbling government policy over the last few years IMO). The company is not blameless due to a bad acquisition (SEHC) and they could have moved quicker to reduce costs. But once they did move, they have moved forcefully in that regard. The second most important point on the CC is the operating leverage that exists when and if the turn comes. No small/microcap cap fund is going to double down in this market, but they probably should.

  • roboklerk roboklerk Aug 9, 2014 10:25 AM Flag

    Investors may have tempered their expectations on the Helix story, not the Helix technology itself (which seems sound and amazing), but the story of how it impacts the company and its financials. It will be a technology that is gradually introduced in -phase over a number of years, that has some incremental positive impact as it cannibalizes PRCP's existing technology in field at a bit better margins and produces some gains in share of market in a highly cyclical industry. It will probably not be a massive, all-at-once blockbuster rollout of new technology that is purely additive (because it will largely replace) to what currently exists at rapidly expansive margins typical of disruptive companies. New first time orders for the technology would brighten that outlook further, but that is tough to project w/o guidance. The stock could grind higher over time as Helix works its way into the mix and subsequent software upgrades are introduced. The other factor at work is that small cap funds got absolutely slammed in July and there has been significant pressure to adjust asset mix and raise cash. Some fell as much as 7% in the last month (the Russell 2000 was down over 6% in July). Forget the overly bullish SA articles and rein in expectations to an average 8-10% annual return including the dividend over the next five years and you might be ballpark. If it exceeds that, you will only be happier still. Cyclical companies don't get big PE multiples on peak or even normalized earnings.

  • Buy now, or just wait for 2Q results and guidance in a week? They have nice contracts through the presumed weak period for floaters over the next 2-3 years. Question is what will the state of the mid-water semi market be by early 2017? Some analysts are looking for the cyclical downturn to last at least three years. But Awilco has a nice niche, relatively well protected.

  • Also liked the comment about increasing market share, although it feels like they are increasing their market share of marketable securities, primarily. That's ok.

  • don't have a problem w/that. It's a quintessential "Rip Van Winkle" stock.

  • Reply to

    How does one get away with making a major purchase

    by pa1702 Aug 4, 2014 4:26 PM
    roboklerk roboklerk Aug 5, 2014 1:06 PM Flag

    8K filed. $3.1 million cash plus lease assumption. Plus the PR previously disclosed a "multi-million dollar" expansion of the facilities. So that ain't going to leave much, if anything, for future injection wells. I'm ok w/that. I don't want to worry about the outcome of referendum votes on fracking every six months. They have the two injection wells permitted, operating, and presumably grandfathered. It took nearly forever to get them on stream, and I am sure management had more than enough " fun " w/that process. Hopefully they add a bit of free cash flow annually. Eventually, maybe you sell and turnkey them over to someone else at a profit. So you have a 144 room hotel, but the story will be more about how much each visitor spends on golf, tennis, spa, dining, swimming etc. Or alternatively, how much of that gets added to the room charge in a package. If the property ends up being a truly attractive, one-of-a-kind vacation complex (say like South Seas Plantation on Captiva Island), more than one or two PE entities will be following it. There's just something about real estate, new or well-maintined real estate. It remains to be seen if it becomes a hot, must-go-to destination. I happen to love the Midwest. Not everyone does. Maybe as a shareholder I can even get a free night, or at least a golf pass for the day next time I pass through Ohio.

  • Reply to

    profitable quarter??

    by selllowtome Aug 2, 2014 6:44 AM
    roboklerk roboklerk Aug 5, 2014 10:58 AM Flag

    They have been dancing around the debt issue. They have gotten waivers, reworked the covenant formulas, gotten special dispensation to access funds and sell some assets. The forest for the trees here is that we are talking about maybe $15 million worth of debt overhanging a company w/replacement value well into the hundreds of millions. Not that $15 million of debt couldn't bring a company down, it could. But we are not talking about some companies in this sector that have had much bigger issues w/hundreds and hundreds of millions dollars of debt on the balance sheet. We are talking about $15 million. That is not an unsolvable problem, and could be eliminated or re-worked any number of ways. It might involve a little dilution, it might not even be necessary if the contract flow resumes. But basically the company should stop "monkeying around w/it", nibbling at the edges, and take the issue out of the market. I'm sure there is at least one PE guy out there w/$15 million in his pocket as chump change that would listen to PESI's story.

  • Reply to

    How does one get away with making a major purchase

    by pa1702 Aug 4, 2014 4:26 PM
    roboklerk roboklerk Aug 4, 2014 6:07 PM Flag

    I had thought the same thing. If it is a material event and the acquisition has been completed, an 8K has to be filed. He can have as long as four business days to file the 8K, but in some cases if it is filed just to comply w/ Reg FD disclosure, I believe it may have to be filed earlier. How much substantive information is required to be included I am not sure. I would think the purchase consideration at a minimum, but maybe not the projected additional cost to expand and upgrade and integrate the hotel w/current operations. Bet on as late as possible a disclosure w/as little information as possible---but I think we will get something soon that includes the purchase price. Then we need some smarty pants hotel guy to tell us if the price paid per room was a deal, and how much annual revenue per room is a fair expectation.

  • roboklerk roboklerk Aug 4, 2014 9:52 AM Flag

    Well, it's a fairly bold move and if the public market doesn't buy into the idea w/higher stock valuation, there's a decent chance he just takes the company private IMO. I think in the $3s range, with him owning over 20% of the company and about half the company's value already there in cash, combined w/ a small number of shares outstanding, it makes sense. I really think Klingle may not care at all what the public market thinks at this point. He knows what he has and probably has his own growth (and ultimately, exit) strategy. Since he's debt-free, he is also free to pursue his own agenda pretty much unencumbered.

  • Reply to

    profitable quarter??

    by selllowtome Aug 2, 2014 6:44 AM
    roboklerk roboklerk Aug 2, 2014 8:20 AM Flag

    If it were me, my next step would be to try to re-fi the current portion of long term debt or get it re-classified as long term.

  • Reply to

    profitable quarter??

    by selllowtome Aug 2, 2014 6:44 AM
    roboklerk roboklerk Aug 2, 2014 8:15 AM Flag

    Re: Isotope funding, they have possibly missed the window for this year. All of Europe goes on vacation the entire month of August, and given the pullback in worldwide markets, especially Europe the last six trading sessions--I just don't see capital being raised there any time soon. Europe is at serious risk for a deflationary event as the ECB diddles. Good news is the co. has been raising cash by getting a release on most of the insurance proceeds and a small asset sale. Bad news is if you look at the negative working capital--they needed to raise cash. I'm not sure they have reached cash break-even on an operating basis, but selling a money losing operation and releasing personnel gets them a bit closer. I see them as still needing a little more cash and a possible further re-work of terms w/PNC although that was not mentioned in the 8K related to the asset sale and is just my supposition. It's probably workable as they are close to pulling themselves out, but they are still "dancing on the head of a pin, at least near term. They are just going to have to grind it out and hope for more contract flow. Insiders own a lot of stock, so they should be well motivated.

  • Reply to

    Ouch...

    by bigbear.2010 Aug 1, 2014 10:30 AM
    roboklerk roboklerk Aug 1, 2014 5:05 PM Flag

    Actually, the sixth consecutive daily decline for this one. It is totally tracking Euro markets. I almost bit today, but figured I didn't want risk a buy ahead of the weekend (like every other fraidy-cat investor out there) and really want it a little cheaper. That's probably being very penny wise and pound foolish. If it opens at $25+ on Monday it will serve me right. Euro markets are really freaked by the Ukraine crisis, but it only makes the area Awilco operates in (U.K. sector of the N. Sea) seem that much more secure and attractive for operators. The selling is all knee-jerk, or more likely an institutional holder simply wanting or being forced to be more liquid w/cash. You sell what you can. The ECB is truly risking pernicious deflation by having not put forth an aggressive QE package. No matter, Awilco has long term contracts. Comfortable for 3 years, hoping for 10-12 years of nice payouts.

INTU
82.66+0.02(+0.02%)Aug 27 4:00 PMEDT

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