Singing Machine Company Inc (MICS)

[Awl416]

Singing Machine Announces Distribution & License Agreement for Singing Machine Product Sales in the People’s Republic of China

[Awl416]

Poke it

[Monksdream]

MICS 10Q due March 5

[FlyingDutchman]

one fugly looking daily..later

[rado]

The Unicorn singalong backpack on Amazon is selling well, has 4.5 stars. But notice the Panda backpack is half the price. So it's all about the attractiveness of the stuffed animal in the backpack. I think this bodes well for an Elmo singalong backpack. I don't know if Sesame Street will be ready in time for Christmas.

[Monksdream]

MICS new 52 week low

[Triple nickle]

This can be fun today
A new shinny toy

[Triple nickle]

Lookin good pm

[AJ Freely]

$MICS - Up 26% Pre-Market/ Current Price $1.55
Announces Expanded Retail Presence with Walmart
Launching a new party accessory product line, now available at approximately 866 Walmart stores nationwide.

[Avidfisher]

He's probably shorting it.

[rado]

Sesame street toys

I can definitely see this helping the company out. Sesame street is an evergreen brand. They will probably make a singalong Elmo backpack or something. They did very well with their carpool karaoke licensing. I'd imagine this partner works out better. They seem on the verge of more dilution though.
https://finance.yahoo.com/news/singing-machine-launch-sesame-street-120000794.html

[rado]

I didn't see this coming. They had great real estate at Walmart this season. I did often see out of stock in various products like the party machine microphone, but expected that if Walmart had given them that space, then Walmart would also have bought enough product to stock in advance.

[hweb2]

Yep disastrous results for what is seasonally 1 of the 2 their strong quarters. I'm surprised the stock isn't down even more. No clue what NILE (apparently now the ticker is AULT) was thinking...buying up so many shares in a wild spending spree. MICS is a decent little company, but selling karaoke products into a recession is just not the place to be.

[rado]

What an awful quarter. $1.9M loss. Revenues down 66% for the quarter, down 18% for the last nine months.

https://finance.yahoo.com/news/singing-machine-reports-third-quarter-130000778.html

[rado]

Looks like Sam's club is carrying the duet pack of party machine mics. I think this should be beneficial as the small size allows them to pack much more product into a small shelf space. I have noticed the Party Machine mics moving at my Walmart. At first I thought they were a strange form factor, but they seem to do well.

https://mobile.twitter.com/NoAla_Trading/status/1597259739091853312

[rado]

Walmart really cleaned up their display. It looks much better. I can't tell if they are selling because they are keeping the area fully stocked now.

[rado]

Trending where? Strange action lately.

[Pt3]

Adding more tomorrow

[Avidfisher]

Why so dead in here when MICS #1 Trending?

[hweb2]

Similar thoughts here. Confusing that someone still has so many shares to sell, even after the NILE buying spree. And the diluted share count is much higher than I was thinking. The shares from yesterday's filing plus the NILE shares already puts us over 3.5M. So maybe the fully diluted share count is 4M-5M. Yikes I don't like it. Not hurting the stock today though!

[rado]

I see the list now. Seems like a bunch of shareholders who got a handout and are preparing to sell. I think they will sell.

[rado]

I didn't see this. I don't totally understand it. Who exactly wants to sell? Is it Gary Atkinson the CEO and one other person? And there is some reference to warrants. Are those new dilutive warrants? This wasn't PR'd so I'd guess it is not really known about. Maybe Gary is being kicked out. Maybe he wants to diversify his wealth. Many reasons to sell, but only one reason to buy. I don't like it though.

[hweb2]

What did everyone think of this filing yesterday?

https://www.sec.gov/Archives/edgar/data/923601/000149315222023995/forms-3.htm

Existing shareholders wanting to sell over 1.8M shares sounds like terrible news to me, but the stock is green so I guess I'm in the minority. Yesterday's filing raises so many questions. Was this a big middle finger to NILE? I thought it was strange they didn't mention their new majority owner on Monday's earnings report or CC. And what the heck is the share count? Closer to 4M now?? And why would you watch NILE buy over 1.7M shares since June...pushing the stock from the $3's to the $9's...and *now* you wanna unload a bunch of shares? Makes you wonder who was selling all those shares to NILE.

[NobleRoman]

That would corroborate those pictures of mine that showed complete neglect of our space at my local Target. Out of everything and kids' toys laying around in disarray.

I think you have a great stock here. Don't sell! I say that with no shares, but perhaps I'll be back in the future. I just exercised on my wish this morning:

10 QSR Jan 20 '23 $47.50 Call Exercised Aug 24, 2022 10:05 AM ET

1000 shares of QSR -- all mine now. Forever! I feel like a little kid on Christmas morning! I'm so excited.

I have other things on my wish list like Morgan Stanley and Taiwan Semiconductor Manufacturing (TSM). I need my dormant volcanoes to erupt, gosh doggit! I'm tired of waiting on everybody to move when all this value is out there.

[rado]

I listened to it, not super closely, but I didn't hear anything that stood out to me. I noticed one analyst was baffled how they could increase revenues >90% and still not earn anything, but it was all those one-time charges plus inflated prices. Bernardo seemed to suggest that Sam's was the customer that accelerated their orders. Also they said something about Target, but said something vague about issues with supply of their other products. At my local Target last time I checked there were no singing machines and only a few microphones, everything else was empty on that set of shelves. They have a lot of inventory right now and on a previous call they said it was recent inventory, so I think they have the product to give to the stores.

Nice to see NILE is still buying.

[hweb2]

Any thoughts on the call? I had it on earlier but was pretty distracted with other trades. Will try to give it a closer listen tonight.

Hey good news! Not only is NILE still buying. But they bought another 45,000 shares yesterday! I'm guessing the stock rebounds a bit on this Form 4 filing released after today's close-

https://www.sec.gov/Archives/edgar/data/896493/000121465922010494/xslF345X03/marketforms-56976.xml

[rado]

CC Replay is out

https://singingmachine.com/pages/events#/

[swampboots]

OT:NILE guy bought tons of his own stock near .36 ,now .29 and earnings minus .06 came out yesterday?

[hweb2]

Nice digging. I'm not sure but they usually have rather extensive conference calls, so we should get some details in the morning.

Stock tried to rebound a bit. Then it dropped .50 in the closing seconds. Weird. Guess that's the kind of move you get when the float is almost gone. Will be interesting to see if there's any Form 4 filings in the coming days. And whether NILE is continuing to buy.

[rado]

They are killing it on the microphones.
Microphones up (228%) now comprise 22% of the product line versus 12.8% before.
I was kind of skeptical of the Party Machine Microphone when I first saw it, because it is a somewhat unconventional product, but they seem to sell very well. Microphones are a much better business because the shipping costs with a karaoke machine has to be high with their large size and the store can only stock a few because of how bulky they are. But microphones fill a much smaller space and I'm guessing have higher margins, so kudos to them for developing the party machine mic (4.5 stars of 299 reviews on Amazon) and the podcast mic (4.5 stars of 4 reviews on Walmart).
The Kids Toys are now 8% of the product line versus 1% last year. I'm wondering if this is the new plush backpack microphone toy?


https://www.amazon.com/Singing-Machine-Karaoke-System-Portable/dp/B08GCYNS17/ref=sr_1_5?keywords=party+machine+microphone&qid=1661197758&sprefix=party+mach%2Caps%2C91&sr=8-5

https://www.walmart.com/ip/The-Singing-Machine-All-In-One-Microphone-Black-SMM2097/812827217

[hweb2]

No they're supposed to wait 6 months if they own over 10%. Otherwise those profits go back to the company. But since they own the majority of the company anyway, I guess they still benefit.

https://www.investopedia.com/terms/s/shortswingprofitrule.asp#:~:text=The%20short%2Dswing%20profit%20rule%20is%20a%20Securities%20and%20Exchange,within%20a%20six%2Dmonth%20period

[rado]

For some reason I had it in my mind that NILE couldn't sell until the end of the year. Are they able to sell now?

[hweb2]

Good points. Hopefully we'll get some clarity on the CC tomorrow. Of course overriding all of this is what will NILE do? If they're holding/adding, I'm guessing this low floater bounces back up quickly. If they start selling, we're headed lower. Volume is still fairly light today...considering the dramatic swings. Up over 20% premarket. Now down 20%.

[rado]

Looks like most of the ~$1M increase in SGA is one-time. That's a positive. One customer upped their timetable to receive more product up-front and the Walmart product was an initial order. Not sure how much Walmart ordered in advance, will they need to reorder much for the holiday season? The advance order could also cause the next quarter to be lighter. Freight ends up in cost of revenue and freight costs have been coming down, so that could improve in coming quarters.

"""
OPERATING EXPENSES
During the three months ended June 30, 2022, total operating expenses increased to approximately $3,034,000 compared to approximately $2,068,000 during the three months ended June 30, 2021. This represents an increase in total operating expenses of approximately $966,000 from the three months ended June 30, 2021. The increase in operating expenses is primarily due to an increase in general and administrative expenses of approximately $949,000. There was an increase in pallet expenses, warehouse supplies and expense and temporary labor at our California facility of approximately $262,000 due to an increase in third party logistics business, a one-time project associated with the initial product set in a major customer’s consumer electronics department (see NET SALES), as well as price increases due to inflation and supply chain shortages. There was an increase in legal, professional, investor relations and stock exchange listing fees of approximately $222,000 primarily related to the public offering and Nasdaq up-listing in May 2022 (see NOTE 12 -PUBLIC OFFERING AND NASDAQ UPLISTING). There was an increase in compensation of approximately $172,000 primarily due to compensation for new members of the board of directors and officers’ incentive bonuses. There was an increase in bad debt reserve expense of approximately $151,000 related to required reserves commensurate with the increase in net sales and accounts receivable. The remaining increase was primarily due to one-time ERP system projects, increases in costs due to inflation and increases selling and administrative variable expenses commensurate with the increase in net sales."""

[swampboots]

MICS 7.70 very few here but in after looong pause needed a tidy sime to channel trade this last month which I did not have.

[hweb2]

Gotcha I bought back a tiny amount of MICS when it went red this morning after being up sharply premarket. Wish I'd waited for the $7's but didn't think it would drop that much. Surprised it's down at all. Those quarterly results couldn't have been better imo. Now they've got their 2 seasonally strong quarters coming up. With potential big EPS given the very low share count. We'll see what they say on the CC tomorrow.

[NobleRoman]

Definite interest, and I think that would be a great buy. I'm just not going to for completely different reasons. I'd love to if money were not object. Just want to maintain a comfortable margin cushion. I have cash-secured puts, the majority of which don't expire until January. And I'd rather not close them out, because that would just cost me money to do so.

And, I recently bought another 1,000 shares of RMCF at $6.80 and another 10,000 shares of our common experience at IVFH at .25 just because of Pappas, Banderas, and the now disgruntled Denver Smith. And I had bought another 1,000 shares of PCYO after selling MICS, which is $11,000 right there. And bought more penny stock NROM.

So, the first two alone account for all the equity I had here prior with MICS. Plus the extra buys. I love MICS at this price. Just love everything else too. And want to keep a very safe margin cushion. Until one of my dormant volcanoes explodes eventually. Nothing against MICS though. Would love to have it also.

Of course, a drop below $4 would be irresistable and I'd just have to take that risk. Probably could raise that to anything below $5 after tjhis quarter. But, yeah, this price at $8 I think is very fair.

[hweb2]

Any interest in buying back below $8? With such a tiny float, seems like a good shot at another spike to $10+ in the coming days/weeks if the broader markets don't crumble. Assuming NILE doesn't start selling. Can't imagine they would after today's positive report.

[NobleRoman]

Fantastic quarter! I was stuck in doctor's office for annual checkup and couldn't comment. Surprised at the pullback too, but I imagine that is due to the entire market being down. Dow dropping 400 points against this backdrop doesn't help.

Ault's mystery projections of $52 million annual sales could have been a forward projection which didn't occur to me. Now that number is suddenly very doable. All those fears of recession were erased by Wal-Mart, as I was saying. This is a good beat to overall common sense expectations. Blowing our normal 1st quarter sales precisely because of these new deals, which is what I've been saying on the record.

I'm not in the stock, of course. IFFF I had my 1,000 shares, I would have only experienced a max of $2000 paper gains in the beginning of the day. And who knows what at close. Good fundamentals though.

[hweb2]

Well here's another chance at the $7's ha. I'm surprised to see the stock down almost 20% after a GREAT quarter. And it was surging premarket too. Think I saw a high of $13!

[swampboots]

MICS: those 7's were nice, if I bought.

[hweb2]

Hey great revenues reported this morning. I figured they'd be up with the expanded Walmart deal, but not up 92%! Especially with the delayed report. Unfortunately they still lost money because of the seasonality. Stock has run up into the Q1 numbers, but the excellent Q1 revenues might be enough to kick it higher.

https://finance.yahoo.com/news/singing-machine-announces-92-increase-101500877.html

[swampboots]

MICS: We can mint a meme when we have none!

[hweb2]

With the lack of float here thanks to NILE, I can see MICS becoming a meme stock in this super frothy market. Why I always thought it was dumb to be short. If the meme crowd shows up...who knows how high this flies...$20's, $30's, $40's

[rado]

MICS 9.45+1.20 (+14.55%)

Perking up today.

[hweb2]

I think it was more this Costco news this morning-

https://finance.yahoo.com/news/singing-machine-launches-flagship-karaoke-120000914.html

Market seems to like MICS today, whatever the reason. Guess nobody is concerned that earnings are also due today.

[swampboots]

MICS: 9 -the short list PR caused a small pop.

[swampboots]

Again 400K spent on his home base stock (NILE) despite history of porous dilutions?

[hweb2]

Noticed a couple more small NILE buys-

https://www.sec.gov/Archives/edgar/data/896493/000121465922009735/xslF345X03/marketforms-56835.xml

Also the short interest continues to slip lower-

https://www.nasdaq.com/market-activity/stocks/mics/short-interest

Curious to see the reaction to earnings in a few days. I don't think it'll be a great report, although revenues might be up thanks to the expanded Walmart deal. Not that it matters much...NILE is firmly in control here.

Broader markets soaring again today. With the float almost gone, I'm surprised traders haven't discovered MICS yet. Assuming these frothy market conditions continue, seems like only a matter of time before they gun this one higher.

[swampboots]

MICS teasing me with no 8's today, I'm at almost.