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Very encouraging. I'm guessing small value HF's and money managers initiating positions or averaging down. Company very quiet so may not get news until Q2 report in August. We'll see.
Good to see somebody thinks it's cheap and is pushing the price. Congrats to those of you who bought more below 4. I already had a full position with an average cost just over 5. One good PR could get us back there unless the market tanks in the interim.
Ouch! 3.95 on the ask. I'm hoping that the selling stops at the end of June when institutional money market accounts have their quarter end. There could be some last significant dumping this week. We'll see.
Elizabeth Warren has a similar proposal for canceling student debt. It was enough to get my graduate student son who has racked up about $30,000 to support her candidacy.
I think the small shares is the trading algorithms that institutional brokers use for thinly traded shares
For us individual investors who are underwater it doesn't have professional implications. For institutional investors, if you're recent and still building a position you may be happy, or at least willing, to average down. If you have a full position at an average cost of $5-6 per share or higher, it's very risky to continue buying and very possibly compounding your losses. You also don't want a big loser in your portfolio in your end of quarter reports. I think this type of purging is driving the price down.
If they're close to cash flow positive, why not announce a modest stock buyback program? Would seem like a great use of even scarce cash at this point.
Dave--Do you think odd they're having cc while market is open?
It does have the feeling they're hiding a dead body and desperately trying to figure out how to make it public. Just my imagination running wild of course.
Looks like they'll just issue a q1 PR are followed by a conference call the next day.
Wow Kik. Another win. You're the NE Patriots of PSL.
I'm wondering if today's dry heave selling is because another equity round seems increasingly likely. I don't think Sams would do that lightly as he would lose majority control of the company.
TNX is the Yahoo Finance symbol for 10 year Treasuries. Usually bullish indicators cause a sell off and the yield rises. Today the yield is declining. To me it indicates that the recent equity rally is prompting some to a more defensive posture which is bidding up Treasuries.
Surprised TNX is down after strong Q1 GDP growth
My WAG is that they preannounce a production snafu related lousy Q1 revenues but a big backlog as of the date of the PR. They're waiting to preannounce Q1 until some pending orders come through to bulk up the backlog. Stalling production in itself would cause backlog growth to accelerate.
Cliff please check your irrational exuberance
FTSI Don't see any news. Any thoughts why it's spiking today?
Even though some of my posts have been negative, I continue to hold as well.
Can't tell whether someone is seeing a buying opportunity or some fed up seller is finished puking up his shares.
Skillz--Does CCEL qualify yet?
As important as they may be longer term, it irked me on the cc that Sams was gushing about new products to be launched this year when they're still flailing with domestic manufacturing and international sales. His colleague had to step in and caution that they haven't even shown those products to anyone much less received any orders. Sams should head up R&D and let someone else run the company who's laser focused on delivering near term results.
Regarding margins, now it's not only labor and material costs, tariffs etc but they specifically acknowledged pricing pressure from Tier 1s. It's really not surprising that a competitor almost anywhere has lower production costs than a factory in Southern California. I don't blame management for pricing pressure but the value of the company is materially affected by it, and management can't really "fix" it unless their design innovations give them some pricing power.
POLA--Earnings hold didn't turn out well. Think the decline is justified due to little in the way of forward guidance and tepid enthusiasm from management about the first half of 2019.
Listened to the conference call. Seemed clear they're struggling with manufacturing ramp up which will constrain revenues at least in Q1 and hurt margins until 2nd half. Since the vast majority of their business for the next 1-2 years will be from Tier 1s, their acknowledgement of price concessions is a concern that could continue to hurt margins even when they optimize their manufacturing costs.
I understand why they want their backlog to be $8-$10 million and deliverable in 60 days. Given that, it seemed weird they wouldn't say what their current backlog is but are going to PR it soon? Perhaps they just mean their Q1 earnings release in early May.
Sams seems enamored with new products and markets but with not much of a handle on current execution. They can't even keep up with their Tier 1 orders but he thinks it's important to build a full service presence in South Africa? From what I've seen so far, I would deemphasize international and focus on domestic where the opportunities are far greater than their current manufacturing can even accommodate. I could see domestically over time that lower margin Tier 1 orders would be deemphasized as higher margin military and domestic products gain traction.
Regarding their balance sheet I think the big question is when they will again need to again increase production capacity and how that will be financed. If they're doing $60 million in revenue a year on good margins and are solidly profitable they can probably borrow, but if margins are poor and expenses (eg international expansion) are too high, they'll have to do an equity round.
IMO, which admittedly is very subjective, I heard management sound less confident about delivering this year and struggling to get a handle on profitable growth.
POLA perking up today before reporting tomorrow pm. We'll see.
Wadirum--Your buyout theory is logical except that POLA is the CEO/Founder's baby he's been nurturing for decades. I think he has a vision he's chasing and doesn't care about selling for a profit or even driving the near term stock price.
Since this Board appreciates whining, I hate it when I'm on the ask for days with no hits, get joined by another seller at the same ask price, immediately there are a flurry of hits at the ask, and none of them are my shares.
Does CCEL qualify yet?
FYI I still own my shares even though I'm not as much of a bull as I was. Still think they're worth much more than $5.
Also the CEO founder has been nurturing POLA along for decades. While he's very committed and the IPO and Tier 1 orders are an obvious inflection point in the company's history, I think he has a long term h share price because the costs of global expansion and product R&D will weigh on earnings.
While it's logical that $10million + in quarterly sales will improve margins, I get the sense that they don't really know and are figuring out the expenses of ramping up as they go. Ramping up efficient manufacturing is specialized and tricky especially if multiple products and facilities. Not predicting lower margins but do think it's a material risk.
Does CCEL qualify?
Sold my HCLP and FTSI today at close to today's highs. Took about a 15% loss on each despite their recent gains as I initially bought them in early December and continued to average down but not enough to bail myself out given their steep decline. I would have hung in longer except needed to raise some cash, and they were my most liquid positions. Also, thought I would take advantage of their big run today.
FYI posted on another Board:
I would say mildly disappointing Q4 update in that they still seem to be having some growing pains getting their expanded production facilities up to a profitable quarterly revenue run rate of $10+ million despite the backlog to do so.
I also found their 2019 outlook of "positive revenue growth" to be less than inspiring. Even if they average only $8 million of quarterly revenue as they achieved in Q4 or $32 million for 2019 that would amount to "significant" 33% positive revenue growth over the $24 million in 2018. Why give such a tepid vague revenue outlook at all? Don't think that was very well considered.
I think their backlog will be driven by the procurement policies/schedule of their Tier 1 telecom customers who probably won't see much point placing orders that can't be delivered within 6 months. As long as their backlog maintains at a level like it is now that allows them to operate at maximum capacity (once they get past their operating capacity expansion kinks), I consider it to be healthy. Their Tier I business is a great foundation off of which to grow their other business.
They spoke to improved margins in the 2nd half of 2019. But to achieve higher earnings, I think they need both to get production up to capacity and to generate material "non Tier 1" business--international and/or military. At this point with only negligible international revenues and significant international marketing costs, I think good profitably for the 2nd half of 2019 depend on significant new international orders. Otherwise, international costs will continue to squeeze earnings.
Overall, I see why the market isn't really responding to the PR today as this has become more of a "steady Eddie" long term growth story than a near term exciting explosive growth story. Given the increasing risk that the overall market is getting "tired" and increased recent volatility, I think it's harder to justify a stock position that in the best case is likely to require a longer term hold.
POLA KIK I would say mildly disappointing Q4 update in that they still seem to be having some growing pains getting their expanded production facilities up to a profitable quarterly revenue run rate of $10+ million despite the backlog to do so.
I also found their 2019 outlook of "positive revenue growth" to be less than inspiring. Even if they average only $8 million of quarterly revenue as they achieved in Q4 or $32 million for 2019 that would amount to "significant" 33% positive revenue growth over the $24 million in 2018. Why give such a tepid vague revenue outlook at all? Don't think that was very well considered.
I think their backlog will be driven by the procurement policies/schedule of their Tier 1 telecom customers who probably won't see much point placing orders that can't be delivered within 6 months. As long as their backlog maintains at a level like it is now that allows them to operate at maximum capacity (once they get past their operating capacity expansion kinks), I consider it to be healthy. Their Tier I business is a great foundation off of which to grow their other business.
They spoke to improved margins in the 2nd half of 2019. But to achieve higher earnings, I think they need both to get production up to capacity and to generate material "non Tier 1" business--international and/or military. At this point with only negligible international revenues and significant international marketing costs, I think good profitably for the 2nd half of 2019 depend on significant new international orders. Otherwise, international costs will continue to squeeze earnings.
Overall, I see why the market isn't really responding to the PR today as this has become more of a "steady Eddie" long term growth story than a near term exciting explosive growth story. Given the increasing risk that the overall market is getting "tired" and increased recent volatility, I think it's harder to justify a stock position that in the best case is likely to require a longer term hold.
We don't seem to be swept up in the current surging market. Sure would be a good time to announce expected Q4 revenues even if audit still not completed.
HCLP on a tear after announcing earnings date. Not sure what's inferred to be positive. Market may be reflecting the widespread desire to bring me back to respectability in PSL 4.
NRZ Although not true today I think has traded up along with rising interest rates so has been negatively affected by their recent pull back. They invested heavily in mortgage service agreements which appreciate when interest rates rise and mortgage refinancings decline.
FTSI How bullish does a $12 price target look now! Funny because it would have looked bearish just a few weeks ago. Given the high institutional ownership I doubt much tax loss selling happening with FTSI. However, I do think institutions tend to sell off their losers in December so their year end (and beginning of the new year) portfolios don't feature holdings that have tanked.
They're speaking at conference now. We'll see if it sparks any buying interest tomorrow.