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FTSI so far the worst trade I can ever recall making over a few days on no company specific news. After initiating position at 9.99 on 11/26 I continued to average down with multiple buys culminating in my last buy on 12/4 at 9.03 for an average cost of 9.39. Now down 17% in just a few trading days. Same story on HCLP except it's down "only" 8% from my average. I knew they were both volatile stocks in a volatile sector, but if somebody predicted a few days ago that FTSI would trade in the $7s, I would have thought they were delusional doomsayers. Nothing like trading stocks to get a regular dose of humility.
FTSI--Couldn't resist buying 2000 more at 9.03. Now waaaay over skis at average cost of 9.39.
HCLP and FTSI-- Bought more to average down to 9.47 and 5.79. Not buying anymore.
HCLP and FTSI both getting annihilated. Trying to decide whether to keep averaging diwn.
HCLP Now averaged down to $5.96. Price of oil not cooperating.
Sorry, my bad, so they said "significant amount" of backlog to ship in Q4 not "most". Less than half could still be considered a significant amount.
I thought they said "most" of the backlog would be delivered in Q4 which will make for a record Q in any case.
Separately, whoever had wind of that PR and bought in advance must have been disappointed by the action yesterday. Serves them right.
Good volume today off PR. Could be tax loss selling for longer term holders figuring this is the best chance before year end. Despite sideways price movement I consider recent volume to be bulliah.
HCLP Bought more at 6.21
Notice the higher volume the last two days before this PR release. Looks like there was some anticipation of it.
POLA KIK Since you asked here's my post from POLA Board:
Glad they issued PR and are proactively and responsibly promoting their progress. However an additional $4 million in backlog from their last report doesn't materially change the story. Also glad to see the first real international orders but they're modest and hard to know how quickly they'll ramp up. Not being negative but just making the point that there's not enough "new news" in the PR to expect the stock to fly.
Glad they issued PR and are proactively and responsibly promoting their progress. However an additional $4 million in backlog from their last report doesn't materially change the story. Also glad to see the first real international orders but they're modest and hard to know how quickly they'll ramp up. Not being negative but just making the point that there's not enough "new news" in the PR to expect the stock to fly.
PERI was a big winner for me. Now in the red. Only sold a little around time of reverse split.
HCLP Reentered at 6.44. Despite frac sand glut seems cheap here with 14% yield if they hold dividend.
FTSI Reinitiated a position at 9.99
POLA FYI Southacresdave has uncovered some interesting new data points on the POLA board. I bought more in the 5.40s this morning. There's certainly execution risk but they've established a growing pipeline for their products.
HCLP Sold the remaining 60% at average of 7.75. May go higher but given huge run last two days couldn't resist. Would buy again if it falls back.
There are so many moving parts it's silly to try to predict earnings. However, if you assume $10 million in sales, 30% gross margins and the same SG&A expenses as in Q3, I think that generates about .08 EPS.
FWIW I posted this on another board:
Q3 another case of "glass half full/empty". Disappointing sequential revenue growth due to disruption of engine supply because of tariff wars. Could management have better managed/diversified supply chain? Who knows but on their CC several analysts spoke to similar disruptions at other companies. In any case, they said the issue is past now, and their production is back on a good track.
On the bright side, in part because of fewer deliveries in Q3, their backlog at November 9th was a whopping $15.2 million most of which they implied on the conference call would be delivered in Q4 (in addition to Q4 deliveries up to November 9th). So Q4 revenues should be huuuuuuuge at +$10 million--by far the largest in the company's short history.
Given increasing costs because of expanding production, product development,international sales, fluctuating gross margins and possible year end bonuses, Q4 EPS are difficult to predict but, assuming 30% gross margins should at least be .05 which admittedly wouldn't drive the share price. I'm still a big believer that will continue to grow revenues quickly next year even in a slowing global growth environment.
The biggest negative IMO is that we now have to wait about 4 months to hear of Q4 unless they issue an earlier PR. Last year they reported Q4 on March 8th. This is a pretty scary market to initiate a position in a thinly traded stock where there could be no stock driving news for 4 months. That said I bought a little more today at $5.45 to add to my current already sizable position .
I do feel management is committed and capable, but the founder/CEO/majority SH is a dorky engineer who is anything but slick on CCs. One concern I have is that he's mostly focused on building the company and isn't focused on strategies to promote the share price--hence the lack of institutional ownership and low trading volume. He might also be more focused on developing cutting edge products (e.g. solar and NG generators) to go along with his core products than on generating high profits. That said he owns more than half of the stock so should have every reason to care about the share price.
HCLP Matt, while some opinions posted may be more thoughtful than others, the only real idiocy IMO is when somebody is sure they're right.
POLA Q3 another case of "glass half full/empty". Disappointing sequential revenue growth due to disruption of engine supply because of tariff wars. Could management have better managed/diversified supply chain? Who knows but on their CC several analysts similar disruptions at other companies. In any case, they said the issue is past now, and their production is back on a good track.
On the bright side, in part because of fewer deliveries in Q3, their backlog at November 9th was a whopping $15.2 million most of which they implied on the conference call would be delivered in Q4 (in addition to Q4 deliveries up to November 9th). So Q4 revenues should be huuuuuuuge at +$10 million by far the largest in the company's short history.
Given increasing costs because of expanding production, product development,international sales, fluctuating gross margins and possible year end bonuses, Q4 EPS are difficult to predict but, assuming 30% gross margins should at least be .05 which admittedly wouldn't drive the share price. I'm still a big believer that will continue to grow revenues quickly next year even in a slowing global growth environment.
The biggest negative IMO is that we now have to wait about 4 months to hear of Q4 unless they issue an earlier PR. Last year they reported Q4 on March 8th. This is a pretty scary market to initiate a position in a thinly traded stock where there could be no stock driving news for 4 months. That said I bought a little more today at $5.45 to add to my current already sizable position .
I do feel management is committed and capable, but the founder/CEO/majority SH is a dorky engineer who is anything but slick on CCs. One concern I have is that he's mostly focused on building the company and isn't focused on strategies to promote the share price--hence the lack of institutional ownership and low trading volume. He might also be more focused on developing cutting edge products (e.g. solar and NG generators) to go along with his core products than on generating high profits. That said he owns more than half of the stock so should have every reason to care about the share price.
HCLP I went green so sold 40% of my position at $7.05. Average cost of remainder now $6.64. Still seems very cheap to me if they can hold their dividend which is still almost 13%.
But backlog at $11.5 million
Revenue only $5.1 million due to supply chain disruptions. Another fumble for POLA.
My WAG for revs in Q3 is $7 million up from $5.8 in Q2. Any other guesses before the announcement?
Skillz Did you get my post before market close yesterday to trade PERI for HCLP?
Hclp--Blood in the streets. Licking my wounds. The dividend was already lowered and was well covered even in weak most recent quarter. I'm hoping that will cause this to bounce back.
HCLP You were right Matt. Now averaging down below $7 but have been catching a falling knife all morning.
FTSI Sold the rest of my FTSI at 12.20 to ensure it would surge to 12.60...
HCLP Initiated a position at 7.20 for a bounce.
FTSI Sold half of mine at 12 and tried to get the other half off at 12.20 but didn't hit. Surprised and relieved that earnings report has been so enthusiastically received. When there's such high institutional ownership I always feel like those guys are analyzing at a level far beyond my surface approach.
POLA Haven't posted about recently since little apparent interest on this Board but some positive recent developments including PR on Oct 1st announcing $7.5 million purchase order and recent announcement and an order for 91 installations in Namibia (although apparently no equipment included). You can see more detail on the POLA Board where southacresdave does an impressive job mining company updates online.
POLA is now positioned to continue to deliver material sequential revenue growth in coming quarters as it has in recent quarters.The founder/CEO owns a controlling stake which may explain (along with modest trading volume) the low institutional ownership even though his actions to date have been shareholder friendly. The short position has also steadily declined in recent months to a modest 90,000 shares. The balance sheet is pristine despite how aggressively they have grown their global sales effort and the capacity their production facilities.
The stock is up today on more than twice average volume so investor interest may be rekindling. While it's unclear how soon significant EPS can be posted, at an only $60 million market cap it's a good entry point to bet on their growing a large global business. Also,as they primarily provide equipment to cell phone companies which are quasi public utilities, I think their business will be more resilient than many as/when the global economy begins to slow.
FTSI--Q3 not good and they basically threw Q4 under the bus predicting growth again in Q1. Guessing it will be pretty bloody tomorrow but who knows.
FTSI--When you announce you're going to release earnings after market close, I think it's lame not to release within 30 minutes. It gives the impression (to me at least) that they aren't really on top of it but scrambling around at the last minute.
That order looks like installation but no equipment sales?
FTSI getting unexpected bounce on down day before Monday earnings after close. Should probably lighten up today but won't. If it climbs into mid 12s on Monday, I'll sell half before earnings announcement. Even a great announcement may not drive more than a few hour price rise in this market so I will sell whatever I own if there's a spike.
HCLP tanking to 7.50. At what price does it become a deep value trade despite the sand glut?
Re China stock spike, I think Chinese government rescue measures per the link below may have caused it:
https://www.scmp.com/business/china-business/article/2169294/share-pledges-chinas-central-bank-and-financial-regulators
What's weird to me is the 800+ point Dow decline coupled with 10 year Treasuries also selling off (yield rising). Maybe the Chinese are dumping part of their massive Treasuries portfolio as retaliation/warning in trade talks.
NRZ Don't currently own myself but have some in my kid's accounts. I understand a decent chunk of their acquired assets are rights to service residential mortgage portfolios for the life of the portfolio. Those become more valuable as mortgage rates rise because the portfolio is shrunk less by refinancings so cash flows longer. They could very well write down other longer term fixed rate debt in their portfolio which could weigh on earnings but the mortgage servicing assets should help mitigate the hit.