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ETCC thx
I don’t have an estimate other than I would assume it would be north of last quarters .08 so your number seems reasonable.
It’s really hard for me to get a handle on what they are going to recognize in revenue quarter to quarter or for that matter margins quarter to quarter.
ETCC earnings should be out in the next few weeks.
Any earnings guesses?
TIA
ADFJF this PR also has a smell
The last time they announced a batch of contracts in May they announced the current backlog including the new contracts. With this PR they highlighted the end of quarter backlog.
That’s a direct change in behavior, and it’s reasonable to wonder if they didn’t announce the current backlog because it isn’t favorable.
MSS noticed that report yesterday, but it doubled in about half a second so I moved on
ADFJF announced 55 million in contracts
That’s the good news. The bad news is an undetermined amount was booked prior to the end of the July quarter, and hence was already included in the backlog number reported at the end of last quarter.
How many were signed subsequently? 1 million? 50 million? hard to say.
Not sure if this will move the stock today, but it’s possible this is functionally a puff piece announcing contracts that were added months ago.
https://stockhouse.com/news/press-releases/2024/09/24/adf-group-announces-the-signing-of-a-series-of-new-contracts-in-quebec-and-in
Also bought some GKPRF today
I think it probably bumps up when earnings are released after that big revenue pre-announcement. Probably .025 CDN although they could possibly do .03 which looks good against a .60 share price.
The company is attractive anyway.
They have a strong growth history, balance sheet is solid, and I like the business.
Cameras for school busses and public transit tied into AI for video analysis along with analytics, and a system to ticket drivers for ignoring stop arms on busses makes sense. Their customers they get expense reductions in the form of heading off lawsuits, crime monitoring, and a revenue source from ticketing.
The company gets recurring revenue on their PAAS platform in addition to their hardware sales which would be lumpier.
And they should be recession resistant.
FEIM general take
The story as it seemed to exist 6 months ago is progressively more in question. Revenue progression has stalled, backlog eased this quarter, and their target margins are lower than the 50 they suggested awhile back.
Now that could be just a matter of things moving more slowly, but still in the right direction. Still what I thought was a relatively high probability of things inflecting upwards further looks more like a coin toss. Eventually generic commentary about how strong the business is will have to be backed by tangible improvements on the top and bottom line.
It’s not exactly pricey at these levels so I’m not inclined to dump at 12, but my patience has a shelf life of maybe one more quarter. Further lack of progress on the topline, bottom line, and backlog will have me looking for an exit. Upside is still substantial if they can inflect revenue upwards. History says they will based on their backlog which is why I’m inclined to give it a bit more time.
Hard to imagine much downside from here at these prices. They do have a strong balance sheet and are putting out .25+ quarters with enough backlog to continue at that pace for at least the next year.
Thx EOM
OK, but did you ask explicitly about cancellations?
Also currency really doesn’t make sense to me. If the dollar strengthened during the quarter wouldn’t that increase not decrease backlog numbers?
I also disagree that it isn’t material. 40 million is a big difference.
Actually 2 other questions
1. could you share the math on how you arrived at the currency hit?
2. Did you ask them point blank if there were any cancellations? If so what did they say?
TIA
Gotcha
Appreciate the color although personally given the optics of seemingly leaked info combined with management selling at the top, I’m skeptical in part because the dollar strengthened during the quarter although only about 1.5%. The explanation seems wanting.
Huge upside if this is just a blip in a longer term story, but I’d rather pay more for some clarity if it turns out the more negative interpretation is wrong.
Good luck of course. I still have a couple thousand shares laying around, but I’ll likely sell those on strength. I still detect a smell, and have always taken a discretion is the better part of valor approach.
ADFJF was the backlog adjustment you reference in the sedar filing?
TIA
IBEX reported a nice quarter yesterday
EPS of .58 with solid guidance for this fiscal year. Good balance sheet with no real debt.
I just missed a bid around 18.40 this morning. Don’t know much about them
outside of a quick read, but they did see some post earnings announcement drift up after their last strong quarter.
Good trading on ADFJF
decent recovery this morning so far.
ADFJF here’s the problem
When you ex out that 90 million order in may they actually had a negative order book for the quarter meaning they had more cancellations than new work.
No bueno, and on the call management said they are seeing softness and delays in particular in renewable energy although they weren’t honest enough to highlight the obvious cancellations unless they did it in the couple minutes before I joined.
As I see it they cashed themselves out at the top, and then told everyone there was a long runway for growth even as existing orders were being canceled.
Oh and of course based on share price performance this was obviously leaked.
Sleezy, unethical? pick your word, but I don’t want to be involved with these people. Still had substantial profits, but I joined the dumping. Sadly most was at lower ends of the range. I was distracted at open, and with the stock shooting up I planned to sell to the greater fool that seemed to be bidding it up.
ADFJF looks suspiciously like management actually did cash out at the top and F over the shareholders.
I’ve got some more specific thoughts I’ll share later, but the negative reaction does seem surprisingly over the top.
KEQU yeah another case of weakness preceding disappointing numbers. Never a guarantee, but it’s the way to bet.
I found this bit related to corporate overhead weird
“The change in EBITDA was driven by an increase in professional service fees during the quarter that are unrelated to the core business and the net change in Corporate cost allocation methodology across our business segments.”
What professional services are they consuming that are unrelated to the core business?
Allegedly NVDA commentary about huge demand
GKPRF thanks for the alert
Picked up a few. A surface glance suggests they could do as much as maybe .03/share on that revenue
Solid balance sheet, and mostly a pretty good growth history in a decent industry in video surveillance that should be recession resistant.
FEIM mostly agree with that
It wasn’t me on the call. Had some other stuff going on.
I’m a bit irritated because when they said last quarter would have flattish overhead I asked them if that included R&D, and they said yes followed by R&D that exploded up sequentially. I’m not opposed to R&D, but it would be nice to think I could trust that answer for a quarter already in play.
On the other hand margins did even better than they suggested so maybe that’s a wash. Also they claim this quarters R&D expenses are going to drop back more to that million range so a similar quarter with more normal R&D is going to add maybe a nickel to EPS.
That leads to the issue which I’m guessing explains the reaction which was the very weak order book this quarter.
They did suggest the weak book to bill was an anomaly related to the mercurial nature of government, and that the order book would pick up. I think we would be in a different place reaction wise if backlog ticked up to 80 million instead of falling to 70. They are still bullish on the order picture, but I’m in show me mode.
There’s a legitimate question as to whether revenue growth has stalled and this is as good as it gets. I think it’s a good buy in the 12’s if we see a resumption of revenue growth, but the question marks around that make me think 12.50-13 is fair. I’d probably be a buyer at 11 although I do have shares left that I’ll probably ride out here and see how it plays out. Bigger picture they have done a good job improving operations, and it’s not exactly expensive.
They can’t seem to get all the pieces in place at the same time to put out a big quarter. Last quarter it was margins that fell short. This quarter it was revenues and expenses.
FEIM decent quarter not exciting EPS .25
And backlog down about 12% sequentially. All in all very meh.
FEIM not a fan of all their emphasis on lower margin or riskier contracts. On the other hand backlog is up dramatically and is usually associated with subsequent revenue.
There’s probably an easier path to being disappointed, but I assume they will put out a decent quarter, with a smallish possibility of a big quarter.
KEQU I’ve been watching it
Not buying it. I felt dumb when I cleared out my remaining shares a bit over 50 when it looked like it was going to keep going.
When I last talked to them I didn’t get a real strong feeling of enthusiasm from
management nor did they seem
to have any specific strategic idea on where to take the business.
My take was they are just captives to the bigger picture in their industry and results will directionally drift wherever that is.
The sell off does of course make me wonder if somebody knows something. I’ll watch for earnings, and might jump back in if those look good. I wouldn’t expect it to regain all of those losses instantly so waiting for more clarity and losing some upside seems like a way safer play than buying a falling knife right before earnings. We’ve all seen that play before and it has a bad ending more often than not.
ETCC nice news
I’m long this one despite some reservations about that huge contract. Would have been nice to get a current backlog.
Yeah really rough day for the IWM up only 1% or so.
Lots of green on my screen.
I love bryce canyon!
peekaboo is one of my all time favorite trails.
FEIM got my divvy too. Total return on this one has been pretty solid.
Thank you! I was under the impression the Navy was using wooden schooners.
If US Steel being purchased by a foreign company is the most treasonous act you can find you need to keep up with the news a bit more.
CAVA everyone is looking for the next Chipotle, and they think this is it.
FEIM has been perking up a bit on volume
There was a Sergio Heiber article on SA last week and he’s got a few thousand followers so there may be a connection.
https://seekingalpha.com/article/4714764-frequency-electronics-thriving-in-the-paradigm-shift-in-the-satellite-industry
Don’t feed the troll
BKTI wow great news!
Sure would be great for it to go on one of those low float parabolic runs.
This board is aging
I go all the way back to the raging bull days, and my impression is I was one of the young ones. I’m 53 now.
FEIM the 900k was in the filing
I called and confirmed with management that this is in fact what happened.
My main take is the 40% is the new margin target and right now they are mid 30’s. I think it’s likely they beat the year over year even with one times, but the story isn’t nearly as attractive as it was when it looked like they were working their way towards 45-50.
FEIM forgot to post this
This was my short take post earnings.
https://open.substack.com/pub/brettrichards/p/stock-idea-update-feim?r=3r88l&utm_medium=ios
Hweb was ultimately correct that the margin catch up was a significant piece of current quarter earnings although backlog suggests we should see a significant revenue ramp up near term.
If Lentinman were still here he would describe this as a dart throwing environment.
thx Apatel! EOM
You should have held out. You could have upgraded to an appetizer at applebees.
FSI I didn’t get to really listen.
My son who’s now a software engineer popped in with a work problem he wanted thoughts on right at the start of the call. I was under the impression they said something people liked because it took a nice bump up part of the way through. I’ll have to check the transcript when it shows up.
I think it could potentially grind its way to 3, but could become a hot story stock if they make some announcement about actually getting involved in manufacturing weight loss drugs although I wouldn’t like that if I was a long term holder.