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I must be slow. I'm not very familiar with D&B, but CEC has six locations in the Seattle area alone, and 4 in Kansas City. These are fairly small markets. And they aren't stealing business from each other, they're supporting each other. 25 mile radius in L.A. encompasses probably several million people.
I've been to a D&B in Texas. Think Dallas, but maybe Houston. Those require a substantial investment. If memory serves me correctly, Uwink was built out for less than a million dollars. About the same as a McDonalds buildout.
Raw; I should have spelled it out more for you. My point is that they can't expand near as efficiently the company owned stores if they go outside of a 25 mile radius of the existing one. Part of the scale of efficiencies come from expensing advertising costs within an ever larger base of locations. Keeping the locations more clustered allows them to use the same advertising source (local paper, radio), and spread those costs between locations. If you have one in L.A., and another in San Francisco, then you just double the costs associated with advertising. The same can be said for dealing with your suppliers. If they know they will be servicing 2,3,4,etc locations, you get better costing. If they are just getting the one in L.A., and do not service S.F., then you lose the efficiencies there as well.
Hussler; that's an easy call. If they are going to open any company owned stores, it has to be within about a 25 mile radius of the exising one.
I don't look for any franchise sales soon. Apparently, Busnell is not confident in this concept. If he's not, then potential franchisees are not. This has to play out over a 1 year period.
The PR's, including the one today, just say that they've sold advertising. CMDA historically has had problems delivering the installation. They need to show that revenue is being billed and generated, not just contracts signed.
I see what you were saying. Of that, I do agree.
I disagree. It's Tobin. Look at level 2. You'll see just a whole bunch of small lots being traded out. these are small retail sellers, not institutional investors or major investors.
Thanks for sharing that. i was wondering why this was tanking on such small volume. constant 100,200 share sales. These subscribers of Tobin Smith are microcap players that come and go. They're looking for a quick hit, and are small retail buyers. As they go and get the pressure off of the bid, it will come back.
nice news from europe.
Insmed Incorporated (NASDAQ: INSM - News) has been requested by the Italian Ministry of Health, to make its drug, IPLEX(TM) (rhIGFI/rhIGFBP-3), available to physicians in Italy to treat patients with Amyotrophic Lateral Sclerosis (ALS), also known as Lou Gehrig's Disease.
Don5: It's cool. However it is interesting that you and the imposter both misspell my name the same.
Don5 - what are you talking about. Your first reply (#69)says that CMDA has not posted their third quarter results yet. Then your next reply (#70) says that they have posted their results. Then your third reply (#71)proceeds to tell me that they already have posted their results and that I am lieing? My message specifically stated that I was looking at their third quarter results, and I was wondering if their third quarter EBITDA of $935k was correct as I was reading it. I looked at the time you were writing the messages to see if you were writing during an extended happy hour or something. You must work the graveyard shift.
Guys: i'm not any help to you, but maybe you could help me? What does a Technical analysis for RRGB show. You'll probably need to run a 2 year chart, as it has a habit of the bottom dropping out, sitting for two months, then climbing back up again, etc. What is the TA Prognosis?
TIA
hopefully I'm not watching this all alone. I just looked at the third quarter financials that they posted this morning. If I read it correctly, third quarter 06 (Sep 30) posted a $935,000 profit? I hope that's correct. Anybody else looking at it?
My candidate right now is Red Robin Gourmet Burgers. Pull up a two year chart, and you'll see why. They have a history of the bottom dropping out, then recovering nicely. RRGB.
I have a hard time believing that he mentioned MOBL at all. If I were him or Tobin, I'd be keeping a low profile on a recommendation until I saw something more positive coming out.
Watching it on level 2 again today. Seems to be a gap holding between bid and ask. A couple of times so far a sale went through at the bid (.19), but otherwise the ask is holding firm, and appears that the back up asks are headed higher. Looks like shareholders are holding for the long run. Won't take much to make this thing run. Just some positive, recent earning reports, or completion of additional installations. 2007 has to be the year. If they can't come through, you won't want this in 2008. But I still think this should run to 1.50 in 2007, provided CMDA comes through on their part.
i've been watching it on level 2. Zero bids between .19 and .16. And it seems more like where this morning the bid would go up to chase the ask, right now the ask is going down to chase the bid. Not a lot of volume, and end of the year. It could close out the week at .20. I think that the high today was .235 so far. If this stock is as it seems, best is yet to come. if it is as it seems.
East: I echo your concern. The porn shows up, and has not disclaimer, or request for age verification, or anything. It appears likely that you won't even know what it is until you have already clicked onto it. I'm afraid they will run afoul of the FCC, or some other regulatory board, and also be subjected to a number of lawsuits. From looking at how the site is structured, the person can post the porn, and it stays up until someone clicks on the link that says "report it", or something to that effect. But my impression is that it is not monitored over the weekend. Just don't know. I'm trying to get a conversation with my daughter going on about myspace.com and if the same thing goes on over there. Not sure how straight of a conversation or answer I will get out of her.
Serious: I think MOBL's gonna have a very hard time getting financing. Probably, in my mind, the most likely scenario is that they will be acquired, in whole or part, by another company. I'm dreading what the acquisition share price may be.
Cougar: I'm a little surprised that the BOD hasn't replaced JW. Or forced him out. What's your take? Is this a hand-picked board, a "we're just here for the recognition" type of board, or does the board just not know what to do?
it's already turning a small profit. There have just been too many delays in getting the boards manufactured and installed correctly. If the press releases are correct, they've got advertisers lined up for a good portion of the signs yet to be installed. I say if you believe the press releases, because it appears that there have been some shenanigans going on with regards to legitimate contracts in the past. I can't say who's to blame. But this thing should be able to make about .30 a share next year, so I don't know how it could be less that $1.50 when they reach that point. I just have a small holding at this point.
Sagar: great thought. However, in general, myspace caters to a younger crowd. The money in restaurants like this is made on the liquor, not the food. You have to have the right patrons to make this work. Great idea, great concept. I just don't think the economics are there.
Retarius - I don't think this is a short, squeeze or otherwise. Just too thinly traded to be a good short prospect, as well as has some really good momentum behind it. Shorts look for weak, volatile stocks. I don't think that this is one at this time.
jews4kapler: You may see some agreements for master franchisees come into fruition fairly quickly. However, I don't think you'll see much actual action as far as building for at least 2 years. The first year in a concept restaurant like this is a honeymoon period. It's new, everyone wants to try it to say they've been there, there's oodles of cash. It's the second year when the novelty has worn off when you get a realistic idea of what the cash flow will really be like. That's what franchisees want to see. That determines the buildout pace. I think that UWNK is realistic in their projected restaurants, I just think that they're too aggressive with their timeline projections. They'll get there, will just take longer that they think it will.
Raw: there's some relevance as to what you say on the warrants. However, it doesn't change the fact that the only shares that would be exercised at this point are the ones at 0.35. So, in essence,UWNK would be selling those people $12mm worth of shares for $2mm. UWNK gets $2mm, and now there are an additional $12mm of shares floating around. Hardly a bargain for the rest of us. That's dillution. And a very expensive loan. Whether the ones at $3.10 get exercised is anybody's guess. I don't know the time period in which they expire. Period.
Speaking of dillution, how about the $3mm of shares that were set aside a couple of weeks ago. In June, they set aside 1mm shares, at about .30 per share, or a total value of $300,000. 5 months later, they set aside another 1.5mm treasury shares at approx $2.00 per share, or $3,000,000 of shares for the employees option program. That's a pretty big jump (a ten-bagger) in 5 short months.
Rawnoc: i'm not sure what you posted. The warrants are essentially options to exercise at a later date. At most, UWNK will get $2mm. The other warrants are either cancelled, or "out of the money" at this point and would not be exercised. So at best, the 6mm shares with a strike price of 0.35 is what the company would get. What you need to be conscious of is the fact that those 6mm shares represent almost a 6 week supply of shares that could come on the market, should the recipients choose to sell them rather than hold them. Those warrants were issued as part of previous loans that the company received. UWNK has already gone through that money.
buyvalue: Got your message. Agree with most of what you said in it. However, a restaurant concept doesn't have to be wildly successful to seel franchises, just have a solid business model that shows to be successful (without necessarily the wildly part) and easily duplicated. But do appreciate your insight.
Rawnoc: that plan don't hold water. Tell me this, how can someone expect to sell a franchise for $500k (for every 2 franchises sold, will build a new one for UWNK), plus expect the franchisee to pay $1mm for a buildout, plus a continuing royalty. That dog just don't hunt. If you think that you can get a franchisee to pay a $500k franchisee fee, it just ain't going to happen. WHere do you get that figure? A McDonald's franchisee fee is about 1/10 of that, plus McDonalds guarantees to buy gack the franchise if it doesn't make it. Where did you get your figures?
Buyvalue: They don't need to take on any debt to build out the 50 or so company owned restaurants. They have about 24,000,000 shares in their treasury. For each restaurant they build, using the current $1,000,000 figure, they just need to sell on the open market 500,000 shares. While that may seem to be dilution, they will get for that an operating restuarant without any debt, that will produce an ongoing revenue stream to the corporation. They just don't need to take on any debt at this time.
I'm still not sure why they have 5,000,000 preferred shares in treasury stock.
he's not lowering his position to "make room" for others coming in. Oh, Crap.
FOrtune: THanks for the note on CMDA. I don't see their filing of yesterday as being anything other than business-as-usual this year. I'm disappointed that they have had so many delays, as I really thought that CMDA was a winner. Still think it will multiply greatly, when they get their act together.
I'm going to try to listed to webcast tonight.
On the selling of franchises, generally the company (for instance UWNK), sells a master development franchise to a development company. That development company agrees to build out x number of restaurants over a specific period of time. The developer generally sells them to a franchisee, which more often than not is contracting with the developer to purchase a multiple number of locations that the developer builds. The developer makes money from the buildout, and often collects an on-going royalty. You may find that there are some franchisee owning operations that also have their own development company, but generally not.
Sagar: buying out the lease on a failed restaurant is attractive to people trying to get in the restuarnt business on a shoestring. TYpically the past owner vacated the property, and left the equipment behind. This is especially attractive in the kitchen area, as the design of a single exhaust hood can cost as much as $15,000. It's also one of the ways a landlord attracts a new tenant - just move in, the place is ready to go.
Won't work for Uwink, IMO. They have a very specific concept that needs to be duplicated verbatim. Exact equipment, tables, chairs, tile, etc. Would have to gut the place and remodel.
Fortune COokie - what do you make of the price action of CMDA? I just can't believe it's that cheap, unless there were really problems with some of the contracts at the airport.
msuhockey/sagar: I wouldn't get too concerned about the low barrier to entry. If you look at Chuck E Cheese, talk about a low barrier to entry. Some mouse, some balls in a cage, some games that cost $10 to get 300 tickets to get some crappy prize. Jeez. Hard to duplicate?
UWNK is there first, can build a network, has strong management that understands how to sell franchises, is able to develop proprietary games, has leadership that is experienced in restaurant development and franchise sales, can develop a concept that other restauranteurs can understand. That's the barrier for entry for competition, and it's a high one.
And better yet, if I need cream with my coffee, I can get it.
Robo: Disagree on the volume. The volume exploded prior to 11:30 am. Has continually waned ever since that time of day. Hopefully, that means that the sellers are becoming fewer.
jews4kapler: Nobody said anything about pump-n-dump. Letting other investors know of this possibility is how I eventually got here. But, I make up my own mind as to whether or not to invest. This is a spec stock, and when you invest in this kind of stock, you need to get as many opinions as possible in addition to your own DD. We all know this. And thrive on this kind of challenge. I appreciate knowing about this stock. How could I bet against Bushnell, regardless of financials? He's done it twice, knows the ropes, etc. For me, I like this type of bet on BB. I only know of one other BB bet at this time that fits this mold, and I'm in on that one as well. Hope you chill, and maybe go investing in 30 year bonds. Maybe more your style?
Brian: I believe that Motely Fool, Tobin Smith, Michael Murphy, find their targets by attending showcase meetings whereby a bunch of BB companies give their spiel, then talk individually with those that want to know more about their company at the end of the showcase. I'll see what I can find out.
IT's a bulletin board company, not pink sheet. BB's have reporting standards.
I don't think I've ever heard Cramer talk about a BB stock on "mad money". It's more likely to be picked up by Motley Fool's Hidden Gems subscription based service, or possibly by Tobin Smith.
Sammie: have to agree with the others. Been long here for more than 2 years. It's just gotten to the point where it's the same old line from Jay, quarter after quarter,and no real delivery or substance. You have to look at a company like MetroFi, that has been able to raise a lot of investment capital on the private markets (I've heard $900 million, but seems like that is way too much, so I'm probably missing something), and we still struggle to get money from Cornell or a lease arrangement for the towers. I'm dumping half, if not all, on Monday. Meant to do it yesterday, but forgot to put the order in before I went hunting. I've got better places for it. As a CEO, you've got to deliver sometime. I kind of look at JW like I look at one of my sales managers - you've got to deliver, or I don't need you any longer.
TS's latest on MOBL was more of a Hold. Certainly not a sell. you can read it on the yahoo board.