Care.com (CRCM): Jaw-Dropping Insider Selling, Obscene P/E
by Sonya Colberg, Senior Editor, 3/16/2017 7:48:56 AM
TheStreetSweeper issues an alert for any investor considering stock in Care.com (CRCM).
The stock has recently ripped to an unsustainable level and is now dropping back a bit. We believe the current decline may be the beginning of a larger, well-deserved unraveling.
The Waltham, Massachusetts company connects caregivers, such as babysitters or tutors, and families through a website.
The stock ran way ahead of the company's true value, in our view, after Care.com announced it had beaten guidance expectations.
Though Care.com's operating losses were reduced, traders may have missed that the company lost $0.7 million in 2016 ... not exactly a hallmark of a booming business.
Here's the executive summary:
*Extreme Insider Selling: In a year, insiders have dumped 4.3 million shares! Officers sold > 53,000 shares last week, alone.
*Outrageously Expensive: The stock's P/E is 114!
*Outclassed By Competition: The chief rival makes 10 times more revenue and 2 ½ times more earnings. But Care.com is 2 ½ times pricier than the rival’s stock.
*Tripping Hazard: Care.com is a roll-up. Just one of its eight business acquisitions has resulted in ~$36 million in impairments.
*Risky Business: An attorney general is looking into complaints surrounding Care.com. Consumers have lodged more than 600 complaints against the company.
Investors may find the company website here. Meanwhile, TheStreetSweeper presents the top reasons we think Care.com might be ready to be renamed Care.bomb:
