Newcomer to board, UPZS thoughts!
Hello,
I am new to the board, but am also long-and-strong UPZS, and have been for most of 2006. I have several comments to make after exploring this board and reading the messages from the last 3-4 months. I don't have any inside info unfortunately, but have been on some conference calls and investigated other matters on my own.
First of all, I am VERY bullish on UPZS moving forward. They truly are uniquely positioned to make a huge move into the fast-food pizza business. There hasn't been any really new players in a while that have tried to combat Domino's or Pizza Hut directly, UPZS indeed is. Firstly, should the economy slow, fundamentally speaking, folks are going to still eat fast food in the US - this lifestyle is currently baked in to their normal day. Will they go to high end restaurants if money gets somewhat tighter?? Probably not. Will they opt for Applebees/Chili's? Maybe, but they will most likely go for where they get a lot of bang for their buck. UPZS offers this.
Secondly, from a pragmatic standpoint, how many of you have thought about ordering in a pizza, and the thought comes to your head "what should we get this time?" It's almost as if you're locked into Domino's or Pizza Hut, even though honestly their pizza lacks taste and the ingredients are different depending on where you get the pizza and which date you order it (b/c their business is now ALL about the #'s). I love pizza but dread ordering in, and would love an alternative. I've had UPZS food and it is awesome, and great bang for your buck!
Now for the stock... Folks, there is no reason you should be watching every tick on this. Most of the shares are in very strong hands, of friends and family of the company. They are going to wait for execution of the business plan before even considering selling. Yes, the execution has been slower than we wish, but most new companies tend to become over-exuberant in the beginning. This company had many growing pains getting started, but the telltale sign of their success is the # of committed franchises. Remember, each of these stores can cost upwards of $200k, a big investment that smart people are NOT going to partake in without some high degree of confidence. Why not build a Quizno's or something more proven?? This to me is wildly bullish!
There will most definitely be a merger of the PA and DE company, likely in January if I were to guess, and I do think they'll produce some audited #'s soon thereafter as well. Persoanlly if I were to speculate I would say the company is being quiet in leiu of getting the merger done. Why release too much before that is done? One piece of advice, do NOT let the merger shake you up at all, it's been planned for a year!
The share structure is one sticking point with me. I have voiced my opinion in many different ways to the company on this. My speculation after being involved in the market for over a decade is that they are aware that to get the institutions buying, they need a tighter share structure, and need to be up-listed. My opinion is they will get uplisted onto the OTC BB sometime in Q2/Q3 of 2007. This will significantly help the stock price. Back to the share structure, there are around 68M (don't quote me) shares floating, with 486M outstanding. Far too many. Just to get to the market cap of PAPA Johns, the stock would hit $2. Folks, there WILL be a reverse split of some sort. Why worry though? They would NEVER do it below $.85-$1.00. If the did a reverse split at $1 at 1-5, that would put the stock price at $5/share. To get listed on a major exchange you must be at that price level. Once the cash-flow runs positive the company will begin buying back shares...
All in all, I think the company is a compelling story. I think they have enough cash to build the business now, and 07 will be a true execution year. They have a few major milestones to hit, and we'll be well on our way... Up until now it's been start-up mode, once the merger is done than I think you'll see a lot more news about store openings.
Good luck!
AI
