Interesting that Yahoo finance Key Statistics says they have zero debt. That discrepancy might have caught some by surprise ?
But, looking at the other numbers there, you can easily see the impact of the sort of leverage they have attained, purposefully, by minimizing their investments in infrastructure, and maximizing their focus on a pure revenue generation model versus an asset generation model...
Only 7 million shares out... but, they lost $8 a share ttm based on a decline in sales of 17%. Take out that drop in sales figures... and they're immediately back at break even... perhaps better given the recent pruning of the dead wood they've been carrying.
And, from there, given 20% growth in same store sales... then they'd be spitting out $8 a share in earnings... which would dwarf their obligations and put them right back on top of the market.
Big leverage inherent in the business model depending on sustaining the numbers in sales... means small changes can generate dramatic moves in the stock price... but, it means big RISK exists too, which risk is realized, as now, when they don't make their numbers.
They are HIGHLY dependent on the sales performance... and the only real asset that exists is the ability of what they've put togeter to generate revenue greater than it costs them to generate it....
That's why the lack of ANY news re changes in the sales trends in the latest filings is... at best, a big red flag, and at worst a huge guillotine hanging over the market that they didn't think was worth mentioning.
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