Semantics. Asus and ppv both have points:
- PPV. BCCI is a 'successor company' (same stock base and 'founder') to a company which went public at $120/share.
- Asus. The people who were interested in investing in the prior technology company, are not the same ones investing in the current incarnation, a Hooters meets Starbucks coffee company which certainly has a conceptual appeal.
The question is whether there is money to be made. Two parts of this discussion:
- Stock. I think the answer is yes, as Mr. Henthorn does an excellent job of getting publicity for his company; unfortunately, to date the publicity items have not led anywhere substantive (reality tv, ice cream, NASDAQ, audited financials, 'under the radar' stock pick, advertising, etc.).
Current active initiatives include advertising ($1.7M worth, dwarfing annual revenues -- cost of which will hopefully be known when 2013 financials are published (due April 15, but delays can happen)) and franchising (originally announced as a key initiative in the sponsored Prime Equity Research report of Jan 2012 and in the hiring of industry renowned restaurant franchising experts, not sure it they are still with the business).
Worth noting some apparent (no numbers issued to date) recent franchise success in Florida after 'flubs' in TX and AZ, where multiple stores have been opened and closed over the last two years. Certainly, companies 'live and learn,' that is how you gain success.
IMO, company hopes that advertising will drive franchising interest -- why else advertise where the company has no outlets as they have announced they are doing? Note company makes $25K/franchise outlet up front, plus 7% of revenues, and the franchisee has to pay for equipment and remodeling, and is exposed for ongoing real estate and utility costs (per the PER report, likely individual franchisees can negotiate their own deal). And it could well be that franchisees may be better at operations than BCCI has been to date.
For traders, the trick is how do you time your buys and sells.
- Company. Less obvious here, but doesn't feel positive. The company's published financials have shown operating profits, but IMO that is due to management receiving little or no cash compensation and incorrect accounting of stock issued for services. There is now $7M of such stock, further dwarfing annual revenues, on the balance sheet as "Unidentified...Assets,' for example $500K for ice cream distribution; IMO a significant part of the $7M has to be written off to expense at some point resulting in lifetime to date huge losses for the coffee company with relatively nominal growth for the level of investment.
But perhaps stock 'investment' has been for 'corporate' stuff (ice cream, etc), such that a franchisee would have not have to include such 'expenses' in their pro-formas. Investors hoping for company success have to hope that is the case, but insufficient detail from financial statements to reach a conclusion.
So, view of BCCI depends on your perspective.
