IVFH is capable of earning roughly $2.2 to $2.5 million a year in pre-tax income right now. They should be able to grow that roughly 7 to 10 % annually. And while the number of fully diluted shares is sickening, it should be under control for a while. With IVFH's substantial tax loss carry forward, it will be years before they pay taxes.
I see three hurdles in front of the company.
1) How much will the Fresh Diet bankruptcy cost them? They did not address this in either the 10Q or the conference call. I am certain the answer is not zero, even if they win every trial. Lawsuits in a situation like this are inevitable.
2) What happens in the next recession? There will be another one. We just don't know when. This is not a company that makes huge margins.
3) How many more competitors will enter the field? They admitted that they have competitive pressures in Chicago. Let's see what happens in other places around the country. The days of 10% year over year growth may be ending.
Overall, it was a decent quarter. Nice. Boring. The company needed a quarter like this. I don't think the next one will be as clean and boring.
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