VBDG is another stock of mine that I think will do extremely well from it's last trade at $0.37. I think likely VBDG will trade for $1-$2 within the next year. Their guidance implies earnings of $0.02/quarter on average for the next three quarters. They are in the midst of a massive product rollout. More DD is listed below:
=============================================================================================== COMPANY WEBSITES ===============================================================================================
30,000+ store fronts including Wal-mart, Target, Kohl's, Bed Bath & Beyond, CVS, Walgreens, Rite Aid, Linens and Things, Home Depot, Costco, GNC, Home Shopping Network, QVC, Publisher's Clearing House, Harriet Carter, Taylor Gifts, amazon.com and other online retailers, Grocery Store chains, Best Buy (coming soon), Staples, Circuit City's (coming soon).
40,000+ store fronts by end of calendar year 2008.
WHERE TO LOOK FOR VBDG PRODUCTS AT YOUR LOCAL STORES (chains spotted by board members -- last updated 6/11/08): MyPlace: Bed Bath & Beyond, CVS, Target. SteamBuddy: CVS, Walgreens. Zorbeez: CVS, Linens N Things, Staples, Wal-mart Extreme Beam: CVS, Staples, Target. Starmaker: CVS, Rite Aid Hercules Hooks: Bed Bath & Beyond, CVS, Kohl's, Linens N Things, Staples, Target, Wal-mart, Walgreens. EZ Foldz: Bed Bath & Beyond, Linens N Things, Target, Wal-mart
=============================================================================================== WHY I THINK VBDG IS A SLEEPING GIANT ===============================================================================================
(1) VBDG IS A MAJOR TURNAROUND/BREAKOUT STORY.
2007: -- 4 high-margin products launched -- near break-even for the year (before one-time items)
2008Q1: -- launched two new products (MyPlace & Steam Buddy) from TV ads -- VBDG reported Q1 a huge increase in sales over Q4 2007.
2008Q2: -- Massive retail launch just began for MyPlace and SteamBuddy. -- 30 - 34% retail operating margins. Expect Q2 to show a huge profit in ratio to its current market cap IMO with accelearting sales and net income from there. -- International sales to Hong Kong, Korea, South America, Canada, etc. Expect to be in 40 different countries by the end of the year.
(2) COMPANY GUIDANCE
Guided $47 - $50 million in sales total for 2008 + 2008 profitable -- with Q1 coming in at a (.05) loss, this implies the next 3 Qs need to be on an average of +.02 per Q (+.06 EPS total) or at least a +.08 annual pace at the absolute least to be profitable for the year as forecasted recently. How big will the actual profits be above break-even for 2008 is anybody's guess with sales and earnings to only increase from there, further raising potential targets. +.02 per Q (or +.08 annual pace), conservative PE of 20 = $1.60/share or over 300% higher than under .40/share. +.03 per Q, PE of 20 = $2.40 +.04 per Q, PE of 20 = $3.20 +.05 per Q, PE of 20 = $4.00
(3) BIGGEST RETAILERS COMING TO VBDG.
Wal-mart, CVS, Target, Bed Bath & Beyond are actually "bringing opportunities to VBDG" (by actually making additional offers to VBDG), and they're actually developing products FOR Wal-mart, Staples, Bed Bath & Beyond, etc. VBDG has been named "The Category Captains" in Staples, Wal-mart, and two other major retailers in which they pay VBDG to design the "On Seen On TV" displays for their stores and, in addition, VBDG gets to decide where within the display to put their own products.
(4) PRODUCT CREDIBILITY
Good Morning America, The View, and other programs gave their products an "A" rating. VBDG products have been on a host of other prime time TV news programs.
New product launched "Easy Foldz" was brought to the company by the buyer from Wal-mart. VBDG has been selling this new product at Wal-mart successfully recently and as a result of this success, Easy Folds is now selling at other major retail chains as well. It's now the #2 best selling item in the housewares department of Linens N Things, and Easy Foldz & Hercules Hooks are the #1 & #2 best selling items in the Household Products Department #17 at Wal-mart. Their new product Steam Buddy is currently Publisher's Clearing House and Dr. Leonard's number 1 most selling product.
(6) INTERNATIONAL EXPASNION
According to the latest conference call, they already shipping (Q2) to Canada, Germany, UK, France, South Africa, South America, and others coming soon.
(8) COSTS UNDER CONTROL WHILE BEING RECESSION-PROOF
(all facts below taken from the public conference calls -- please listen to them to verify their accuracy)
SG&A expenses as a percent of sales are forecasted to decrease exponentially as they grow sales unlike many other companies that need to grow their internal infrastructure as they grow.
CEO says that they passed on the increased shipping costs of the products to the retailers themselves with a "fuel surcharge" added onto the price. CEO says the current retail sales have NOT seen any decline from the soft economic environment to date.
VBDG management said they have so far not seen any softness from the weak economy.
VBDG management said these products are impulse purchases, priced cheap, that tend to actually save the consumer money in some other area (for example, the $19.99 steam buddy saves big time on dry cleaning costs).
From my own thoughts, the sales of the retailers that VBDG sells in are actually rising. In part because VBDG sells at cheap retail chains like Wal-mart, and in part because of growth of the number of stores Wal-mart, Target, etc. are opening which need to be stocked with VBDG products. See my post here: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=29491789
VBDG gave guidance of massively increasing sales. They get purchase orders for a few quarters in advance. So I have zero doubt that sales will climb big. (Wal-mart, for example, does their Xmas season ordering NOW -- and VBDG doesn't sell on consignment to anybody)
=============================================================================================== NANCY DUITCH: FOUNDER, CEO AND DIRECTOR ===============================================================================================
Nancy Duitch is a successful and influential entrepreneur and CEO with thirty years retail and direct to consumer marketing experience. She has held management and consulting positions with companies like Pep Boys, Spa Formula Cosmetics and Kent and Spiegel Marketing. She has been responsible for marketing programs which have generated over $1 Billion in revenue for brands like Hercules Hook™ Bun and Thigh Max™ and Botopical™. Mrs. Duitch has a legendary ability to develop successful products and marketing campaigns. The founder of Vertical Branding, her insight also extends to finding and developing the people who have helped her build this business, many of whom have been with her for over ten years, and who provide the backbone of our Company staff. Mrs. Duitch is also very active in Industry and philanthropic organizations, including the C.A.R.E. Foundation.
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