Mike Arnold
Long only, small-cap, tech, growth at reasonable price

Billabong: Accounting Principles Say Brand Is Worthless, But The Business Isn't

Billabong (OTCPK:BLLAY) ("Billabong" or "the company") is an embattled boardsport (surf, skate, snowboard) retailer headquartered in Australia. The corporate drama of Billabong over the past year has been nothing short of amazing. The media hasn't helped out Billabong either, with dozens of recent sensationalistic headlines slandering Billabong's brands as worthless. Even though technical accounting treatment with respect to the carrying value of intellectual property required Billabong to write down the value of its trademarks on its balance sheet (some to zero), the business is clearly not worthless.

Along with the uncertainty and headline risk afflicting Billabong, has come an opportunity for discerning investors willing to accept volatility for the potential of multi-bagger upside.

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Currently priced...

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