Greystone Logistics: A Classic Valuation Gap [View article]
Maybe people were disappointed in the quarter, but it basically came in right where I thought. Fiscal Q2-Q3 are the worst quarters for the company. I'll be talking to Warren next week at some point.
No Sponge Left Behind: Patient Safety Technologies [View article]
We've been talking about the company on MicroCapClub for a couple years. The addition of the 130 hospital chain 18 months ago and deployed in less then a year had investor expectations very high, and the pull back in the stock to 1.50 is mostly investor fatigue as to why more larger chains haven't adopted. Even so, it's a very interesting story, and I think this piece is well written with achievable expectations.
Auxilio Inc. Has Multi-Bagger Potential And Downside Protection [View article]
Jeffrey: Good insights. I agree with you, it's a story that I think if they can show sustained profitability (which might mean easing up on the growth accelerator), the stock will probably be repriced much higher. I know a few of the larger shareholders, and I know that is what they are pushing for. They like to point to STRM.
Agreed, a different tone in this call vs other ones. Management understand there was way too much arm waving in 2012 and not enough closing of deals. It is very important for the company to now under promise and over deliver. Confidence should come back into the stock once a couple runs are put on the board.
The Coming Boom In MicroCap Agriculture Stocks [View article]
The premise of the article was microcap agriculture stocks, so companies with market caps less then $500m. Since I couldn't even come up with 10 micocap companies for the whole sector, I wouldn't expect a microcap ag etf. This is why I believe a scarcity value (ie premium) will easily occur in these names.
Greystone Logistics: A Classic Valuation Gap [View article]
It's really in relation to the number of cycles or loops the pallet makes not "years in use". I tried to get a real number from Warren about that but I think it fluctuates, but I think 10% attrition per year is a good number to use. Probably not something the pallet industry likes arm waving about.
Greystone Logistics: A Classic Valuation Gap [View article]
Due to the current beverage customer concentration, fiscal Q2-Q3 are seasonally their weakest. The next quarterly release will be fiscal Q3, so I wouldn't expect a barn burner. I imagine it will be similar to last years, around $5m and break even give or take.
I think overall the stock meanders up to a 10-12x TTM figure throughout the year ($1 or so). It can be much more though if he can land another large pallet customer to the mix, then the potential for shareholders could be quite sizable from the current prices. Either way it's a very interesting risk/reward here.
Greystone Logistics: A Classic Valuation Gap [View article]
It's all personally guaranteed by the officers so they keep on pushing it back to benefit the company..see the 8k from yesterday as an example http://bit.ly/X7wZPj
I agree, you need to find the smaller companies that play into the these emerging food trends, but the key is find the one that isn't limited by the products they sell or their own walls (a retailer). The best pure play in food verification, traceability, organic, gluten free is Where Food Comes From (WFCF). Whole Foods is there largest customer, Chipotle also just signed up as customer. WFCF verifies over 1 million head of cattle here in the US, and expanding their verification to pork, poultry, organic, and gluten free. They are monetization this data they collect everyday by launching their own food label. The company is very small but they are profitable with huge barriers to entry. I tend to believe the real money is made in companies like this before the first institution takes a position or first analyst initiates coverage.
Whole Foods: Set Up For Long-Term Organic Growth [View article]
Whole Foods has been a leader in the space for years, only problem is everyone already knows about them. A much better pure play on all of these emerging food trends is a company that verifies all the claims companies like Whole Food's make. The best pure play in food verification, traceability, organic, gluten free is Where Food Comes From (WFCF). Whole Foods is there largest customer.
Can They Spare A Penny A Click For International Coverage? [View instapost]
Jon, keep up the good work however you plan to monetize your expertise. May I suggest to never leave your financial success or distribution to one outlet (ie SA). You have a talent, I'm sure many other outlets would pay for it.
Noble Roman's Inc: Who Knew Pizza Could Be So Profitable [View article]
Conner:
1. I've talked to management a few times. It's not too hard to get to a higher per grocer level if they can start landing larger retailers. Larger by store size ie traffic. Most of their retail locations I've been told are smaller stores.
2. There are just under 40,000 grocery stores in the US, but its more like 80,000 if you include the smaller (sub $2m sales per year grocers). Keep in mind their growth in grocery stores is also correlated with the growth they also show in signing up Grocery Distributors. The Grocery Distributors are sort of the gateway into the individual grocery stores. I think they had 10 distributors at YE 2011, and now have 13. So the question would be how many grocery stores do these 13 distributors represent? When I talked to the company a few months back (when they had 11 distributors), I think they represented 4000-5000 stores. So this would be a good starting point for guestimation.
I think they continue to gain share for two primary reasons. First the pizza tastes better then other grocery store pizza. I've tried it and tried other competing brands and store brands. Second, the grocery stores make more money selling Noble Romans pizza then trying to do it themselves. The avg net profit margin at grocery stores is 1%, so if they can make 50% margin on Noble Roman's pizza I'm sure its enticing.
Noble Roman's Inc: Who Knew Pizza Could Be So Profitable [View article]
Conner:
1. The grocery take n bake did $371,000 for Q2, using a blended in store count of 875 stores in Q2, and then annualizing it, it gets you to ~$1700 per store per year. The company believes this will gradually lift to around $2500 to per store as they get into "larger" chains ie larger stores. The company has historically signed ~400 grocers per year, and I expect that to be achievable for the foreseeable future. One of their biggest states believe it or not is Washington State, not Indiana as you would expect.
2. They have signed 27 non-traditionals so far this year, so I think adding 30 per year is very achievable. The question then relates back to attrition of current franchises.
3. They had a mandatory arbitration in September, but I doubt the "other side" even showed up. I think the next big date is in late October. So we might get some tangible news by the time they report Q3 in mid November.
4. I honestly stopped at 2014 because it's hard enough to project 2013 let alone 2015 onward. I'm not a fan of DCF because I know how these food-restaurant stocks trade once they start showing tangible growth. They trade at higher multiples then tech stocks. Just look at PZZI's move from $2-8 after basically showing a 10-15% growth rate. But you can't compare apples and oranges, NROM is a licensing model and I would think would deserve a greater multiple.
5. Sorta answered this in 1, but I think signing 400 per year is very achievable.
Two other things I'd like to bring to your attention.
First, the company grew about 6% in Q2 year over year, but you have to back out the non operating licensing fees. See below from the most recent 10Q. Basically these are fees from franchises that were shut down a couple years ago, that are no longer in business but due to the contract, still owe/pay NROM. The good news/and bad news is these fees from non operating franchises is declining and should be -0- by Q1 2013. In Q2 2011 they were $200,000, in Q2 2012 they were $100,000. So you need to back this out to get a true sense of the business as a whole and when you do this you will see the company actually did grow 6-7% in Q2.
"Included in royalties and fees from traditional locations were $100,000 and $300,000 for the three-month and six-month periods ended June 30, 2012 and $200,000 and $400,000 for the three-month and six-month periods ended June 30, 2011, respectively, for royalties and fees recognized as collectible from traditional locations which are no longer operating."
Second thing is I'm hoping the management team starts to do quarterly conference calls starting this next quarter, which I think will help new and old investors learn about the NROM story.
Greystone Logistics: A Classic Valuation Gap [View article]
No Sponge Left Behind: Patient Safety Technologies [View article]
Auxilio Inc. Has Multi-Bagger Potential And Downside Protection [View article]
Abtech Holdings' CEO Discusses Q4 2012 Results - Earnings Call Transcript [View article]
The Coming Boom In MicroCap Agriculture Stocks [View article]
Here is a list of general agriculture etfs
http://bit.ly/YKZQvA
The Coming Boom In MicroCap Agriculture Stocks [View article]
Greystone Logistics: A Classic Valuation Gap [View article]
Greystone Logistics: A Classic Valuation Gap [View article]
I think overall the stock meanders up to a 10-12x TTM figure throughout the year ($1 or so). It can be much more though if he can land another large pallet customer to the mix, then the potential for shareholders could be quite sizable from the current prices. Either way it's a very interesting risk/reward here.
Greystone Logistics: A Classic Valuation Gap [View article]
http://bit.ly/X7wZPj
Forget Whole Foods, Buy These 4 Little-Known Stocks Instead [View article]
http://bit.ly/Y26Sdw
Whole Foods: Set Up For Long-Term Organic Growth [View article]
http://bit.ly/Y26Sdw
Auxilio Inc. Has Multi-Bagger Potential And Downside Protection [View article]
Can They Spare A Penny A Click For International Coverage? [View instapost]
Noble Roman's Inc: Who Knew Pizza Could Be So Profitable [View article]
1. I've talked to management a few times. It's not too hard to get to a higher per grocer level if they can start landing larger retailers. Larger by store size ie traffic. Most of their retail locations I've been told are smaller stores.
2. There are just under 40,000 grocery stores in the US, but its more like 80,000 if you include the smaller (sub $2m sales per year grocers). Keep in mind their growth in grocery stores is also correlated with the growth they also show in signing up Grocery Distributors. The Grocery Distributors are sort of the gateway into the individual grocery stores. I think they had 10 distributors at YE 2011, and now have 13. So the question would be how many grocery stores do these 13 distributors represent? When I talked to the company a few months back (when they had 11 distributors), I think they represented 4000-5000 stores. So this would be a good starting point for guestimation.
I think they continue to gain share for two primary reasons. First the pizza tastes better then other grocery store pizza. I've tried it and tried other competing brands and store brands. Second, the grocery stores make more money selling Noble Romans pizza then trying to do it themselves. The avg net profit margin at grocery stores is 1%, so if they can make 50% margin on Noble Roman's pizza I'm sure its enticing.
Noble Roman's Inc: Who Knew Pizza Could Be So Profitable [View article]
1. The grocery take n bake did $371,000 for Q2, using a blended in store count of 875 stores in Q2, and then annualizing it, it gets you to ~$1700 per store per year. The company believes this will gradually lift to around $2500 to per store as they get into "larger" chains ie larger stores. The company has historically signed ~400 grocers per year, and I expect that to be achievable for the foreseeable future. One of their biggest states believe it or not is Washington State, not Indiana as you would expect.
2. They have signed 27 non-traditionals so far this year, so I think adding 30 per year is very achievable. The question then relates back to attrition of current franchises.
3. They had a mandatory arbitration in September, but I doubt the "other side" even showed up. I think the next big date is in late October. So we might get some tangible news by the time they report Q3 in mid November.
4. I honestly stopped at 2014 because it's hard enough to project 2013 let alone 2015 onward. I'm not a fan of DCF because I know how these food-restaurant stocks trade once they start showing tangible growth. They trade at higher multiples then tech stocks. Just look at PZZI's move from $2-8 after basically showing a 10-15% growth rate. But you can't compare apples and oranges, NROM is a licensing model and I would think would deserve a greater multiple.
5. Sorta answered this in 1, but I think signing 400 per year is very achievable.
Two other things I'd like to bring to your attention.
First, the company grew about 6% in Q2 year over year, but you have to back out the non operating licensing fees. See below from the most recent 10Q. Basically these are fees from franchises that were shut down a couple years ago, that are no longer in business but due to the contract, still owe/pay NROM. The good news/and bad news is these fees from non operating franchises is declining and should be -0- by Q1 2013. In Q2 2011 they were $200,000, in Q2 2012 they were $100,000. So you need to back this out to get a true sense of the business as a whole and when you do this you will see the company actually did grow 6-7% in Q2.
"Included in royalties and fees from traditional locations were $100,000 and $300,000 for the three-month and six-month periods ended June 30, 2012 and $200,000 and $400,000 for the three-month and six-month periods ended June 30, 2011, respectively, for royalties and fees recognized as collectible from traditional locations which are no longer operating."
Second thing is I'm hoping the management team starts to do quarterly conference calls starting this next quarter, which I think will help new and old investors learn about the NROM story.