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Mark Krieger
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Mark Krieger is an avid stock market trader dedicated to the following ideals: (1) Focus on high relative strength, (2) Buy low, sell high (3) Short high, cover low, (4) Go against the crowd, (5) It's all about the rules and discipline- hold them dear (6) Analyze the balance sheet-seek low... More
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  • Fuel Systems Solutions Third Quarter Earnings Preview

    Fuel Systems Solutions (NASDAQ:FSYS) is set to release its third quarter results this Thursday November 6th, before the market opens. Analysts expect the company to lose 10 cents on sales of $86.50 million. Sales are expected to drop 11.40% from last years $97.6 million mark. Earnings last year for the third quarter were 5 cents.

    In its 2nd quarter press release, the company's guidance for 2014 was sales of $335 million to $355 million and EBITDA of $4- 8 million.

    Look for FSYS to lose 11 cents on sales of $85 million, but slightly increase its 2014 revenue range from $335 - $350, to $340 -$355 on a better than expected fourth quarter.

    The news will likely have little impact on the share price, other than a possible catalyst for some to book profits after last week's incredible 15% rise from its lows. The worst case scenario: we could see as much as a 50% retracement of recent gains.

    On another note: The fact that Becker Drapkin's Steve Becker has been appointed as a FSYS board member can be construed as a positive for the stock price. He might push for short term fixes, such as financial engineering ( stock buybacks, etc.) After all, he has plenty of incentive to get the stock price up, as he owns nearly 10%. He wants to be paid for his troubles and risk.

    Disclosure: The author is long FSYS.

    Tags: FSYS
    Nov 01 3:43 PM | Link | 3 Comments
  • Luby's 4th Q Earnings Preview

    Luby's (NYSE:LUB): will announce its 4th Q results, no later than Monday, Nov 17th. A press release should be coming out momentarily announcing the specific release date. Last year they filed their 8k on 11/7 regarding their 4th q earnings.

    what we can expect: look for total restaurant sales of $120 million and culinary/franchise fees of $7 million. Earnings should be 3 cents. The Sidoti Analyst, James Fronda (the only research coverage luby's has) forecasted earnings of 2 cents, void of a sales forecast. Note: The 4thquarter contains an extra 4 weeks in it (16 weeks versus 12 weeks).

    Same store sales for the quarter will be up .25%

    total sales for the year of $400 million will be 2.6% higher than last years sales of $390 million. The company's earnings will be a loss of $1.2 million versus earnings of $3.3 million.

    Guidance for fiscal year 2015, will show restaurant sales of $365 to $375 million with a same stores sales range of -.5% to .25%

    In summation, expectations are quite low, and LUB could easily surpass them. It is quite apparent that the recent implosion in the share price more than reflects lackluster results on deck.

    Disclosure: The author is long LUB.

    Tags: LUB
    Nov 01 11:50 AM | Link | 6 Comments
  • Luby's: Shareholder Proposal For Reverse Stock Split Submitted

    I mailed (certified-return receipt requested) the following shareholder proposal to Luby's corporate offices on 7/21/14. I suggested a 1 for 2 reverse split, but a 1 for 3 might have been more appropriate, considering the enactment of the 1:2 reverse split, might not be enough to get the stock out of single digits, if it sinks any lower. one final note: If the shares rise (say above $7) then I reserve the right to withdraw this proposal, as its need would be certainly be diminished.

    the letter:

    Page 1 of 2

    7/18/2014

    Roy Amburg, Corporate Secretary Luby's Inc. 13111 Northwest Freeway, Suite 600 Houston, Texas 77040

    Dear Roy: Enclosed, please find my shareholder proposal for vote at next year's annual shareholder meeting. The proposal is being presented in accordance with SEC rule 14a-8

    In the past five years, the stock market has experienced one of its greatest bull market's ever, rising over 160%. Unfortunately, Luby's shares have not participated, and still trade near pre bull market levels achieved, back in March of 2009. There is no doubt, the current management team has been extremely stable (being at the helm for more than a dozen years) and has always put in a gallant effort towards improving operations , but that effort , has not translated into one iota of shareholder gain.

    It is time that management consider a "think outside the box" mentality, while embracing a sense of extreme urgency. The primary focus should be shareholder benefit. One way to accomplish this, is to examine alternative methods to enhance shareholder value, such as the reverse stock split (a form of financial engineering). Other methods include: (1) sale-leasebacks of untapped real estate locations and using the proceeds to repurchase shares or pay a special onetime dividend (2) Hiring an investment banker in an attempt to sell either a portion, or the company in its entirety.

    At this point in time, it would be a prudent step to adopt a "one for two", reverse stock split to help remedy the deteriorating condition of the stock price. Although some might argue this proposal as extreme, or even radical- it is clearly logical and sane. It is therefore my recommendation for shareholder's to seriously consider an affirmative vote for this measure, at the 2015 Annual Shareholder's Meeting.

    Passage of this proposal would reduce Luby's common shares outstanding by 50%, to 14,205,000 and simultaneously double its current share price (although market capitalization would initially remain the same). The implementation of a reverse stock split should improve shareholder value based on the following clear benefits:

    (1) Many stocks that fall below the $5.00 mark are no longer marginable by the brokerages that hold them in street name. This is because the broker begins to view the shares as too risky (inadequate collateral to loan on). This margin availability is vital to the marketability of a stock. It aids in creating buying power, and provides liquidity-helping prop up, a sagging share price.

    Page 2 of 2

    (2) It is a common for some mutual funds and institutions to be prohibited from holding stocks below the $5 threshold. Raising the share price, would open up these entities' ability to purchase the shares.

    (3) Shares in the single digits, often are lumped unfairly in an area associated with high risk and junk status and perpetuate the dubious connotations, of a penny stock. A rise above single digit status, would give the stock more respect and validity, while eliminating the negative stigma, typically associated with a low priced stocks. This should attract more buying interest.

    In conclusion, a reverse stock split is plainly in the best interests of Luby's shareholder's and should be deployed as soon as possible.

    Very truly yours

    Mark Krieger

    Disclosure: The author is long LUB.

    Jul 25 10:59 AM | Link | 7 Comments
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