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Mark Krieger
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I am a value/activist investor dedicated to the following ideals: (1) Focus on high relative strength, (2) Buy low, sell high aka "buy the dip, sell the rip" (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... More
  • Luby's: Will Fourth Quarter Earnings Take Us To The Promise Land? 1 comment
    Oct 22, 2012 9:40 PM

    LUB is set to release its 4th Q earnings on Wed, nov 7th after the close of market. Estimates are meek at 5 cents on sales of $112 million. That compares to 2 cents in earnings last year, on $113.5 million in revenues. I expect that management was purposely light on the guidance (sort of a under promise, over deliver moment) so current guidance should be easily surpassed. I expect LUB to actually earn 8 cents on revenues of $116 million and those results should be enough to put this very thinly traded stock into orbit ( about a 10% jump). The rally will be exacerbated by a serious short squeeze. Unfortunately, Capstone Investment discontinued research coverage, so the only analyst on the conference call might be James Fronda with Sidotti,who currently has a buy rating in place. I am hoping the company announces some sort of stock buyback to reward some very patient shareholders.

    Disclosure: I am long LUB.

    Additional disclosure: I plan on buying more shares in extended hours trading, after the earnings release, if expectations are indeed surpassed.

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    Author’s reply » growth in the system: in the next 12 months, LUB plans to open 2 cafeterias ( currently operate 93) and 3 to 5 company owned Fuddruckers ( they now operate 60)..that represents a 4.5% unit gowth rate, not counting any additions to the company's 18 food service locations. There are also 124 Franchised Fuddruckers that should also see some unit growth.
    24 Oct 2012, 09:21 AM Reply Like
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