Q4 2013 Earnings Call

June 12, 2013 8:30 am ET

Executives

James Dennedy – President, Chief Executive Officer

Robert Ellis – Chief Financial Officer, Chief Operating Officer

Analysts

Brian Kintslinger – Sidoti & Co.

Shai Dardashti – DCM

Keith Housum – Northcoast Research

Presentation

Operator

Good day ladies and gentlemen and welcome to the Agilysys Fiscal 2013 Fourth Quarter conference call. At this time, all participants are in a listen-only mode. Later we will conduct a question and answer session and instructions will follow at that time. If you require any assistance during the call, please press star then zero on your touchtone telephone. As a reminder, today’s call is being recorded.

I would now like to turn the conference over to your host, Mr. Jim Dennedy. Sir, you may begin.

James Dennedy

Thank you, Shannon, and good morning everyone. We appreciate you joining us on the

F3Q13 Earnings Call

January 31, 2013 4:30 pm ET

Executives

James H. Dennedy – President and Chief Executive Officer

Robert R. Ellis – Senior Vice President, Chief Financial Officer, Chief Operating Officer and Treasurer

Analysts

Brian D. Kinstlinger – Sidoti & Co.

Robert G. Moses – RGM Capital LLC

Presentation

Operator

Welcome to the Agilysys Fiscal 2013 Third Quarter Conference Call. Some statements made on today's call will be predictive and are intended to be made as forward-looking within the Safe Harbor protections of the Private Securities Litigation Reform Act of 1995. Although the Company believes that its forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause results to differ materially.

Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company's reports on Form 10-K and

In the tech sector, where companies live and die by innovation, it's all about staying ahead of competitors. But in the quest to stay ahead, some tech companies lose perspective and become saddled with debt along the way. Paying off debt instead of plowing resources back into innovation is sub-optimal in any sector, but especially so when it comes to tech. With this idea in mind, we ran a screen to find technology stocks that are relatively debt free. In addition, to find the best of the best, we narrowed our search to only include those that received "Strong Buy" ratings from industry analysts, which can signal that a company has many other positive characteristics worth considering. We came up with a solid list of companies for you to begin your own research.

The Debt/Equity Ratio illustrates how aggressively a company is financing its growth via debt. The

When companies miss street estimates it could easily spell disaster, as was the case when Dell, Inc. (DELL) miss their Q1 estimates by $0.03/share. The major catalysts in the case of Dell was the fact the PC user market is shrinking as tablets such as Apple's (AAPL) iPad and Amazon's (AMZN) Kindle Fire grab critical market share. After Dell's miss, the stock fell nearly 20% in the short term creating a great buying opportunity for potential long term investors. That being said, these two companies recently reported earnings that fell short of analysts' expectations but after what could be a multi-session sell-off could have the potential to strive.

Cooper Companies (COO) - Founded in 1980, and based in Pleasanton, California, COO currently trades in a 52-week range of $52.60/share (52-week low) and $89.31/share (52-week high). The Company reported second quarter earnings which missed street estimates by $0.08/share and net income

Interested in gaining exposure to technology companies? Do you prefer high-growth stocks? Interested in companies with high liquidity? You might be interested in this list.

EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. The 1-Year Expected EPS Growth Rate is an annual growth estimate, where the growth projections are made by analysts, the company or other credible sources.

The Current ratio is a liquidity ratio used to determine a company's financial health. The metric illustrates how easily a firm can pay back its short obligations all at once through current assets. A company that has a current ratio of one or less is generally a liquidity red flag. Now this doesn't mean the company will go bankrupt tomorrow, but it also doesn't bode well for the company, and may indicate that it could have an issue paying back upcoming obligations.

The Quick ratio

Interested in technology companies? Do you look for companies with low debt? Interested in companies with minimal long term debt? Do you prefer stocks that analysts rate as 'Strong Buy'? For ideas on where to look, we ran a screen you might find interesting.

The Debt/Equity Ratio illustrates how aggressively a company is financing its growth via debt. The more debt financing that is used in a capital structure, the more volatile earnings can become due to the additional interest expense. Should a company's potentially enhanced earnings fail to exceed the cost associated with debt financing over time, this can lead the company toward substantial trouble.

The Long Term Debt/Equity Ratio illustrates how aggressively a company is financing its growth via debt. The more debt financing that is used in a capital structure, the more volatile earnings can become due to the additional interest expense. Should a company's potentially enhanced

Why does insider buying matter for small companies? Because small companies often have no analysts following them. This means choosing the right micro-cap (market cap < $300 million) can be very profitable. In fact, the Russell 2000 index has outperformed the S&P 500 significantly over the past 10 years, returning 66% and 25%, respectively.

Choosing the right small companies to invest in can be daunting: Where should you start? Insiders, especially executives and directors of small companies, tend to know their companies very well. Tracking their stock purchase activities is a very good point to start for lucrative returns.

Below is a list of notable insider purchases of micro-cap stocks (market cap <$300 million) filed with the Securities and Exchange Commission during the past week. Following Seeking Alpha's micro-cap policy, all the stocks are trading at more than $1 per share or have a $100 million market cap.

I have

I ran a scan looking for stocks and funds with recent insider buying. I also list, for consideration, current news which could partly explain the insider buying. Insider buying often reflects how those associated with the company and/or fund feel about its future prospects, and also indicates confidence in future share price appreciation. I recommend investors who find the information useful in this article use this information as a starting point for their own due diligence.

American River Bankshares (AMRB)

2/21/12 pps: $6.90

American River Bankshares operates as the holding company for American River Bank that provides commercial banking services to small to mid-sized businesses in California. It accepts checking and savings deposits, as well as offers money market deposit accounts and certificates of deposit.

AMRB reported earnings at $2.5 million 2011, considerably higher than $476,000 earned in 2010. Asset holdings improved to $581.5 million up from assets of

This week's Insiderize pick (from my weekly newsletter) is a case of the former: the stock looks bad, acts bad, performance hasn't been great at the corporate level, yet it has insiders stepping up to the plate and buying.

My methodology uses insider trading data from Bluetrader. I monitor hundreds of weekly trades, looking for interesting stories that may slip between the cracks.

Agilysys (AGYS) is a small cap stock with a market cap around $165 million dollars. It sells point of sales software, hardware and services to the hospitality and retail sectors.

• The stock is down 3% year

Accounts receivable represents a big portion of revenue for many companies, but as the name implies, these funds are not yet “received.” This can therefore be an area of concern.

When accounts receivable becomes a larger percentage of the revenues reported by a company, it indicates lower-quality revenues, because there is no guarantee that accounts receivable will be paid back in full. Companies with shrinking accounts receivable (relative to revenue) are viewed favorably.

We ran a screen on the tech sector for stocks with positive receivable and revenue trends: increases in quarterly revenue year-over-year outpacing changes in quarterly accounts receivable, and a decrease in quarterly accounts receivable as a percent of quarterly current assets year-over-year.

‪Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬

If you like to follow the buying trends of company insiders, you may be interested in this list.

We ran a screen on the tech sector for stocks seeing the highest net insider buying over the current quarter. Company insiders, like members of the board and upper management, know more about their companies than anyone else – if they personally buy their company’s stock, it is a big vote of confidence.

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Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬

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We also created a price-weighted index of the stocks mentioned below and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Company insiders, such as upper management and members of the board, know more about their companies than any other investors, so when they personally buy shares in their company, it is a big vote of confidence.

We ran a screen on tech stocks that are rallying above their 20-day, 50-day, and 200-day moving averages for those seeing significant net insider buying over the last six months.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬ ‪

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month.

(Click chart for more detail)

Clearly these insiders made a good investment over the last six months, but

Analysts follow the buying trends of company insiders because, after all, they have more information about their companies than anyone else. If a company sees an increase in shares purchased from company insiders, it’s a signal to take a second look.

We ran a screen on small-cap stocks rallying above their 20-day, 50-day and 200-day moving averages for those seeing significant net insider buying over the last six months.
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Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬

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We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Click to enlarge

Since the Russell 3000 made a bull market closing high on May 2nd, the average stock in the index has declined 18.10%. While most stocks are down, there have been some bright spots. Believe it or not, nearly 13% of stocks in the index have risen since May 2nd, and some have

It's often suggested that “volume precedes price”, and for that reason it's always helpful to look at the Money Flow Index (MFI), which is essentially a volume-weighted version of the popular Relative Strength indicator (RSI).

MFI is a more rigid indicator because it is volume-weighted, and is therefore a good measure of the strength of money flowing in and out of a stock. It compares "positive money flow" to "negative money flow" to create an indicator that can be compared to price in order to identify the strength or weakness of a trend.

It can be very useful to compare changes in the MFI indicator to the changes in a stock's price, since diverging patterns are often interpreted as trend reversals. All of the stocks mentioned below have seen prices decline over the last week, but the MFI(14) indicator has shown strong improvement--suggesting that these stocks are being accumulated at

If you're interested in small-cap ideas, the following list might offer an interesting starting point.

Below is a list of four small-cap stocks with market caps just over $100M, all of which are seeing an increasing call open interest relative to put open interest (i.e. a decreasing Put/Call ratio).

A decreasing Put/Call ratio represents bullish sentiment, which could continue. However some technical traders view the Put/Call ratio as a contrary indicator when it reaches extreme highs or lows, implying that these four stocks may be set for a reversal.

Do you think investors are being too bullish on these names? Or are these stocks just getting started? You be the judge--use this list as a starting point for your own analysis.

Options data sourced from Schaeffer's, recent developments sourced from Reuters, all other data sourced from Finviz.



List sorted by the change in the Put/Call ratio...

1. Procera Networks, Inc.

F2Q2011 Earnings Call Transcript

November 4, 2010 11:00 am ET

Executives

Martin Ellis – President and CEO

Henry Bond – SVP and CFO

Analysts

Brian Kinstlinger – Sidoti & Company

Zachary Prensky – Koyote Capital

Presentation

Operator

Welcome to the Agilysys fiscal second quarter 2011 conference call. Some statements made on today's call will be predictive and are intended to be made as forward-looking within the Safe Harbor protections of the Private Securities Litigation Reform Act of 1995. Although the company believes that its forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause results to differ materially.

Important factors that could cause actual results to differ materially are those in the forward-looking statements that are set forth in the company's reports on Form 10-K and 10-Q and news releases filed with the Securities and Exchange Commission.

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