RE: RE: RE: What the H*** The main thing pulling down the down the stock I believe are the warrants. There are actually 243 844 000 warrants exercible at a price of 0.50$. Since the reverse split, these warrants are exercible at 20 warrants for a new share, leaving a potential 12 192 200 new shares if the warrants are exercised. Their break up value is 10$.
If the warrants are exercised, this will nearly double up the number of outstanding shares, diluting EPS by half for us current shareholders. For the last few years, MB's net margin has been melting down from nearly 13% in 2003 to less than 3% in 2009 thanks to rising inputs price, rising debt cost, a complete squander into management wages and a very bad management from Bertrand bros.
Assuming an 400 M$ in sales for 2011 (very optimistic since competition is putting pressure of MB's sales) and a net earning margin of 3%, that's 12 M$ net earning. Assuming 16.4M shares + 12.2M of potential shares, that leaves us with an estimated EPS of 0.42$. With an optimistic P/E ratio of 19, that gives us a share price of 7.97, i.e. the actual share price.
Management own very few of MB shares. Only Bertrand Father still owns a susbtential amount, and he is not quite involved with the company as he once was.
I believe the sons are more focused on how spending daddy's money that turning around this failing business.
My money hasn't produced anything since I first invested in this business. Analysts' target price has been dropping for the past months. I'm still holding until the 2011 year results but since no insider activity has been pumping up the share's price like last year, I believe 2011 is ought to be unimpressive.
Only a takeover would pump up the share price, but at these current levels, I don't think the takeover will be much over 10$ a share...
Since they took control of the company, Bertrands bros have been driving it into the ground.
That's what always happens when a reserve split occurs...