Post by
smllcps on Dec 04, 2013 5:40pm
A little disappointed . . .
The management has been talking about the big expenses being behind them. The expensive build out, the infrastructure, and the pairing back of expenses. The next few years were supposed to about reaping the rewards and pain of the last few years. Instead, they put out what could be an additional 20% in additional shares and weakend what was a good run.
With no debt, and assets to work with, if they needed funding for the short term, they could have leveraged some banking relationships. An 8 - 12% loan given the huge margins in this business certainly would have been better than diluting the shares, again.
They issued a large offering a few years back at 4.00 and then the stock tumbled, and tumbled, and tumbled. Here is hoping the history doesn't repeat itself.
I'm still a firm believer in the business but where I was optimistic the stock would hit 5.00 again, i think we are going to be lucky to see it hit 3.50 in the next few years.
Maybe someone with more knowledge than me can explain the rationale for issuing the stock instead of taking on some debt.