Quipt Home Medical Corp T.QIPT

CFO per CC-No inc and Neg. EPS guided for next two years?

[Whynottoday]

Newbie here and thought about deploying cash to invest in Quipt, but see during the CC, that the CFO said they are guiding for zero to negative EPS for the next two years. (see quote per CC question below.)

I have read before they were suppose to reach scale once they hit 130 mil US revenue? Will they ever be profitable? Also noticed some analyists downgraded Quipt and also adjusted their projections for negative EPS for the next two years. I also noticed the company no longer posts analyist reports on its investor site. Why not and any thoughts about these issues?

Per CC...

Michael Freeman

We've noticed from ‘22 to ‘23 is the shift from sort of positive to negative EPS. And I wonder if you provide sort of a rough outlook for 2024 in respect to earnings?

Hardik Mehta

Couple of one-time items back in 2022. The biggest one was related to forgiveness of the government grants that companies like us received through covid. In terms of 2023 the factors against us, is certainly the higher interest rate, is depressing the margins. But as far as going into future, I would say we would be, we would be either neutral or slightly negative, and most of that will be continued, will attributed towards higher depreciation, amortization and interest expenses that is expected at least in the next two years.

[westcoastlogger]

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[lscfa]

You pay $70M cash for an acquistion, then deduct for 10 years from earnings a non-cash expense called amortization of intangibles making eps negative. A gross distortion of economic reality.

[Whynottoday]

Thank you for the reply ISCFA. After a little more DD, I have decided to pass on the stock and wish you well. Looks like they will have to continuely do equity raises to finance aquistions or go into more debt, as earnings and cash flow are not sufficient enough yet to contribute to growth. I will keep an eye on it though, to see if things improve. Appears the next couple years are a bust

[longerterm1]

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[lscfa]

You're missing the organic growth component. In some cases mom & pop shops who can't make a go of it are just closing down. They refer their customers to a competitor in the vicinity or just let the customers fend for themselves.  This is a no cost way for Quipt to grow.  

[Whynottoday]

Should be interesting to see how the market reacts to the continued MGT guided losses / negative EPS.  Might by the stock depending on the results.  Per CC... Michael Freeman We've noticed from ‘22 to ‘23 is the shift from sort of positive to negative EPS. And I wonder if you provide sort of a rough outlook for 2024 in respect to earnings? Hardik Mehta Couple of one-time

[westcoastlogger]

Dont buy it then. Simple as that.

[Whynottoday]

Why would you say don't buy it? I am waiting to see the reaction of the market to the continued loss EPS earning release, as guided by MGT, before deciding.  What is your problem?

[westcoastlogger]

I have no problem. Been a long holder here for quite some time and am settled in for the long haul. Healthy well managed growth company thats re-investing capital in our 95% shareholder approved plan. Thats been quite evident for a few years now so I'm puzzled why you seem to think this is all something new. Stock took a hit because some uninformed people got freaked out about the ATM plan

[Whynottoday]

Yes, I have a motive. I want to make money. Iam ust waiting for more information through F/S upcoming CC release to see how the market reacts. I see you say you made 40 cents a share on $6.00 Quipt since you bought, so not so sure I want to be in your boat......I will wait and I am patient.  Look forwad to seeing the F/S release.  Good luck to you though.....

[westcoastlogger]

Well I was kind of puzzled by your post on Jan4 and you said you had decided to pass on the stock and kind of inferred this was toast for a couple years at least and good bye and good luck. And then here you are again a month later in time to buy some just before earnings and helping it down to a better buy by some more wink, wink, nudge, nudging. Its no big deal. Countless flippers have done it

[gibbonsj]

It's important to break out the impact amortization and depreciation have on eps. These are both paper losses. Free cash flow might be a more reliable indicator.

[Whynottoday]

I will have a look. I don't penny flip so waiting for momentum. There has been no significant M&A in awhile as interest rates seem to be having an effect along with the markets reaction to not wanting more financings/dilution.  I will wait for MGT M&A guidance and F/S release before deciding to take a position or not. MGT stating negative EPS for a couple years is concerning plus

[Carlito3311]

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