RE:RE:Upcoming Special Meeting
Interesting take b4545…. As far as the Park Place location goes I’d say it was a big gamble from the get go. Why would any business commit to open before 40% or more of the project was in place? The potential for 20 apartment buildings being built in the vicinity should have been a big red flag as to WHAT IF that didn’t happen? I think that one lands squarely on the shoulders of management. Nonetheless they are out of that high rent district now.
Not being familiar with the company’s full marketing plan, I do tend to be less critical, but agree that some of the things you mention could be easily incorporated, such as radio station give away, and capitalizing on social media, which is big with their target market so yeah why not capitalize on that. OF course you can only do so much with the resources you have, and one of those resources is manpower.
When it comes to earnings, I don’t think you have pegged that one accurately. Changing their reporting to EBITDA does not translate into earnings for an investor. EBITDA is sort of like earnings before everything, especially since they have a new $1.4 mill secured debenture out there at 9.0%. Reporting in EBITDA is simply a way to glaze over the fact that there are no net earnings/profits. Furthermore; expanding through leverage adds risk, as well as a drain on cash flow. In my opinion it will take more than the 3 planned location openings to make them profitable.
Given the number of shares issued and O/S, I am of the opinion that 0.08/share is far too generous at this point, especially given the new debenture, it is secured, so before those new locations open and generate revenues, I wouldn't be a buyer again until this one moves down. That said the share price is moving towards the point where there could be more buyers than sellers. Obviously insiders like this value, but I don’t think the buying is about fair value.
Is management on the right track? I think so.
Could they be doing more? Probably, but then couldn’t we all.