Could be strong turnaround story of 2014Vender has finally bitten the bullet.
It is selling its high volume low margin business and concentrating on its emerging high margin business in Brazil.
Annual sales of $85 million were not enough to offset a gross margin of 5 %.
Hence, increasing losses.
In Brazil, margins are about 35 % or 7 times higher than the current business.
That is, Sales of just $ 12 million will generate the same gross margin as $85 million currently.
Its a no brainer transformation.
With about $8 million in cash (14 cents per share ) and about $2.5 million lopped of its liabilities thru recent sales, and the new CD deal, Vendek will have more than enough cash to fully fund its Brazilian expansion from current sales of about $1.5 million.
If all goes as expected, Vendek should exit 2014 earning about 4 cents per share.
Thats a 5 bagger from here