RE:QIPT - "Ensnaring Retail Investors, Enriching Insiders" Carlito wrote "
The market has been puking this name out for months. It doesnt buy their Adj. EBITDA nonsense, nor all the promotion. They should put themselves up for sale...the most synergies possible would be kicking out these losers and their bloated salaries, bonuses and insider rent deals Is Quipt going down the same road as VMD?
Here is what Richie Capital Group has to say about Viemed Healthcare, Inc. in its Q3 2021 investor letter:
"We exited our position in Viemed Healthcare (VMD) in July after holding the stock for a little over a year. We acquired our shares at what I believed to be a post-pandemic discount. As the pandemic continued beyond our original estimates, the inability for Respiratory Technicians to visit doctors in hospitals, and patients in homes, proved to be a major headwind. Management was never able to get back to their pre-pandemic growth rates, and I did not believe it would happen soon. It is a reminder that, in a relationship business, even when your relationships are strong, there is no substitution for a face to face meeting, a handshake, or a hug to revalidate the relationship. And with a year lost, VMD was losing significant time ahead of a possible 2023 new rate announcement under the Competitive Bidding Program which could significantly impact their non-invasive ventilator business.
Another concern was their handling of executive compensation. From the beginning, I was frustrated by management’s insistence on adding back options grants to their reported Adjusted EBITDA numbers. Option grants are a real expense and should be treated as such, and so we made adjustments to our own internal numbers. Furthermore, I observed that their options compensation for executives was much higher than should be for such a small company. Management continued to grant options despite the company’s underperformance during the pandemic. I realized that as the stock continued to decline and those options lost value, management would be forced to issue even more options (diluting existing shareholders) or risk losing executives seeking greener pastures.
There are additional bullets to my exit decision, but I will leave this as it is. I am happy to put that one behind us."