RE:RE:RE:PriceMephistopheles3 wrote: Assuming there is no transaction announced in two weeks, we will likely see the stock price crater, possible in the low $4 or dip into the $3 range.. at this point, I think it would be great to get in.
It's not all blue skies ahead - I think your point on analyst targets is good.. they are mostly useless and just make up targets all day long. It's really up to CTS to show some good metrics, they've been talking about getting synergies and reducing overhead expenses.. but they need to actually do it vs. just building the team.
Don't put your hopes up on share buybacks happening anytime soon, they are too leveraged as it is now to do any more share buybacks. Still bullish here - but looking for some more weakness / short attacks before increasing position.
Good post.
First, i doubt Meph is short CTS. I believe he mentioned he purchased CTS shares after news of the strategic review was first made public (?), so he could be currently sitting at an average cost per share in the 4.00 range and may consider adding if the share price drops this low again post earnings release....?
In my view, at this point in time, small cap companies should only be buying back shares if they have a solid balance sheet with low debt and cash to spare, not companies like CTS that carry too much debt in an environment of rising interest rates, stubborn inflation, and the risk of recession. When times are tough and you are a small cap company that borrowed and grew too much too quick during a period of rock-bottom interest rates, the best use of any extra cash you have available right now is to pay down that debt. We shall see on March 16 exactly how much debt CTS was carrrying as at December 31, 2022 and what their Current / Quick / Debt-To-Equity etc. Ratios were.
Lastly, my hunch is, if there is no takeout of the company and it's business as usual, CTS's share price is not going to rise signficiantly higher and stay there until inflation is tamed both in Canada and the USA, a recession (if one occurs) is endured and nearing an end, and interest rates start coming down. In the meantime, CTS may be dead money.