Pardon me if I don't have my order of events down pat because I'm just going from memory but here is the BS we've been fed from this CEO all the way down from $16:
1) Company issues guidance of somewhere around $1.90 a share after aquiring Seroyal and never really revises it. They actually kind of reaffirm it on the Q1 conference call by suggesting that it is still intact with the exception of additional market spend in Germany which seemed to be around .10.
2) Disappointing Q2 with the expiration of a major private label contract. Wasn't very well telegraphed and wasn't this obvious when they gave guidance which they still didn't appear to adjust.
3) Disappointing Q3 due to a "delayed European shipment lag" It is strongly suggested that this bonafide Q3 revenue can easily be tacked on to Q4 which should mean a much improved Q4 for Europe. DTC was also basically shut down for compliance reasons.
4) Despite the shipment lag recovery in Q4, Europe still stinks begging the question why did they even mention this shipment lag in the first place? Secondly, EBITDA margins drop off a cliff partially because of rising European ingredient costs which was poorly telegraphed. Stock tanks and management appears to do the right thing by buying 800k shares.
5) We can all breathe a sigh of relief in Q1 as margins and DTC have stabilised and "will slowly improve quarter to quarter." With a slight improvement in Europe and a telegraphed decline in private label, management appears to suggest they are lining up for selective aquisitions after earlier saying they were in a holding pattern and at 3.1 debt. Just like that, they abandon the 200k/quarter run rate they'd had on buybacks even though the stock remains at 5 year lows. Margin story is now mostly about GMP compliance.
6) CEO gives viral published interview in which he is now back in a holding pattern and paying down debt (a little bi-polar but glad to hear it and seems like a good reason to halt the buyback) He goes on to say that he thinks the stock is cheap and the margins have stabilized. Appears to be a pretty confident guy with a pending Q2 release?
7) Q2 EBITDA margin gaps down (unless you exclude that "stabilised" DTC business and the fact that GOL is growing too fast:). Where does this stuff come from?
Someone please feel free to correct me if I've accidently mistaken any of the facts but this CEO is either spinning his mistakes quarter to quarter or simply does not understand what is going on in his business? One reason I'm invested heavily in this company is because it has a fairly reputable board who has done nothing wrong. But I believe that they are at a crossroads where they should either replace the CEO or put the company up for sale. I 'm not always a fan of the quick sale over long term appreciation but the shareholders of this company deserve to be made whole ( and most of them would be) given the load of BS they've had to put up with for the last couple of years. Despite everything, this stock is dirt cheap and has very little downside. Problem is that there is going to be very little multiple expansion under current leadership and fair value could be far greater than the normal 20 to 30% buyout premium. There are plenty of buyers for a business like this. At the very least, we need a credible CEO who can properly communicate what is going on. That alone would get us back to $15.
All of this of course is strictly in my opinion.