My Analysis/Opinions:
Bosco,
My concerns (everyone has concerns today, but I may have concerns that a lot of others don't; but for what it's worth -- here they are!) Nothing personal:
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1) The balance sheet is average at best. (Not to mention debt downgraded today.) I believe it will only get worse from this point forward -- unless corrective actions are taken.
2) The "looming" telecom slowdown can only increase CDO's exposure to VC losses.
3) Management hasn't effectively communicated with the street.
4) Management is a "day late, dollar short" with many issues. Coincidence or is someone to blame?
5) CDO does not have a clear cash flow picture going forward -- if there is a tech slowdown.
6) Management has not communicated the organic business strategy to the investment community.
7) The company has put way too much focus upon the VC field, instead of internal operations. This has resulted in a poor internal growth rate and deterioriating balance sheet.
8) Some of the management personnel appear to be in their positions due to heriditary reasons and not for reasons proven in the business community. Unless one is Bill Gates, at least put someone in the CEO position that has a bachelor's degree. Kind of a disgrace that the CEO has "attended college" -- what is that? My plumber attended college. Enough said.
9) Public relations, in my opinion, is incompetent -- and should be outsourced if the company can't do it themselves.
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Sorry for being so pessimistic, but this ordeal has unraveled in a very slow, predictable manner. First the Prism situation, then the VC IPO delay, poor PR throughout, moves that appear to show lack of management leadership and unseasoning exist even today. On the positive side, they are feeling our pain. They own over 30% of the company.
My reco's for what it is worth:
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1) Put in different leadership at the CEO position. Family is nice but I don't want my sister running my companies that I have money invested in. I want an educated (i.e., MBA) executive with plenty of business experience.
2) For the sake of Warren Buffet, please clean up the balance sheet. Put any free cash flow (from internal operations and/or stock sales) into paying down the debt.
3) Cut all losses than in any way may resemble a PRISM.
4) Do not buy back any stock until the company's finances are cleared up. Do not participate in any VC's adventures until the stock can stand on its own. It clearly can not right now.
5) Let the new management focus, and communicate, upon what the company's mission statement is for the future. Web hosting -- great. Whatever it is -- focus upon solid growth industries and divert funds and energy into these businesses. These games and incompetent mismanagement actions are a disgrace.
6) Hire a competent PR staff or outsource. Next hire investment relations personnel that know how to answer the phone, send materials timely, etc.
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Sorry to say this, but I think I could walk into the office tomorrow and make more of a difference than the current team in place. And I don't even know what floor I would work on, what airline I would need to fly in on., etc.
Simple issues. Many of these mistakes were avoidable.
Once again, sorry for venting but effective leaders manage, lead, communicate, and produce. I have to ask if Nick would be in his position if it were not for his father.
The reason I haven't posted is due to my concerns with CDO's management, IR, and PR. I attempted to communicate issues with the company and did not feel comfortable with the outcome -- if you know what I mean...I will leave it at that. Not very professional, timely, or investor responsive.
Sorry for not responding previously to the people who sent me PM's regarding my lack of posting on the other thread. I was hoping CDO would correct a few issues prior to my posting any negative thoughts.
Just my opinion,
I hope everyone has a great day. It's only a stock. The company does have value. I don't know if they have the management team in place to exploit the value, or the management team to refocus energies upon appropriate venues, or anyone who can do anything about the "family" issue. |
