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Strategies & Market Trends : Turnarund Investing
NOVS 0.0666-16.0%Aug 1 5:00 PM EST
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To: bankbuyer who wrote (994)5/3/2012 11:13:48 PM
From: Covenant  Read Replies (1) of 1876
 
I haven't spoken to DMND's ex CEO in about 25 years. He was always a popular guy who used his likability to get things done rather than rely on sound planning. Corners were often cut. He may be gone from the company now, but I would be shocked if business was done any way differently than Mike would do. This means systems and processes are likely very weak with informal means being the way to accomplish things. Cost of goods sold for walnuts all the way from paying farmers to recording the costs in the books are merely symptoms. The cause is the underlying company culture.

You can be sure the farmer suppliers are more than a bit upset. These suppliers do not have to sell to DMND. Relations will need to be mended.

The company needs an awful lot of changes, and changes cost money. DMND has fallen enough that shorting is no longer free money, but it is hard to understand why buyers are willing to pay the current rich price for the stock.
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