I DON'T discount Little Engine's comments, just because he's got a rather pessimistic and contentious attitude. He has made some very solid points that should be assessed on the basis of their validity, not the sentiment in which they are couched. I'm not able to certainly counter Little Engine's critique and I am quite heavily invested in this stock--so I'd really like to be able to. I can say, Little Engine, that it is quite possible that the larger employment companies you cite are generating a significant portion of their gross revenue through providing payroll services (which have profit margins of just a few percent.) This is the type of revenue which, I believe, Myriad generates, and is the reason a relatively unknown company (Myriad) can have revenues of 50+ million. These types of companies basically just handle the payroll for corporations, perhaps take on some of the employee liability, and take a sliver of the money running across their books. If Firamada was not (in 1997) in that end of things (I believe it was not), it would make sense that its net income represented a higher percentage of gross revenue, since the gross revenue would be for actual employee placements, without payroll services. Furthermore, Ira did seem to state that in 1997 that had several fortuitous instances of pure profit, which would certainly tilt the books a bit more, although it would possibly seem to contradict his statement that the incoming was of a "recurring" type.
Anyhow, there are, once again, explanations aside from Firamada being, as you are suggesting, some type of fraud. In fact, there are explanations other than what I have listed above. For this reason I feel that you, just like the ostriches here that like to resort to personal (rather than substantive) attacks, need to take a good hard look at your underlying beliefs and motives.
Jim |
