Folks: I am really surprised to see so little interest in such a great story.
Let's look at what was keeping this stock down in the past:
1/ Flat sales
Mgmt intend to maintain SSS. With 2-3 new stores per Q, we can reasonably expect a 5% growth per Q this year.
2/ Decreasing OM
OM jumped to 19% (their highest ever), in spite of ad and reorg costs (some of them may have been accrued in Q4 though, see above).
3/ Decreasing SSS
SSS were positive for the first time since a long long time (+1.5%), and management provided a clear tactical plan to make sure it stays on the + side (ad, strategic location etc... (see 10Q)
Moreover, this company has a reasonable debt level (int exp=1.8%, down from 2.2%), a number of shares remarkably constant (9.3m for 1y), and ample access to K.
If GRLL does not qualify has a company being turned around, then what does ?
On the negative side, Last Q, the new management "loaded" their numbers in Q4 to have a good start for their first full year. Which could be noticed by an unexplained rise in "other op exp" as a proportion of sales (this number has always been fairly constant in the past).
They also operate in a competitive environment, esp. in FL. They are a mid-size player (#4), which is often a disadvantage.
All (facts-based) comments welcome.... |
