TLW59, It's my blanket and I'll stay under it as long as I like. And an "agreement in Principal" is a good thing when the alternative was to wait 'til November for another hearing which would result in waiting 'til February, etc., etc.
Araldica needed to get the suit settled. It is good that they have agreed on a purchase price and it will be great if they come up with the money and close the deal in September. It is smart and cost effective to move the corporate headquarters to Goshen, (Goshen!). The $250,000 profit on $6,500,000 in sales is the end point for Swan and the starting point for Araldica. This business hasn't grown for ten years. If Swan had wanted to be active in the top management role and really run-up the business, I bet he could have had revenue of $12,000,000 by now. And I bet if you asked him that he would agree.
There is great growth potential in the business and as revenue grows more margin ($ & %) will be converted to the bottom line. Danielle will be Araldica's ticket to the future. I don't know the terms of the debt pay off but they will have to be achievable with current revenue and profit or Araldica wouldn't want the deal. When revenue grows 25% and if margin on incremental revenue increases, there is a source of real cash money that can be leveraged into additional acquisitions and accelerated pay offs. Danielle has been "not too exciting" but the NEW Danielle/Araldica combination has synergy and excitement written all over it.
And I wouldn't attribute today's AWLT price action to the 300 point down day in the Dow. AWLT was level today because of the terrible things that have been said by supposedly reputable people. Twisted, uninformed, and unimaginable are words that describe the views of those who have turned what was a good healthy penny stock opportunity into a vehicle for discord, discontent and despair. A lot of scared shareholders sold today on the news. A lot more held today and will see what the future brings. I am one that held.
Slim |
