Five weeks ended February 12 in review
My apologies for neglecting the board for a while. Other more pressing matters took precedence.
For the FIVE weeks ended Friday, Intrawest fell 9.9% on the TSE, 6.6% on the NYSE to 24.95 and 16.875 respectively.
Though lots of good news has come to the table since I last wrote, it's something of an understatement to say that the market took a slightly less bullish view of it that I might have.
First the good news.
1. The US economy continues to be strong.
2. The Senate finally figured out that, bad as visions of their leader getting a quickie in the Oval Office might be, equally repulsive was the image of old men (each possessing equally well "skeleton-stocked" closets) wag their bony fingers at the most popular President of our time.
3. Intrawest reported a 9% increase in same-resort skier visits so far this year.
4. Intrawest reported the sale of $53,000,000 worth of new housing at their Copper Mountain Resort. Moreover, they did that in a matter of 8 hours or so.
5. Intrawest added Blue Mountain (Ontario) to their stable of resorts.
6. Intrawest inked a deal with J.D. Edwards to develop a new information management system. Like Oracle and SAP, JDE's products convert raw data into focussed, action-oriented management reports. This is critical for a large, distributed organization like Intrawest, which plans to become even larger and MORE distributed in the future.
7. Intrawest resorts are showing exceptional snow cover going into this coming holiday week. Preliminary reports suggest that several of their resorts (Whistler in particular) will break previous President's Week revenue records on a huge influx of cash rich skiers.
The bad news?
1. Continued worries about the stability of Brazil's economy and the destabilizing effect this uncertainty is having on all Latin American economies.
2. There is worry that Japan's continued banking problems may accelerate repatriation of Japanese equity and bond market funds. Higher interest rates and a slumping stock market would not favour Intrawest.
My call for the future?
I remain quite confident. While Brazil and Japan are very real concerns, they are macro-economic issues that tend to dominate "front of mind" issues for relatively brief time spans. Though I continue to monitor them, day-to-day market activity has and always will be dominated by daily developments that can be easily and directly linked to particular stocks. On review, I can see nothing but positives when I review the news that continues to surround the Intrawest resort network.
Bold as it may seem, I continue to hold the view that Intrawest's legitimate short-term target is $32. We will see in a couple of weeks whether my confidence has been well founded.
Thomas |
