Visit to GGNC!
Let me first offer my full disclosure. I am LONG on GGNC, always have been, hope to be for a LONG time. I have the luxury of living in the beautiful Northwest which make GGNC a convenient stock for me to own as I can do a more personal job of DD. I did visit them back in aprox. Dec. while past management was in place. During my first visit James Chu was in town so I also had the chance to shake his hand and chat for a bit. I'm sure my post will bring criticism and questions. Let me say this - this is my investment and my opinion - if you don't like it too bad, if you ask question I will do all I can to answer them with what I know. This is all my OPINION, the information listed here is my analysis of the same information you ALL have access to if you would phone or visit with these guys.
I met Keith at 2:00 Wed. afternoon the meeting lasted for 2 hours. Both Sean and Keith were present but Keith was busily responding to investor calls (probably you guys hoggin up the phone line). They were pumped about the day - its when we closed around 3.00.
Most of our conversation centered around credibility related issues. In my mind the facts are simple - if they ARE doing what they tell us then this is a big time undervalued stock, especially in light of the recent SNMM craze.
I spent a good deal of time on the James Chu side of things. They were open and honest in describing a well connected, visionary guy who wants to win this online gaming race with a passion. Despite some of GGNC's shortcomings, in part due to the quick change in management recently, he is committed to staying the course and proving all those naysayers wrong. There are lot's of deals in the works and in Keith and Seans view he now has a stable office team to manage the store. (As I look back over the past 2 months, everyone was throwing stones, doubt, and conjecture, all with pretty good reason - but much of that was due to an apparent stall in progress which was the natural result of change) The change has brought some new faces to the team, they IMO are qualified, committed, and will keep things moving forward.
They recognize the credibility issue and are diligently working toward becoming fully reporting and NASDAQ. The natural consequence of a rapidly growing company however is that as they expand and acquire - all divisions must comply to the standard and so they are stuck a bit. They want to acquire yet their due diligence must be completed to keep the GGNC auditing work going forward. (If they hire an unaudited company, then it complicates their internal books and slows things down a bit) Currently they have several new deals and acquisitions to announce - they desperately want to conquire all fronts of the investors curiosity but can only go so fast. Keith made it a point to say that GGNC will have it's day - and it will surprise us all.
I asked about the DRF - the deal is there but the technology needs to be developed to capitalize on the new relationship. Perhaps you guys more versed in the computer lingo could ask better questions about what this means.
I asked about updates concerning new deals and acquisitions, he said they have 2 ready to announce and could not give any more details. We all know of the sportsbook - 100 mill. in revenue and PROFITABLE. An announcement of this would IMO have significant impact on our price. He said their 1st year proj. of 500 mill. is on track with the deals in the works.
He mentioned a second casino in the works - no details. If this has half the success of CyberBetz it will be great news.
I asked lots of specific questions, many of which he could not answer. I was actually impressed with what he DID NOT tell me. I know you all would prefer me to come back with a bunch of new information but the fact is he could not tell me anything he has not already told you guys. IMO it's all part of there commitment to build credibility.
Hope this helps. If there's not enough meat on this bone then please feel free to ask questions - or call them yourself - Keith and Sean were very adept at answering enough of my questions to confirm my LONG position.
Good luck everyone! |
