To: Hassan Lakhani who wrote (81 ) 2/17/2000 11:20:00 PM From: Jay Arkay Read Replies (2) | Respond to
Can't say exactly when the market will recognize real value (and growth) of Dorel, Hassan, but in due time it will. The conference call is well worth a listen. The Schwartz brothers went through the financials and current year outlook. Perhaps most notable bit of info that was not (as I recall) in the year-result news release is that they expect this Q1 to have slower sales growth (year-over-year) because Walmart is rolling out their new products in Q2 this year rather than Q1 as they did in 1999 (which was why Q1 last year was so strong in sales and made the rest of the year look slower in sales growth than what we have been accustomed to for Dorel). But never fear, they will (they state) capture this sales surge in Q2 this year. Their presentations and responses to analysts' questions (7 analysts in all, by my count; biggest names were Bunting Warburg and Goldman Sachs but also Sceptre Investment Counsel) were all forthright and candid, no attempt to hype in any way nor any attempt to conceal anything (as far as I could detect). Almost all of the analysts congratulated Dorel management for a "great" fourth quarter and year. Oh yes, one other interesting point. Schwartz said that the share buy-back is in place mainly to stabilize the market price for Dorel, which is pretty illiquid, and to prevent big share moves (mostly downward) on very small volume. I don't think they have been all that successful in their share stabilization operation, but in the long run that is really a minor sideshow to the company's continued great operating and financial performance, which will drive the share price much higher in due time.
