Is anyone else riding the CLCT train? I don't think it has any brakes!

opportunity

Up well over 350% since March something, and by far at an all time high.

Zoins

You won't be able to ride it for much longer!

Collectors Universe to be Acquired by Investor Group Led by Entrepreneur and Collector Nat Turner for Approximately $700 Million

Collectors Universe, Inc.
Mon, November 30, 2020, 6:24 AM PST

Collectors Universe Shareholders to Receive Immediate and Certain Value of $75.25 Per Share in Cash

Fully Financed Transaction Represents 30% Premium to 60-Day VWAP

NEWPORT BEACH, Calif., Nov. 30, 2020 (GLOBE NEWSWIRE) -- Collectors Universe, Inc. (NASDAQ: CLCT) (“Collectors Universe” or the “Company”), a leading provider of value-added authentication and grading services to dealers and collectors of collectibles, today announced that it has entered into a definitive agreement under which an investor group led by entrepreneur and sports card collector Nat Turner, D1 Capital Partners L.P., and Cohen Private Ventures, LLC (the “Investor Group”) will acquire all of the Company’s outstanding shares of common stock for $75.25 per share in cash.
[...]

Read more:

https://finance.yahoo.com/news/collectors-universe-acquired-investor-group-142400274.html

ChrisH821

Wow!

opportunity

@Zoins said:
You won't be able to ride it for much longer!

Collectors Universe to be Acquired by Investor Group Led by Entrepreneur and Collector Nat Turner for Approximately $700 Million

LOL what? What are the implications of this?

edit: Wow, I had no idea they were going private. Holy cow.

Zoins

@opportunity said:

@Zoins said:
You won't be able to ride it for much longer!

Collectors Universe to be Acquired by Investor Group Led by Entrepreneur and Collector Nat Turner for Approximately $700 Million

LOL what? What are the implications of this?

edit: Wow, I had no idea they were going private. Holy cow.

Looks like the sale may have been partially defensive against Alta Fox. Nat Turner and team are keeping CEO Joseph Orlando.

Collectors Universe Investor Seeks to Replace Board

By Scott Deveau
June 18, 2020, 8:58 AM PDT

One of the largest shareholders in Collectors Universe Inc. is seeking to replace its board, arguing the company could be worth $100 a share within the next three years under the right leadership. Failing that, it believes the company -- which opened at $26.99 Thursday -- should consider going private.

Alta Fox Capital Management, which owns a 5.4% stake in the authentication company, argued in a letter to shareholders Thursday that there are several levers it could pull to drive operational efficiency, profitable digital innovation, and shareholder engagement. But, in order to do so, it said it needs a more engaged board.
[...]
While discussions with Chief Executive Officer Joseph Orlando have been “amicable,” the rest of the board was “largely uninterested in listening to its suggestions” and said it would no longer engage with Alta Fox, the firm said in a letter reviewed by Bloomberg.
[...]

https://www.bloomberg.com/news/articles/2020-06-18/collectors-universe-investor-seeks-to-replace-board

TurtleCat

@opportunity said:

@Zoins said:
You won't be able to ride it for much longer!

Collectors Universe to be Acquired by Investor Group Led by Entrepreneur and Collector Nat Turner for Approximately $700 Million

LOL what? What are the implications of this?

My guess is CU will be retooled to maximize profitability. That’s typically the equity owner playbook. So they will be watching their EBITDA closely. If my experience in a different sector is any indication they will aim for 40-45%. So either raise revenue or cut expenses, preferably both.

Zoins

At $76.99 now.

Fingers crossed for the forums!

BryceM

Wow. I have a token number of shares...... Been good so far, but sounds like times are a changin'.

opportunity

@Zoins said:
At $76.99 now.

Fingers crossed for the forums!

Are you saying they may shut them down?

Zoins

@opportunity said:

@Zoins said:
At $76.99 now.

Fingers crossed for the forums!

Are you saying they may shut them down?

Nope! I don't even want to think that!

Zoins

Wow, the high today was $81!

Zoins

Wow, Nat Turner is a serial entrepreneur who graduated with a bachelor's degree in 2008, sold a company to Google in 2010 and another to Roche Group in 2018.

This should be a good sign for growth vs. traditional private equity.

https://natsturner.com/about

Welcome to my blog. I was born in Houston, currently live in New York City, and have lived in a bunch of other places, including Louisiana, The Netherlands, Scotland, and Philadelphia, PA. I went to school at The University of Pennsylvania (Wharton School), graduating in 2008 cum laude with a B.S. in Economics.

I’m an entrepreneur and designer by trade. I started several companies before I went to college (and one before high school), including a web development and hosting company, a reptile-breeding operation (seriously), and a website allowing users to buy/swap gift cards called CertificateSwap. In college I co-founded an online food ordering website with a few classmates. In 2007, I co-founded and was CEO of Invite Media, an ad technology company that built a media buying software platform for banner ads. We were acquired by Google three years later (June, 2010). I then spent two years with the Invite team integrating the business into Google, which has continued to grow significantly. In 2012, along with my partner Zach Weinberg from Invite, I co-founded and was CEO of Flatiron Health, a healthcare IT company focused on accelerating research in oncology. Flatiron Health was acquired by the Roche Group in February, 2018.

In my free time, I enjoy golfing and fishing as well as playing basketball. I am a big music fan. I am also an avid sports card collector, ranging from modern basketball to vintage baseball and golf cards.

I am also now doing angel investing with Zach.

opportunity

@Zoins said:

@opportunity said:

@Zoins said:
At $76.99 now.

Fingers crossed for the forums!

Are you saying they may shut them down?

Nope! I don't even want to think that!

I really hope not. I don't think they would do that.

TurtleCat

@opportunity said:

@Zoins said:

@opportunity said:

@Zoins said:
At $76.99 now.

Fingers crossed for the forums!

Are you saying they may shut them down?

Nope! I don't even want to think that!

I really hope not. I don't think they would do that.

I seriously doubt they would do anything with the forums. It’s a very cheap way to have engagement with their core customers. If anything, they might find a way to encourage more engagement from employees. It would be effective and inexpensive and potentially lead to greater satisfaction which tends to lead to the core spending more.

skier07

I’m certainly not a financial wizard but this doesn’t sound good to me. Public company going private to maximize profits and then perhaps going public again doesn’t sound like it’s in the little guys best interests.

DoubleEagle59

@skier07 said:
I’m certainly not a financial wizard but this doesn’t sound good to me. Public company going private to maximize profits and then perhaps going public again doesn’t sound like it’s in the little guys best interests.

Nothing usually is.

291fifth

Have the fundamentals been tossed out the window?

Goldminers

Price to earnings is already high at 52, and the dividend down below 1%.

1630Boston

.

Randoms

I know there has been an influx of graded Pokemon cards. CGC has gotten into Magic the Gathering. Grading must be fairly lucrative recently.

ricko

Well now...... Reminds me of the ancient Chinese curse -"May you live in interesting times." Usually results in restructuring and mid to upper level personnel changes. Cheers, RickO

nwcoast

@ricko said:
Well now...... Reminds me of the ancient Chinese curse -"May you live in interesting times." Usually results in restructuring and mid to upper level personnel changes. Cheers, RickO

Well RickO, we can apply that to several aspects of our lives these days!
We are living that curse!
Fortunately though, we had it good for a very long time beforehand.

ReadyFireAim

@TurtleCat said:
So either raise revenue or cut expenses, preferably both.

Newport Beach, California is expensive.
They could move to Pittsburgh.
Just a thought.

Mgarmy

An East cost office would be awesome

TurtleCat

@ReadyFireAim said:

@TurtleCat said:
So either raise revenue or cut expenses, preferably both.

Newport Beach, California is expensive.
They could move to Pittsburgh.
Just a thought.

I understand why it was founded there given David Hall, etc but you’re right. Establishing a presence in a less expensive area would save a great deal over time. The problem would be relocating the talent.

TwoSides2aCoin

Sold all but 5 shares. A token nickel's worth. ( (as it were)

Catbert

Having an investor who understands the collectibles market is a big plus. Many of these private equity firms know little beyond the numbers of what they are buying and make expensive management mistakes that often tank their acquired company. Retaining the current CEO is not unusual at least through a transition period.

291fifth

@ricko said:
Well now...... Reminds me of the ancient Chinese curse -"May you live in interesting times." Usually results in restructuring and mid to upper level personnel changes. Cheers, RickO

... and lots of them.

mcarney1173

When was their IPO?

TurtleCat

@mcarney1173 said:
When was their IPO?

9/1999

Higashiyama

@ReadyFireAim said: They could move to Pittsburgh.

With the relatively reasonable cost of living and tech talent at Carnegie Mellon, that’s not a bad idea!

philographer

Steve Cohen is in the mix.

https://www.bloomberg.com/news/articles/2020-11-30/steve-cohen-and-d1-capital-team-up-to-buy-collectors-universe

Cohen Private Ventures, which invests the personal capital of hedge fund billionaire Steve Cohen, is teaming with Dan Sundheim’s D1 Capital Partners and sports card collector Nat Turner to take collectibles-grading company Collectors Universe Inc. private for about $700 million.

The deal represents a 3.7% premium to Friday’s closing price of $72.55. Shares of the Santa Ana, California-based company have more than tripled this year as consumers dedicate more time to hobbies like collecting during quarantine and lockdowns. Collectors Universe provides authentication and grading services to buyers and sellers of memorabilia, including sports cards, coins and vintage autographs.

...

BAJJERFAN

@Goldminers said:
Price to earnings is already high at 52, and the dividend down below 1%.

Normally a higher share price results in a lower dividend percentage. Frankly, I'd rather have the higher stock price.

CopperWire

This will destroy the value of PCGS graded coins. The 3rd-party neutrality concept that garners trust from collectors will be absent. Gradeflation for profits anyone?

3stars

Guess Mets player cards will get higher grades

Tomthecoinguy

I think it is very interesting that the market price of CLCT is higher than the offer price. This must mean that the market expects another offer, or the current bidder to raise their offer.

It will be interesting to watch this all unfold.

ike126

Makes me wish i was able to buy more shares in June but hey im still happy!! Im curious of why NGC doesnt have anything??

johnny9434

Amazing

OldIndianNutKase

I forsee that they perceive that grading fees are under valued and that they can share in the upside of grade inflation based upon price differential on grade reassignments. This will not be a stabilizing event for collectors.

OINK

jmlanzaf

@OldIndianNutKase said:
I forsee that they perceive that grading fees are under valued and that they can share in the upside of grade inflation based upon price differential on grade reassignments. This will not be a stabilizing event for collectors.

OINK

It is quite possible that they believe they can increase volume without a need to inflate grades or change grading fees.

These are smart people. They must know that intentional grade inflation all but killed ANACS and PCI as competitors.

amwldcoin

I'm curious how much moving out of California to the more affordable states would increase their bottom line. I would wager it could be in the 20% or more range. I also wouldn't worry about convincing employees to follow along unless they decide to cut their pay because their cost of living would go down so much!

TurtleCat

@amwldcoin said:
I'm curious how much moving out of California to the more affordable states would increase their bottom line. I would wager it could be in the 20% or more range. I also wouldn't worry about convincing employees to follow along unless they decide to cut their pay because their cost of living would go down so much!

It all depends on where they would go and whether they would enjoy living in the new area. It’s tricky to uproot people. Only the graders would be moved, though. And since many (all?) have/are/will be dealers they have to consider the market for that. Internet buying does help, of course.

I think they would do it in phases. They could establish part of their business in one location and slowly grow it and move over other business functions as it makes sense. That would probably be the first sign of a big relocation. Although they recently acquired real estate near them so I doubt it will be anytime soon.