CU stock now up to $10.50

Buckwheat

The stock is up today to triple where it was in October. MW must be having some bad heartburn.

Here is an example of MW's postings from the SGC board where he speculated in October that CU may fold soon. He later in the same thread compares those who buy PSA stock at $3.50 to those who would fall for Nigerian money transfer scams.

QUOTE: (paste from SGC site)
Collectors Universe -- another dismal quarter of losses. PSA to fold?
#274073 - 10/01/03 10:09 PM
Edit post Edit Reply to this post Reply Reply to this post Quote

For those who have net yet seen it, Collectors Universe recently filed its fourth quarter and year end FY 2003 reports with the SEC.

From Edgar Online:

Form 8-K
September 29, 2003
COLLECTORS UNIVERSE REPORTS FOURTH QUARTER
AND YEAR END FISCAL 2003 FINANCIAL RESULTS
COMMENTS ON PRELIMINARY FIRST QUARTER 2004 FINANCIAL PERFORMANCE

ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.


2003 Fourth quarter results: $1.288 million in net losses:

"For the fourth quarter ended June 30, 2003, the Company reported a pre tax loss of $2,646,000 or $0.43 per basic and diluted share and a net loss of $1,288,000 or $0.21 per basic and diluted share, as compared to pre tax income of $83,000, or $0.01 per basic and diluted share and net income of $148,000 or $0.02 per basic and diluted in the fourth quarter of fiscal 2002."


FY 2003 results: total net losses over $10 million:

"For the fiscal year ended June 30, 2003, the Company reported a pre-tax loss of $3,627,000 or $0.58 per basic and diluted share, a net loss before a previously reported $8,973,000, or $1.45 per share, non-cash goodwill impairment charge (recorded as the cumulative effect of an accounting change in the first quarter of fiscal 2003), of $1,466,000, or $0.23 per basic and diluted share, and a net loss (which includes that non-cash goodwill impairment charge) of $10,439,000, or $1.68 per basic and diluted share."


Net cash down. Sharp decline in total assets and stockholder equity:

"Net cash used by operations was $167,000 for fiscal 2003. At June 30, 2003, cash and cash equivalents totaled $4,482,000 compared with $4,947,000 at June 30, 2002. Assets totaled $32,291,000 at June 30, 2003, compared with $45,509,000 at June 30, 2002. Total stockholders' equity was $26,319,000 at June 30, 2003, compared with $37,128,000 at June 30, 2002."


Statement by the CEO:

"Commenting on fourth quarter and fiscal 2003 results and fiscal 2004 outlook, Chief Executive Officer Michael Haynes commented, 'We are disappointed with the our fourth quarter and fiscal 2003 operating results…'"


Observations:

With the continuing unresolved WIWAG/PSA holder scandal, rampant customer alienation with egregious price increases (planned) and re-instituted club memberships, as well as the alleged expenditure of large sums of money for the new PSA holders, I would look for these trends to continue (or even worsen).

AND ANOTHER QUOTE from MW

Quote from another poster:
There are people out there who would purchase the PSA business model.


MW1:
And there are also people out there who would help rogue foreign nationals transfer large sums of money out of war-torn African countries by eagerly supplying their personal bank account information.

dalew

I was going to buy a thousand shares of that stock when it was in the $1.00+ range. Boy, if I had, I'd have a heckuva profit.

At least my bank stock is up $17.00 a share.

Dale

koby

Looks like MW was wrong about many different things. Hopefully not too many collectors got burned by listening to MW's advice.

Vargha

I guess we all should have invested in it at a buck. Then we all could have bought more cards in their holders.

psa10fan

In case you didn't see the news, the current CU stock price reflects a 1 for 4 stock split effective December 9. This was done to keep the company from being "delisted" from the stock exchange, as the share price had drifted below $1.00 per share.
So, for every four shares you previously owned, you now own 1 share. That means the current adjusted value of your shares would be 1/4 of the current $10.50 share value, or $2.62 per share. Still, not a bad return if you had bought it at $1.00 prior to the split.

mrc32

WOW a reverse stock split is never ever good news.

dstudeba

What I find humorous about MW's insinuation that PSA has a poor business model is that I think he believes that SGC has a good business model. I personally would not invest in PSA's business model, but I am less inclined to invest in SGC's.

shagrotn77

With the continuing unresolved WIWAG/PSA holder scandal...

What is this all about?

Tipem

I guess we should have paid more attention at the National luncheon.


Vic

onegaucho

I bought the stock a few years back when it was in the $2-3 range - after the market crashed.

The split was in 2002 (Dec. 9) so the stock has been doing well as of late. I'm waiting for the new year to come in so I can cash out (and take the profit in 2004 instead of 2003).

calleocho

i thought the split was 3 to 1

even after the reverse split the stock was around 4 bucks ...thats a hell of % increase

beefcake210

4 for 1 split - after the split, the stock dropped as low as $2 post split ($.50 pre) - so from that point, it's gone up 500%+.

Buckwheat

onegaucho is correct. The reverse split was 12/9/02, and was 1:4. The price before the split was .87, and after it was $3.48.

It subsequently reached a low this spring of $2.00. It at about $3.25 when the CEO gave his presentation at the luncheon. It was at $3.79 on November 13th when this run started.

Hummingbird Management, LLC (f/k/a Morningside Value Investors, LLC) has purchased over 7% of the company as of Nov 19, spending over $2 million dollars. Large numbers of shares have continued to trade since that date, sugesting theyhave continued to buy more, or that other mutual funds or investors are acquiring shares. David Hall, president of CU, purchased 5000 shares on Dec 11th at $6.95 per share.

psa10fan

My apologies; I was given bad information; should have checked it out. Many of you obviously follow this much closer than I do.

Buckwheat

psa10--Your info was correct. Just add a 2002 to the split date.

shagrotn77

Buckwheat,

What is the WIWAG/PSA holder scandal all about???

VaYank

Buckwheat wins the prize. Morningside is essentially buying out CU.
CU IOP'd at $6, was it? Converted for the 4 to 1 split, the stock would have to be worth $24 for an investor, who bought on the IPO to break even. That $10.50 is considered a success is a study in diminished expectations.

Morningside sees a company that had lost 80% or so of its stock value, yet has some strong brands, which are not being maximized. It was precisely because the stock had fallen so low, yet still has these brands, which made it attractive. I don't think Morningside is doing all this to keep CU the same. What this means for PSA is anyone's guess. Another interesting fact is that CU recently put a former US mint big wig on the Board. Does this mean a future focus on coins?

While this all is happening, much, maybe all of the CU BOD has been given 15,000 share chucks of stock. I assume this is to guarantee them some sort of pay day, should morningside excert more direct control over the board or takes majority control.

edited for syntax

beefcake210

Even at the present day price of $10.60, that puts CLCT at a market cap of $65M - that's a lot of money to pay for brand names in the collectibles field. The P/E ratio right now is scary after only one profitable quarter.

With the insiders still owning much of the company, I'm sure a deal is in the works - at least we're confident that the demise of PSA/CLCT has been greatly exaggerated.

pc

well i suppose a lesson here is that reverse splits
can be bullish after all.i recall having been challenged
on that statement.seemed to me less shares available
for sale or purchase could have a profound effect on a
share price if demand later appears.