Quote:
Originally Posted by JPB383
Are there any real assets there/any real upside in their business? What went wrong? Is it simply the same market factors affecting all big box retailers?
p/s amzn 2.46 revenue growth 13%
p/s hgg 0.02 revenue growth -10%
Imagine hgg can earn 5% profit, or 1/2 the average sales tax.
that is 100 MM in profit there are 27.7 million shares outstanding.
Thus they would earn $3 a share. Put a 15 multiple it or $45 a share.
1. Are there any real assets there/any real upside in their business?
They have inventory, I don't know if they own their real estate, low or no debt. THey are cutting costs and were actually profitable in last quarter (if you exclude depreciation and asset impairment). The upside is $45 a share or more, without any growth. There is no guarantee amazon grows one more day and when all their minimum wage employees and drivers demand wage increases or form a union, watch margins drop.
2. Is it simply the same market factors affecting all big box retailers?
Seems their main business is appliances. Thus they are now getting competition from lowes, hd, amazon online, and even ebay. However yoy was an improvement. But real test is next quarter. There is a chance they are trying to destroy the company to get it cheap for insiders. Today there is so much fraud in the markets, that there really is nothing you can do about it and no one is enforcing it, the SEC is eating paint chips.