Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (1) | Ignore Thread Prev Thread | Prev | Next | Next Thread
Author: Swede46 Big red star, 1000 posts Global Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 259  
Subject: Interesting info in 2nd qtr report Date: 8/9/2012 12:41 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 7
I found it interesting that they stated, as of this year, they are recognizing revenue on sales to distributors with 6 months terms when payment is received, not when product is shipped.

This should have been explained in a press release earlier. If it was, I missed it.

That explains why the numbers in the 1st qtr report seemed out of whack. KitCat had a field day finding "problems" with the company using the 1st qtr numbers.

Anyway, they confirmed they were still on track to report 110 to 120 million in earnings for the full year. That's 2.20 to 2.40 a share, although I'm not sure if that was GAAP numbers or "adjusted numbers" Ths share price doesn't seem to reflect that the report was favorable. If the majority of todays trading is by retail investors, I wonder if the delay in revenue recognition accounting change was noticed by some.

Maybe one of you posters can clarify something. If they didn't recognize the sale at the time of shipment, are they still showing the shipped goods as their inventory until payment is received? With double entry book keeping, it would appear that they are ignoring the shipments or it has to be showing up as a credit and a debit somewhere on the statement.

In any case, it looke like a long haul before we see significant share price appreciation. Eventually the law of large numbers will result in a slowing of growth and they will be in a position for a share buyback, or preferably a nice dividend. They stated in the CC that it won't happen in the near future. That means they are still expecting significant sales growth over the next couple of years. We could see eps of over 3.00 by then. Barring any unfavorable news before then, I would think earnings would have to drive the price to close to double todays price.

Anyone have any thoughts on todays report and CC?
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (1) | Ignore Thread Prev Thread | Prev | Next | Next Thread

Announcements

Post of the Day:
Macro Economics

2.1: The Labor Pool Problem
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement