Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev Thread | Prev | Next | Next Thread
Author: Har1en Big red star, 1000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 34  
Subject: New CEO, comments on earnings Date: 6/18/2007 4:23 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 1
I just saw this because I was checking up on ZIPR's news over the last few months -- I thought at first I was misreading something.

http://tinyurl.com/23x8p4

As of June 6th, ZIPR canned Richard Sommer and promoted the old president to CEO. The new fellow's name is Patrick Lashinsky. Sommer's been kept on as a board director, so he'll be around if Lashinsky wants to ask him to return the keys to the executive toilet.

Also, quarterly numbers came out in May that I had not seen yet. Bad, but not horrible. About as expected in this environment, I would say.

http://tinyurl.com/2ve9rn

I noticed that they had a 26% increase in the number of agents they keep. I worry about this -- what's to prevent these agents from taking salary now and then jumping ship when the next big rise in home prices hits?

The 26% increase in agents yielded a rise in closed transactions of only 15%. This makes some sense, as the new folks take a while to get ramped up.

They still have 85MM in cash, and no debt yet, so they're ready for more expansion during this down time. That is exciting.

They have guided for a 13MM loss this year. This is disquieting, although they have the cash to cover it.

I can understand being bargain realtors, but I worry that they are giving away too much money. For them to make money, they will need to increase the average transactions or the average deal value for their agents.

At this point, adding more agents merely increases their losses, as they pay out more in operating expenses and salaries than they make.

This cannot continue indefinitely, and if the market drops further, they really don't have much cushion. I estimate that they have 4 to 6 years to go before they burn through all of their cash. Will the market turn around at this 5 year mark? I figure it will, actually. But it would make me feel better if they were making some income, or just breaking even during this time of expansion and market weakness.

Har1en

Long -- and awaiting another buying opportunity.

Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev Thread | Prev | Next | Next Thread

Announcements

Post of the Day:
Value Hounds

Medallion Financial: TAXI!
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