Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
Hi!

I'm really interested in this company. The fundamentals look good. Before I jump in, however, I'd like to know some more about it. Is there is anyone out there near Monterrey, California, that has first hand knowledge of the company. Has anyone of you, for instance, tried their wines? Are they good? Has anyone of you visited their tasting room? How about the vineyards?

I've read the company's annual report. I worry that their revenue is all made in the late fall, at harvest. A lot of things can go wrong between now and then. Also, they have to borrow a lot of money while they wait for the harvest. On the other hand, their PEG is around .35, which is extremely low.

I'd be grateful for any information you can provide.

Thanks!

Print the post Back To Top
No. of Recommendations: 0
yayo wrote:
<<Has anyone of you, for instance, tried their wines? Are they good? Has anyone of you visited their tasting room? How about the vineyards?>>

My impression was that most of their business was in selling grapes to other wineries, no? I'm very partial to Monterey Chardonnays myself--not so much of the woody flavor you find in most California Chards, but there's a hint of pineapple in there that makes it quite light and fruity. I'd be surprised if Scheid's grapes were much different from others in the area. Maybe I could ferret out which wineries buy those grapes and which wines they end up in, and we could have an online tasting session! :)

But I agree that the fundamentals look attractive--it'll be a bumpy ride, but a fun one. And, as a final note, the stock certificate is absolutely gorgeous. If you like this stock, definitely hold at least one share in your own name.

Dave Tepper
Print the post Back To Top
No. of Recommendations: 0
Dave,

Thanks for the reply. You're right, they mostly sell grapes to other wineries. But the annual report did mention that they make some ultra premium wines, and that they have a tasting room. It would be great to hear from someone who's had first hand experience with their product. I would really like to know who their major customers are, but I suspect that would be harder than checking out their tasting room. It would also be nice to have someone, who's seen the vineyards, report back. Earlier in the year the stock took a tumble on fears that the company would be affected by "El Niño". Management reacted with a statement indicating they were not adversely affected, and the stock has recovered most if not all of the lost ground. Still, it would be reassuring to have a third set of eyes on site.

One big concern I have is that last year they had a bumper crop. I don't know how likely they are to repeat that this year.

Thank you once again for your reply. I'm waiting for 1st quarter reports to decide whether to stay with my current investments, or switch some money over to SVIN.

Good luck to you

Yayo
Print the post Back To Top
No. of Recommendations: 0
Yayo said:

<<I would really like to know who their major customers are, but I suspect that would be harder than checking out their tasting room.>>

Not that hard. The annual report said that one of their major customers is Canandaigua Brands, a publicly-traded alcoholic drinks business. Paul Masson and, get this, Manischewitz, are two of their wine brands. Yep, that sickly sweet wine generations of Jews like me have been forced to suck down on Friday nights and Passovers is from Canandaigua. But I digress.

I just checked the Wine Spectator database, and found a listing for a 1993 Paul Masson Monterey Chardonnay. So I'm guessing that SVIN's grapes went into the making of that one. Also, there's a listing for Scheid's own 1995 Chardonnay, which scored higher than the Paul Masson (and looks delicious, by the way).

As for El Niño and bumper crops... well, that's just the risk you have to take with agricultural stocks, and this one in particular. I find it heartening that they have contracts for their grapes going through 2006, so unless California finally falls into the sea or mutant grape weevils attack, there's sort of a floor on their earnings. There's no way on earth I'd park a significant amount of my money into it--keep on investing in good old Dow companies like any Fool would. But the company seems solid and poised to make money over the next few years, so you could easily do a lot worse.

Could you objectively do better with another stock if you did more research? Almost certainly. But I don't like my investing to be all work and no play. Since and only because SVIN is by any measure a thriving company right now, I find the romanticism of owning a small bit of a vineyard to be worth the cost of any missed opportunities.

My $0.02,
Dave Tepper
Print the post Back To Top
No. of Recommendations: 0
Dave,

Hats off to you again. Thank you for sharing your knowledge of wines and the wine industry. It is reasuring to know that such a high volume producer as Canandaigua Brands is a customer of SVIN. Although calling these premium labels is a bit of a stretch, nevertheless it is good to know that SVIN has awell established volume customer. I do remember seeing in the 10K, that Sheid Vineyards has long term contracts, but in the 10K they did not mention any customer by name. Since I don't yet own SVIN, and I haven't contacted investor relations, I didn't have the annual report. So thank you again.

Going strictly by the numbers, at a price of 10 1/4, I calculate a PEG of .403, and a fair market value of $25.40. I'm using an earnings estimate of $1.38/share for the year ending Dec, 1999, and $.79/share for year ending 1997, giving a 32% growth rate, and a P/E of 12.97. Do these numbers correspond to yours?

May you enjoy Passover in the company of your loved ones

Gerardo Quiñones
Print the post Back To Top
No. of Recommendations: 0
Hello again.

I come up with a significantly worse growth rate
by using the $.98/share earnings for 1997 and
the predicted $1.38/share earnigs for 1999.
That gives a 18.7% growth rate and might suggest
a 1999 closing price of around 25.8 which still
sounds fairly good. But I find the
debt/cap for this stock
is 40% and the debt/equity is a whopping 1.32. You
can fold that in any way you want, but the net
result is that there are significantly more attractive
stocks out there ... even if they do have less
attractive stock certificates.

- Screamin
Print the post Back To Top