Thursday, December 22, 2016

Friday, November 4, 2016

Short Pick Noodles Misses


Last night after the close Noodles (NASDAQ: NDLS) reported a weak 3rd Quarter sending the stock down at the open this morning 5%.

Equities Research Summer Newsletter Short Picks are all down significantly over the 4 months since the picks were made, while the Standard and Poors 500 Index remains flat.

Under Armour Reported 3rd Quarter Financials last week sending stock down $7 for the week.

Next up will be Titan Machinery reporting 3rd Quarter financials either the last week of November or early December. Unlike Noodles and Under Armour, which are just over valued stocks with weakening fundamentals,  Titan Machinery may find themselves out of business soon unless they are able to raise capital. 

Warning on Titan Machinery 


Thursday, November 3, 2016

  • Company enjoys higher gross profit margins because they record shipping and handling fees as net revenue but expense the cost as selling and general administrative expenses vs cost of revenue. The $25.7 million in Q3 charged in SG&A helped gross profit increase from 50.7% to 52.5%.
  • Company Recorded more than $65 Million of Net Revenue from shipping and handling fees for the first 9 months of 2016 up from $40 million attributed to net sales in first nine months of 2015.

Under Armour Stock Down 36%

Check out this chart from StockCharts.com for UA

          Visit StockCharts.com to see more great charts.

Under Armour (NYSE: UA $30.79) closed yesterday down 36% since closing @ $48.20 (adjusted for split) on November 2,2015. Over the Same 1 year period the S&P500 Index which closed yesterday @ 2097 is down a mere 7 points from November 2,2015 close @ 2097 (is flat.) 

The company filed their 3rd quarter 10Q with the Securities and Exchange Commission yesterday.

Highlights from 10Q 


  • DEBT INCREASES to Over $1 Billion



  • Related Party Transactions : CEO Kevin Plank entity Sagamore Development Holdings sold property for $70.3 million to Under Armour. According this news story the sale price was more than twice what Plank paid for the property in 2014.


  • Allowance for Doubtful Accounts As of 9/30/16 $33.6 million, 12/31/15 $5.9 million 9/30/15 $6.3 million.

  • Under Armour trailing 9 qtrs (aggregate) Negative -($280 Million) operational cashflow. $1 Billion/debt


  •  Company Improved EPS growth due to lower Q3 2016 (32.6%) tax rate vs Q3 2015 (38.8%)
  • Company enjoys higher gross profit margins because they record shipping and handling fees as net revenue but expense the cost as selling and general administrative expenses vs cost of revenue. The $25.7 million in Q3 charged in SG&A helped gross profit increase from 45.7% to 47.5%.
  • Company Recorded more than $65 Million of Net Revenue from shipping and handling fees for the first 9 months of 2016 up from $40 million attributed to net sales in first nine months of 2015


Equities Research Warning on Monday October 24th, the day prior to the 3rd Quarter Earning press release.

Below is the performance of the October Put Options from Monday the 24th to Friday October 28th.

Put Prices on Friday October 28
Put Prices on Monday October 24,2016 (below)

Tuesday, October 25, 2016

Archives Of Top Red Flags (-99%) Equities Research Monthly Newsletter ABOUT What Pros say about EquitiesResearch Search by ticker/date SEARCH SITE Chipotle Warning $430 to $230 Herb Greenberg (video below) mentioning my work on CNBC TV on the morning Chipotle Mexican Grill filed their10Q. (April 20,2012) I raised Red Flag when stock was near its all time high. Over next 90 days shares fell from $420 to below $300. By October 2012 shares hit $234.00. Put Options skyrocketed from $0.10 to over $5.00. Examining Cash Flow Bob Olstein Jim Chanos Jim Cramer Warren Buffett Herb Greenberg Videos : A, B,C,D,E Tom Renna ( Under Armour EPS SYNDROME Days) UNDER ARMOUR WARNING $68 to $8 A, B,C ,D ,E,F,G ,H , I Upgrades/Downgrades Archives Tuesday Market Commentary 29 Equities Research Stock Portfolios BRK http://www.berkshirehathaway.com/2000ar/2000ar.pdf Warren Buffett, Chairman of Berkshire Hathaway: click to <2000 Annual Report: "Common yardsticks such as dividend yield, the ratio of price to earnings or to book value, and even growth rates have nothing to do with valuation except to the extent they provide clues to the amount and timing of cash flows into and from the business. Indeed, growth can destroy value if it requires cash inputs in the early years of a project or enterprise that exceed the discounted value of the cash that those assets will generate in later years. Market commentators and investment managers who glibly refer to growth and value styles as contrasting approaches to investment are displaying their ignorance, not their sophistication. Growth is simply a component--usually a plus, sometimes a minus-- in the value equation." PRIVACY POLICY This privacy policy applies to the use of www.equitiesresearch.com. We highly value your privacy and make this policy easily available throughout our site to assist you in understanding the handling of information in the course of using this site. Log Files and Cookies This website utilizes industry standard analytics packages which gathers limited information on visitors to our website automatically, and stores this anonymous information in server log files. This information may include IP addresses, browser type, basic IP information, referring pages, operating system used and date/time stamps. 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9/13/2012 29 Stockdiagnostcs Upgrades Acquired in 9 months company ticker Acquirer LOI date $ Upgrade $ Close Time % Return vs.S&P500 Mediware information MEDW Thom Bravo 9/12/2012 $8.18 $21.86 5y 4m 167% -4.60% KSW, Inc. KSW Related Cos. 9/11/2012 $2.78 $4.97 2 years 79% 33.56% Kenexa Corp. KNXA IBM Corp 8/27/2012 $22.19 $46.00 1 year 109% 19.27% Dollar Thrifty Auto Grp DTG HERTZ 8/28/2012 $54.06 $87.08 17 months 61% 7.19% Micronetics Inc. NOIZ Mercury 6/11/2012 $7.02 $14.80 8 months 111% 19.27% U.S. Home Systems USHS Home Depot 8/7/2012 $4.91 $12.50 1year 155% 27.59% Authen Tec, Inc. AUTH APPLE Comp 7/28/2012 $3.02 $8.42 8 months 179% 3.43% Rail America RA Genesee Wy 7/23/2012 $10.37 $27.25 22 months 163% 29.79% Amerigroup Corp. AGP WellPoint 7/9/2012 $38.96 $92.00 23 months 136% 19.92% Amylin Pharmaceutica AMLN Bristol-Myer 6/29/2012 $12.51 $31.00 13 months 145% 1.50% Integramed America INMD SCP, L.P. 6/11/2012 $10.30 $13.68 15 months 32% 0.81% Edgar Online, Inc. EDGR R.R.Donnell 5/23/2011 $0.76 $1.08 9 months 42% 10.47% Aribe Inc. ARBA SAP 5/22/2011 $7.34 $45.00 6 years 513% -6.81% Golfsmith It'l Hold,Inc GOLF Golf Town 5/14/2012 $4.15 $6.10 14 months 47% 2.15% GTSI Corporation GTSI UniCom 5/14/2012 $5.00 $7.71 1 year 54% 1.68% Cost Plus, Inc. CPWM BBBY 5/10/2012 $4.58 $22.00 2 years 380% 28.64% Easy Link Service Int ESIC Open Text 5/3/2012 $1.80 $7.16 29 months 302% 26.97% Charming Shoppes CHRS Ascena R 5/2/2012 $4.18 $7.35 13 months 75% 5.57% Ardea Biosciences Inc RDEA AstraZen 4/24/2012 $3.35 $32.00 6 years 855% 6.02% Knology Inc. KNOL WOW, Int 4/18/2012 $9.91 $19.75 6 years 99% 6.76% X-Rite, Incorporated XRIT Danaher 4/11/2012 $1.97 $5.54 3 years 181% 51.49% Transcend Services TRCR Nuance 3/8/2012 $14.64 $29.18 5 years 100% -9.28% CH Energy Group,Inc CHG Fortis 3/6/2012 $50.67 $66.60 9 months 31% 4.22% Sera Care Life Science SRLS Linden CP 3/6/2012 $0.90 $3.97 3 years 342% 51.98% Taleo Corporation TLEO Oracle 2/10/2012 $8.00 $45.00 3 years 469% 54.28% Pep Boys-Many,Moe,J PBY Gores 1/31/2012 $9.58 $15.00 5 months 56% 12.92% Novellus Systems Inc NVLS Lam Resear 12/15/2011 $26.00 $44.00 16 months 70% 55.95% Demand Tec, Inc. DMAN IBM Corp 12/9/2012 $5.45 $13.20 5 months 70% 8.45% Success Factors, Inc. SFSF SAP of GMY 12/4/2011 $7.75 $40.00 3 years 416% -4.10%





   Tom Renna @stockpicker908 thomasrenna@gmail.com 
    www.EquitiesResearch.com 

UNDER ARMOUR WARNING JANUARY 2016
UNDER ARMOUR WARNING MARCH 2016

From time to time I'm asked about analysts, diggers whose work I really respect, 
who do things well. Tom Renna, @GFNNstock, is a must follow
— Roddy Boyd (@BoydRoddy) September 7, 2013

Congrats to a pair of determined stock sleuths: @adakcapital & their call on $CCRN 
and @StockPicker908 for his long-running work on $TITN

— Roddy Boyd (@BoydRoddy) March 10, 2015



Monday, October 24, 2016

Short Pick: Under Armour Hype Will Take Back Seat To Weak Fundamentals This Week

Under Armour (NYSE: UA) will report 3rd quarter financials on Tuesday and Wall Street continues to be Bullish.

Equities Research continues to Warn Investors to stay away from this high flyer and focus on the weak fundamentals and not the Hype! At end of day the rising debt, high interest expenses and declining operational cash flow will be reflected into a lower stock price.


Trade Card from Capital Market Laboratory

 

Performance of Recent Short Picks from EQUITIES RESEARCH

Friday, August 12, 2016

Summer 2016 Newsletter

Complimentary     
Summer 2016 Newsletter 
(issued on July 1,2016 to paid subscribers)

Long Picks :
Symbid (SBID) $0.17  (Equity Crowdfunding)
MeetMe,Inc (MEET) $5.33
Sabre Corporation (SABR) $26.79

Short Picks 
Under Armour (UA) $40.13
Titan Machinery (TITN) $ $11.15
NOODLES (NDLS) $9.78
 
top long pick SYMBID




   Fundamental Charts








 
 
     




Symbid (SBID)  is a highly speculative penny stock trading at a market capitalization of approximately $5 million. It is the ONLY publicly traded equity crowdfunding that I know of in the world.    



Disclaimer.
All Newsletters, published by Equities Research, LLC , does not constitute a recommendation by Equities Research, LLC to buy, sell, hold any security, or to follow any particular trading or investment strategy. Also, the information provided should not be construed as an offer, or a solicitation of an offer, to buy or sell securities. An investor's best course of action must be based upon individual circumstances. EquitiesResearch.com shall not be liable for any damages or costs of any type arising out of or in any way connected with your use of The Newsletters, or any of our services. 

EquitiesResearch.com, its officers and employees may buy and sell any position in the securities or companies mentioned 
Content copyright 2010-2016. Equities Research LLC. All rights reserved

Friday, July 1, 2016

Newsletter Pick Up 31%

Equities Research Newsletter pick Hershey UP 31% vs 1.7% gain for the S&P500.

Equities Research July 1, 2015 Newsletter featured a STRONG BUY  on HERSHEY @ $86.53 (dividend adjusted). 

Hershey closed yesterday @ $113.49, for a gain of $27 in exactly 1 year.
The Standard and Poors 500 index over the same 12 month period rose from 2063.11 to 2098.86 for a gain of 36 points.


Today, Readers should subscribe to Equities Research July 2016 Newsletter available NOW.

I've given plenty of great research in 27 years. My July 2016 pick is best risk/reward that I've ever found.
Order here and forward this to your friends.
SUBSCRIBE FOR JULY

Regards, 
TOMMY
HAPPY 4TH OF JULY EVERYONE


about founder Tom Renna
Contact Tom Renna (908) 477-4796 or thomasrenna@gmail.com


 
Equities Research Monthly Newsletter 
 (3 Picks,Tickers Only) $250/month
($2500 for monthly newsletters w annual subscription prepaid)


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Disclaimer. All Newsletters, published by Equities Research, LLC , does not constitute a recommendation by Equities Research, LLC to buy, sell, hold any security, or to follow any particular trading or investment strategy. Also, the information provided should not be construed as an offer, or a solicitation of an offer, to buy or sell securities. An investor's best course of action must be based upon individual circumstances. EquitiesResearch.com shall not be liable for any damages or costs of any type arising out of or in any way connected with your use of The Newsletters, or any of our services. All readers and subscribers and customers should consult a licensed financial advisor. EquitiesResearch.com, its officers and employees may buy and sell any position in the securities or companies mentioned. Content copyright 2010-2016. Equities Research LLC. All rights reserved

Thursday, June 30, 2016

End of Quarter: Time to Paint the Tape

June 30th is End of Quarter. Mutual Funds and Money Managers are Notorious for MARKING up Stocks, aka Painting the Tape, to increase the asset value of their Equity Positions into the Month end. It is based on tonight's closing prices that many money managers get their fees (percentage of money under management). So, this afternoon is a great time to Sell into the Inflated Prices and to even Short stocks, especially with the 3 day holiday weekend approaching.

#EquitiesResearch: ORDER Equities Research Newsletter & Research

Wednesday, March 30, 2016

Berkshire Hathaway 2016 Shareholder Letter

FEBRUARY 27,2016 

So Sad to read this, but it's reality

"There is, however, one clear, present and enduring danger to Berkshire against which Charlie and I are powerless. That threat to Berkshire is also the major threat our citizenry faces: a “successful” (as defined by the aggressor) cyber, biological, nuclear or chemical attack on the United States. That is a risk Berkshire shares with all of American business.
The probability of such mass destruction in any given year is likely very small. It’s been more than 70 years since I delivered a Washington Post newspaper headlining the fact that the United States had dropped the first atomic bomb. Subsequently, we’ve had a few close calls but avoided catastrophic destruction. We can thank our government – and luck! – for this result.
Nevertheless, what’s a small probability in a short period approaches certainty in the longer run. (If there is only one chance in thirty of an event occurring in a given year, the likelihood of it occurring at least once in a century is 96.6%.) The added bad news is that there will forever be people and organizations and perhaps even nations that would like to inflict maximum damage on our country. Their means of doing so have increased exponentially during my lifetime. “Innovation” has its dark side.
There is no way for American corporations or their investors to shed this risk. If an event occurs in the U.S. that leads to mass devastation, the value of all equity investments will almost certainly be decimated.
No one knows what “the day after” will look like. I think, however, that Einstein’s 1949 appraisal remains apt: “I know not with what weapons World War III will be fought, but World War IV will be fought with sticks and stones.” 

Berkshire Hathaway Profited On ENRON BONDS

FEBRUARY 28,2007 Berkshire Hathaway Shareholder Letter


"We continue, however, to need “elephants” in order for us to use Berkshire’s flood of incoming
cash. Charlie and I must therefore ignore the pursuit of mice and focus our acquisition efforts on much bigger game.
Our exemplar is the older man who crashed his grocery cart into that of a much younger fellow while both were shopping. The elderly man explained apologetically that he had lost track of his wife and was preoccupied searching for her. His new acquaintance said that by coincidence his wife had also wandered off and suggested that it might be more efficient if they jointly looked for the two women. Agreeing, the older man asked his new companion what his wife looked like. “She’s a gorgeous blonde,” the fellow answered, “with a body that would cause a bishop to go through a stained glass window, and she’s wearing tight white shorts. How about yours?” The senior citizen wasted no words: “Forget her, we’ll look for yours.” 


"in 2002-2003 we spent about $82 million buying – of all things – Enron bonds, some of which were denominated in Euros. Already we’ve received distributions of $179 million from these bonds, and our remaining stake is worth $173 million. That means our overall gain is $270 million, part of which came from the appreciation of the Euro that took place after our bond purchase. "


"Already the prediction I made last year about one fall-out from our spending binge has come true: The “investment income” account of our country – positive in every previous year since 1915 – turned negative in 2006. Foreigners now earn more on their U.S. investments than we do on our investments abroad. In effect, we’ve used up our bank account and turned to our credit card. And, like everyone who gets in hock, the U.S. will now experience “reverse compounding” as we pay ever-increasing amounts of interest on interest. "


"I want to emphasize that even though our course is unwise, Americans will live better ten or twenty years from now than they do today. Per-capita wealth will increase. But our citizens will also be forced every year to ship a significant portion of their current production abroad merely to service the cost of our huge debtor position. It won’t be pleasant to work part of each day to pay for the over-consumption of your ancestors. I believe that at some point in the future U.S. workers and voters will find this annual “tribute” so onerous that there will be a severe political backlash. How that will play out in markets is impossible to predict – but to expect a “soft landing” seems like wishful thinking."
  

"Over time, markets will do extraordinary, even bizarre, things. A single, big mistake could wipe out a long string of successes. We therefore need someone genetically programmed to recognize and avoid serious risks, including those never before encountered. Certain perils that lurk in investment strategies cannot be spotted by use of the models commonly employed today by financial institutions." 

FEBRUARY 28,2007 Berkshire Hathaway Shareholder Letter

Warren E. Buffett Chairman of the Board 
Berkshire Hathaway Shareholder letter 

Thursday, March 17, 2016

After Close: Titan Machinery Unexpectedly Pre Announces FY2016 Warning

  •  Expects FY2016 Sales Decline of $500 Million (-28%)
  • Expects Net Income  FY2016 Loss of ($37 Million) down from Fy2015 Loss of ($31 Million) 

Titan Machinery (NASDAQ: $12.50) is trading down significantly after hours after the company pre announced FY2016 Q4 and Year End Financials for the period ending January 31,2016. 
8K here
 

In March 2015 Titan Machinery Pre Announced FY2015 Financials and the stock was HALTED!

March 2015 FY2015 Pre Announcement:
GAAP net loss attributable to common stockholders for fiscal 2015 is expected to be in the range of $30.9 million to $32.0 million, or $1.48 to $1.53 per diluted share.  vs 
Adjusted net income attributable to common stockholders forfiscal 2014 was $16.5 million, or $0.78 per diluted share"


March 17,2016 FY2016

  • For the fourth quarter of fiscal 2016, revenue is expected to be approximately $335 million compared to revenue of $490.7 million in the fourth quarter last year.
  • Q4 the Company recorded an inventory impairment charge of approximately $27 million, or $0.77 per diluted share, related to the expanded equipment inventory reduction plan

  • Pre-tax loss for the fourth quarter of fiscal 2016 is expected to be approximately $53 million, compared to loss of $37.2 million in the fourth quarter last year.
  •  Pre-tax loss for the fourth quarter of fiscal 2016 included the $27 million impact from the equipment inventory impairment charges as well as a $6.7 million impairment charge related to long-lived assets. 
  • Pre-tax loss for the fourth quarter of fiscal 2015 included non-cash impairment charges of $31.0 million primarily related to goodwill and other intangible assets within the Agriculture segment. 
Total Company: Loss of $45 million, which includes equipment inventory impairment charges of approximately $27 million, compared to loss of $5.0 million for the fourth quarter last year. 

Net loss attributable to common stockholders for the fourth quarter of fiscal 2016 is expected to be approximately $34 million, or $1.62 per diluted share, compared to net loss of $27.0 million or $1.28 per diluted share for the fourth quarter last year. Excluding all non-GAAP adjustments, adjusted net loss attributable to common stockholders for the fourth quarter of fiscal 2016 is expected to be approximately $28 million, or $1.31 per diluted share, compared to adjusted net loss of $4.1 million or $0.20 per diluted share for the fourth quarter last year.


Preliminary Fiscal 2016 Full Year Results



For the full year ended January 31, 2016, revenue is expected to be approximately $1.37 billion compared to $1.90 billion last year. GAAP net loss attributable to common stockholders for fiscal 2016 is expected to be approximately $37 million, or $1.76 per diluted share, compared to net loss of $31.6 million or $1.51 per diluted share last year. Adjusted net loss attributable to common stockholders for fiscal 2016 is expected to be approximately $26.5 million, or $1.25 to per diluted share, compared to adjusted net loss of $1.9 million, or $0.09 per diluted share, last year.



No Mention of the Cash raised from the sale of this Titan property to Sterling Real Estate Trust on January 29,2016. (2 days prior to the ending)
Executive Manager of Sterling is former assistant to Titan's president



Equities Research Warned @ $30 

Sunday, December 13, 2015

Sunday, March 13, 2016

Under Armour Spin Leads League Schooling Wall Street's Finest

 UNDER ARMOUR SPIN CLASSES 
When: Monday to Friday
Time: 9:30 to 4pm
Where: WALL STREET
Its A Technology Company
SUPER BOWL
3-D Printing
 CHINA Hyper Growth Story
IBM WATSON 
Exaggerated Earnings Beat
FITBIT Comps
*Note classes on each day may vary depending on the Wall Street flavor of the day.
** filings on Friday Night after the close are intentional and are not recommended reading. 
***ALL Morgan Stanley Research regarding A Downside Risk of $42 (-50%) should be ignored.


Equities Research Warning: SELL Under Armour
Equities Research is speculating that Under Armour (NYSE: UA) will announce in the next 4 weeks an equity or debt underwriting before the company announces results for the first quarter in late April 2016. Under Armour 1st quarter ends March 31,2016.
Equities Research believes Under Armour will raise capital before the Q1 report because of expections the company will miss Wall Street analyst Q1 EPS estimates of $0.05 per share. Equities Research believes Under Armour Will Report a LOSS for FY2016 Q1.  

Under Armour Needs cash and can not afford to take a risk of a poor Q1 earnings report's effect on its stock, a significantly weaker market capitalization would make any underwriting done after a poor report to adversely effect pricing.  Under Armour disclosed on their FY2015 Conference call that they would "look for Opportunities to refinance their debt".  The company's total debt increased to $669 million for the period ending December 31,2015 up from $284 million for the period ending December 31,2014.  The company also noted that FY 2016 interest on debt would increase to $35 million (approximately $0.16 per share). 

To keep the stock higher, Under Armour has put on a "FULL COURT PRESS" , literally. A day doesn't go by without a major news wire reporting Spin after Spin, from Barron's to TheStreet to every message board on the planet, the company has touted their scouting expertise at finding high school athletes in AAU  to Silicon Valley technology ventures with IBM's Watson.

The only Scoreboard that matters to Equities Research is not in the headlines, but in the BOX SCORE, also known as audited financial statements filed with the Securities & Exchange Commission.
  • December 31,2015 Cash & Cash equivalents were $129 Million down from $593 Million from December 31,2014.   (78% Decline)
  • FY2015 Cash Flow from Operations was Negative $44 Million down vs Positive $219 Million in FY2014. A Decline of $263 Million year over year. 
  • $48 million of the $129 total cash is held in foreign subsidiaries, while only $81million is available in the US. Foreign Subsidiary held cash is not expected to be used in US due to tax consequences.



Friday Night Dump
Under Armour (NYSE: 82.45) filed a DEF 14 filing with the Securities & Exchange Commission late Friday after the close, also known as a #FridayNightDump.

  • (SPIN) Kevin Plank CEO Compensation Drops 31.5% 
At first glance it looks like CEO "took less" compensation in the best interest of the Shareholders, but  after digging into the DEF14A we learn otherwise.  It turns out that in addition to the CEO, Maurath the Chief Revenue Officer also earned less compensation  This was not a shareholder friendly decision, but instead as disclosed in the filing, these two officers compensations declined by an aggregate of $1.8 million as a direct result of financial performance (or lack their of).
A small $1.8 million compensation number may sound insignificant, but as I will get to later I will show how this "little" number made a $4 Billion Increase to the Company's market capitalization within a 48 hour period. What really is even more alarming is that this disclosure is only being surfaced 6 weeks after an opaque FY2015 earnings report was hyped.


Down 17% in 3 Weeks
On Wednesday January 27th Under Armour traded at a low of $66.93 and was down $14 Year to date from its $80.61 December 31,2015 close. (-17% in 4 weeks).
Under Armour traded on October 12,2015 at an all time high above $104.74 and the following day the CFO resigned and the shares would eventual fall to a 52 week low of $66.93. (Down $38 in 3 months, a  -37% drop in 90 days)



Up 28% in 2 Days
On Thursday January 28th pre market, Under Armour announced FY2015 earnings and by the close on Friday the shares had Sky rocketed to close the week @ $85.43, UP $19 in two days or 28%.

Friday night March 11th we learned a "little more" about how Under Armour "BLEW AWAY THE WALL STREET ANALYST ESTIMATES" back January 28th.  A $0.02 Beat for a company with 220 million shares outstanding would be a beat of $4.4million. But the company beat the net income estimate by only $3.2 million based on the release. Now after finding out Friday night , 6 weeks later, that the CEO and CRO earned less than an aggregate of $1.8 million vs. FY2014 due to not meeting financial performance targets. We now need to subtract the $1.8 million from the $3.2 million beat and we end up with a beat of only $1.4 million, which is an ACTUAL BEAT of $0.006 (less than a penny and NOT $0.02 that WALL STREET FINEST USED TO PUMP MARKET CAP UP BY $4 BILLION within 2 days!

Using the Actual Math, and not the Spin Number, Under Armour DID NOT Grow Earnings by 20% in FY2015 Q4 vs. FY2014 Q4. Earnings only grew by 18%.

Stephen Curry was mentioned 27 times on the morning Conference Call and the word "CASH" was mentioned once.  

Positive EFFECT OF TAX LOSS Carry Forwards on NET INCOME (NOL)


February 22,2016 the company discloses in SEC 10K filing that Accounting Errors have been discovered in the cash flow statements for FY2015 Q1 and Q2.



Down 18% in 6 Days
Sunday, January 31st Equities Research downgrades Under Armour to a Sell, shares fell $15 over next 6 trading sessions from $85.43 to a low of $70.33, down 18%. (humble note: BOJ announcing NIRP on the 29th brought the entire Global Market to its knees, until (SPIN) Jamie Dimon and Warren Buffet   touted how the USA  market was a great buying opportunity and all is well).

Up 17% in 4 Weeks

Friday, March 11th Under Armour closed @ $82.45 up $1.45 on the day.

  • (SPIN) Under Armour, (the Technology) Company Makes Huge Splash at Consumer Electronics Show.
  • (SPIN) CEO Kevin Plank "spoke with" CEO of IBM about IBM's "HEALTH HUB"
  • (SPIN) IBM WATSON can let you know how you're feeling today on Scale of 1-10).
 •(SPIN) "Lewis: Yeah, I think when you hear IBM Watson you have that, whoa, this is some serious data analytics and serious AI-type work that they're going to be doing."
 •(SPIN) Under Armour deems it necessary to file 8K on March 4th to inform the public that The Sports Authority bankruptcy will not effect Under Armour.
On Wednesday March 2nd, a week after Under Armour filed their 10K , The Sports Authority filed bankruptcy and announced the closing of 140 of its 463 stores. Analysts estimate that The Sports Authority generated revenue of $3 billion in 2015. The bankruptcy filing lists Under Armour as one the largest creditors with $23 million in receivables. 
Under Armour immediately came out with an (8K) announcement DEFENDING its FY2016 guidance and stated The Sports Authority will not have an effect on FY2016 projections. 

Although Under Armour filed an 8K saying otherwise, Dick's CEO says company will see increase selling pressure in months to come due to liquidations at The Sorts Authority.


Thanks to the genuis of Ophir Gottlieb the founder of Capital Market Laboratories, I am able to share his TRADECARD graphs from his CMLVIZ website.


NEGATIVE $44 MILLION Cash Flow from Operations ttm
vs
NET INCOME $232 Million ttm
$670 MILLION TOTAL DEBT

NEGATIVE $256 MILLION LEVERAGED FREE CASH FLOW 



WHY CASH FLOW MATTERS

OLSTEIN: Earnings vs. Cash Flow



New York Times  7/18/1999 


"EARNINGS VS. CASH FLOW -- Mr. Olstein first examines what a company generates in cash flow from its operations. A company with excess cash flow can raise dividends and survive tough times without being forced to borrow or sell assets.
To calculate a company's cash flow, start with net income. Add back what it has taken in depreciation expenses and accounts payable. Then subtract capital expenditures, inventories and accounts receivable.
Watch out, Mr. Olstein said, if net income is much higher than cash flow. The company may be speeding or slowing its booking of income or costs, perhaps to meet analysts' earnings forecasts."




 Fortune Magazine  6/26/2000


  Eight Warnings You Want to See by Herb Greenberg

"Positive free cash flow. Olstein looks at a company's financials, specifically the 10-Qs and 10-K, and makes a beeline for the statement of cash flows. We're not talking about the stated cash flow from operations, investing activities or financings. We're talking about cash flow from operations minus capital expenditures--the amount of usable cash the company actually generates, which can be used to buy back stock, pay dividends, make acquisitions, and grow the business." 



 TheStreet.com 6/25/01

Fund Junkie by Ian MacDonald
" Our main defense against risk is only buying companies that either are currently generating excess cash flow, or will in the next three years."

Financial Advisor Magazine August 2001
Staying Alert Pays Off by Maria Brill
"To Olstein, being right means finding companies with excess cash flow that are selling at inexpensive levels because investors are tuning them out. "Cash flow is the oil that lubricates the corporate engine," he observes."

 The Washington Post 2/17/2002
"By concentrating on cash, investors can learn enough about a company to eliminate it as a possible investment. FOr example, if you want to get a quick-and-dirty reading, look not at a firm's "income statement" but at a more obscure tables of numbers called its "statement of cash flows".

New York Times 11/14/2004 
Sometimes It Takes a Sherlock by Gretchen Morgenson
""Everyone looks at conventional price-earnings ratios but that doesn't tell you anything about the deviation between cash flow and reported earnings," Mr. Olstein said."

 Financial Advisor Magazine June 2006
Forensic Accounting by Jeff Schlegel
"Olstein believes that cash--particularly free cash flow--is king because he thinks it's a truer measure of a company's underlying performance. He and his staff analysts look for companies trading at a discount to free cash flow. Lack of free cash flow is one reason why he doesn't like (a sector) ..."

 CFA Institute 12/4/2007
Free Cash Flow & Quality of Earnings by Fred H. Speece, Jr. CFA

BloombergBusinessweek 8/17/2009 
Behind Bob Olstein's Comeback by Karyn McCormack
"....buy quality companies that have "wide moats" (in other words, "hard to compete with out of the box"), have been generating free cash flow throughout the financial crisis, and have a great balance sheet to withstand any issues."

 New York Times 1/9/2010
Fair Game:Why All Earnings Are Not Equal by  Gretchen Morgenson
As the market goes higher, it becomes more important to measure the quality of corporate earnings, he said. You have to look behind the numbers.
Adjustments that investors need to make now, in Mr. Olstein's view, are a result of disparities between a company's reported earnings and its excess cash flow. Earnings are what investors focus on, but because these figures include noncash items, based on management estimates, the bottom line may not tell the whole story.
Cash flow, on the other hand, is actual money that a company generates and that its managers can use to invest in the business or pay out to shareholders.

SOME of the widest gulfs between earnings and cash flows, Mr. Olstein said, are showing up the ways companies account for capital expenditures."

 New York Times 9/11/2010
Cash is king, he says. He spends a lot of time crunching numbers in a search for strong cash flow, and his winnowing process goes something like this:
First, he scrutinizes a company's financial reports in an effort to determine whether they paint an accurate picture. In this work, he has considerable expertise: he was an auditor with the old Arthur Andersen & Company, and then, in the 1970s, was co-author of The Quality of Earnings, a financial newsletter that, in its day, was perhaps the foremost authority on spotting the gray areas of corporate accounting.
If you're analyzing a company, he says, you first have to understand what they're really earning, as opposed to what they say they're earning.  

 American Association of Individual Investors  October 2010
"the forensic analysis we undertake
to analyze a company's results and the quality of its
earnings for valuation purposes.
1. Using the company's cash fl ow statements, we begin by
reconciling the difference between free cash fl ow and
reported earnings under accrual accounting. (Accrual
accounting records revenues, expenses and income
when the transaction occurs, as opposed to when
the cash is actually received or spent.) The smaller
the difference between free cash fl ow and reported
earnings, the higher the quality of earnings."

 Barron's 4/30/2011
Depreciation, An Appreciation by Lawrence C. Strauss
"He grows more concerned when a company's reported earnings significantly exceed its cash flow,..."

 Value Investor  4/30/2012
"Describe where you look first in researching
a company's financials.
RO: We begin by reconciling the difference
between free cash flow and reported
earnings under accrual accounting. The
smaller the difference, the higher the
quality of earnings. The bigger the difference,
the more work we have to do to
understand the makeup and sustainability
of free cash flow."