Friday, April 28, 2017

SEEKING ALPHA Writer Doesn't See Anything Criminal at Titan Machinery

This week on Seeking Alpha a writer said he did not see anything criminal at Titan Machinery.

The Contributor mentioned my name and referenced some of my notes as well.

"I'm not sure if any of these activities are criminal, I'm just not as confident as the contributor that these  activities are not criminal" - Tom Renna

Thanks for the mention.
You mention that you didn't you see anything that the company has done that is criminal so you don't see the company blowing up.
I think it would take a criminal investigator to make that decision.
For instance , has any agency ever investigated the suspicious trading in the stock prior to the 8K filing when the auditor suddenly resigned?
Have you or any agency ever investigated the suspicious trading in the stock on the session prior to the company issuing a press release that the company announced they were abruptly closing stores?
Has any agency ever investigated the lack of "related party transactions" disclosure regarding the construction company that has done the work building out locations.
In the quarter that the company inflated their assets and under reported losses by 50%, has any agency ever investigated that disclosure?
Has any agency investigated the HYPE EPS estimates made by the Penny Stock Firm located in Minnesota (FELTL) saying the company would earn $0.37, only to see the company report a loss of over a ($1.00) 6 months later?
Has any agency investigated who is running Dealer Sites? You mention Dealer Sites had those lease agreements with Titan prior to going public but the percentage ownership of 30% is incorrect. It was nearly 100%. Are you aware that in 2013 they increased the lease agreement from $50 million to over $100 million?
Does anyone know how many of the stores that still remain are on properties owned by Dealer Sites? Have any of the stores that closed on property owned by Dealer Sites?
Was there anything wrong When the Chairman hyped up his stock when he was featured on CNBC Mad Money with Jim Cramer and then 30 days later he and the CEO sold 500,000 shares @ $28 (note there are only 21 million shares out).
More notes on Selling into Hype here ..
I am not sure if any of these activities are criminal, I'm just not as confident as you that they are not.
I can dig up more notes later to post here.
As far as risk reward in owning shares here at the $15 level, what are your thoughts?
The company this month said they were closing 15 USA stores by July 31st (almost 20% of USA locations) and gave guidance that sales will decline in FY2018 and they company would not be profitable again for the 4th consecutive year.
If they were to earn $0.05 a share in FY2019 , do you think the company deserves a Price Earnings Multiple of 300 based on FY2019 earnings estimates?
You mention that the company has available Credit of $500 Million, but that is not really true because the covenants of their Loan agreements won't permit them to exceed their current ratios.
Although you correctly note that the company "had" $52 million on Jan 31,2017, that number has declined after they paid out $15 million to WFC since that date.
There's so so much more for me to comment about this company but I have to go somewhere this morning.

Contributing to their cash flow was a gain in FY2017 from an insurance claim due to store burning to the ground.

This game has been going on for years. If you really want to see the early disclosure.

Monday, April 17, 2017

Five Titan Machinery Directors Gone in Two Years

Of Titan Machinery's 9 directors that sat on the company's board in May 2015, only 4 remain.

APRIL 2013 DEF14 : Most OverPriced Stock Titan Machinery Files Proxy Statement

The 9 Board of  Directors in April 2015 
 The 8 Directors as of April 2016

The 8 Directors as of April 2017

Wednesday, April 5, 2017

SEC Comments Will Effect Titan Machinery's Upcoming 10K

Before you step into the 2017 SEC Comment Letters and if you are  new to TITAN MACHINERY (NASDAQ: TITN) colorful stock trading, you can click here to see the history of BIZARRE hype. 
Including, but not limited to: 


On January 26,2017 the Securities and Commission's Division of Corporate Finance sent the following Comment Letter to Titan Machinery after a review of the Company's FY2016 Annual 10K filed back in April 2016.
The Comment Letter requested clearer and more transparent disclosure regarding Titan's Adjusted EBITDA, Inventory and Wells Fargo Credit Agreement.
On February 9, 2017 Titan filed a Correspondent in response to the SEC comment letter and agreed to make changes regarding each disclosure.
Ironically, also on February 9,2017 Titan filed an 8-K with the SEC announcing that they would be closing 15 locations and gave gave guidance to the street regarding their FY2017 Sales and Earnings which were originally expected to be announced on March 30,2017.
What's is so strange is that FY2017 ended on January 31,2017 and the company's guidance regarding  the FY2017 top line sales number were lower than the Actual Number that was reported on March 30,2017 causing the company to BEAT THE TOP LINE on the morning of the Year end press release.
What's even more bizarre is that the company expected to lose ($0.20) but instead loss ($0.31). The Top Line Beat was celebrated by Wall Street sending the shares up from under $13 on Monday to close the week above $15 at a $330 million market capitalization.

Chart is an image from 

In April 2014 Titan Machinery shares traded @ $15.50 and the company reported FY2015 sales of $2.2 Billion and the company was profitable.
Over the last 3 years since April 2014 the company has reported losses for a combined ($84 Million) and recently announced FY2017 Sales of less than $800 million in equipment for the entire year.
Meanwhile the Stock closed yesterday @ $15.50 and remains at a $300+ million market capitalization.

So What drove the stock higher? Was it FY2018 Guidance? 
CEO David Meyer on the conference call last week WARNED THAT Agriculture and Construction EQUIPMENT SALES WILL FALL FURTHER IN FY2018!!!


After doing some Digging to find out what was catalyst to drive this thinly traded Titan Machinery micro cap stock with a mere 21 million shares outstanding skyward. 
I am not a subscriber to Real Money services but I did find someone who profited from buying the TITAN SPIKE and congratulated Real Money author REVSHARK on twitter.

Check out this chart from for TITN

Visit to see more great charts.