Tuesday, August 25, 2009

Answering Requests, Part III

NDL11 asks, pithily,


In response, I offer this recent correspondence between me and Aaron Edelheit, from Aaron's blog:

1. DaveinHackensack Says:
August 14th, 2009 at 1:09 am


I saw your comment on the company formerly known as PhotoChannel on the VIC. Do you have an updated target in mind for when the company will start consistently posting positive EPS (not just cash EPS)? Just curious.

2. admin Says:

August 14th, 2009 at 1:48 pm

$2.50 to $3 per share in the short run. If some of their growth prospects such as getting Wal-Mart, the stock would be much higher. They will post positive eps in the December quarter.

amortization blocks it because the company made two acquisitions.

3. DaveinHackensack Says:

August 14th, 2009 at 2:33 pm

Do you envision they will be profitable consistently from the December quarter forward?

4. admin Says:

August 14th, 2009 at 2:40 pm

The march quarter may be their last negative eps quarter because of seasonality. But again, all I care about is cash flow.


Albert said...

Management, on the last earnings call, refused to admit or deny that the Walmart account was even available. Maybe AE knows something else, but it isn't clear to me that PNDMF is even bidding for it (or is able to bid for it).

PlanMaestro said...

This definitely has always looked like a good whiteboard idea and finally its getting traction in the real world.

However, just one comment to Aaron on issues of style -not that he has to hear it if he does not want to. Giving price targets does not reflect very good on him or on any value investor. It looks like he is talking too much his game and seems too "promoter" like.

Being so badly wrong on earnings previously, where he has some control of the output, how he can talk about price targets where he has no control at all?

DaveinHackensack said...

I was surprised by the price target myself. I was also a little surprised by the lack of interest in positive earnings. I get the interest in cash flow, but at some point you ought to start generating positive earnings.