Ann: 1st Half FY19 Results Announcement, page-65

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05/03/19

15:23

Post #: 37659135
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Originally posted by Vmk Research ↑

Check and I would have a lot in common. We are always skeptical!

in this case. Pump? I hope that those who have read my posts carefully so far would conclude that I DO NOT RECOMMEND chasing the stock higher at the moment.

I have confessed that I like the product portfolio and I like the management and I like that some very smart people have vested their careers in LVT and accepted stock for the sale of their companies to LVT .

BUT I have also suggested that we can afford to wait until we have at least seen the March quarter numbers (and maybe even June), before coming to a conclusion on the stock. Above all else I think investors need to see solid proof that the company has passed the inflection point in cash burn before LVT can move to a new level. On a particular point, I pointed out the cost control numbers that management threw out in their January announcement are very demanding . Reducing overall costs by 15% without hurting marketing and R&D spend!!! In one or two quarters? Does anyone know how hard that is to do in practice? The selectivity and mental toughness required to weed out a cost base of 2 out of 10 in certain areas and still generate the employee enthusiasm and motivation that energizes a growth company is a hard balance to strike. Call me skeptical but most early stage growth companies fail to strike the right balance. They either prevaricate at making the cuts and run with too high a cost base (delaying progress to positive cash flow) or they make the cuts and demoralize the workforce (causing growth to stop in its tracks). Obviously it is better to err towards too high a cost base, it will pay off in the end rather than stopping growth and losing valuable employees. I have $10 here that bets they make progress in reducing costs but not as much as they hoped. I have no insights or info on how LVT are doing with cost control...its just my experience with young tech companies that , as a rule, they are not good at cost control. Management of young companies are full of enthusiasm and they dont like firing people or weeding out expenditures.

But I havent offered any real conclusions yet. If I seem inconclusive, its because Im laying out a thesis to debate, not conclusions, at least not yet.

I havent even started to lay out valuation parameters yet or what I see as catalysts for the stock. That comes next. Patience Padawan.

The Motley Fool articles seem much more like puff pieces to me and since they seem to be inspired by an interview with Regal....that is hardly surprising. But even so, I dont think the price action is coming from MF readers (not that I know much about who reads MF.....I dont!) or from the narrow band of people who are reading this thread.

But really, who knows from day to day? Its a market.

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You're right about MF articles being puff pieces. Generally, that's exactly what they are. I always laugh at their articles with the headline "Why the (insert name of any company) price crashed today." Then you read the article and it's usually because the company went ex-dividend or MF saying "even though there was no news out of the company." Yeah thanks for that MF.

LVT Price at posting: 41.5¢ Sentiment: Buy Disclosure: Held
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Ann: 1st Half FY19 Results Announcement, page-65

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