BrandPartners was out with news pre-open on Wednesday morning, and the news provided a nice little rally for the stock on the best volume we have seen so far this year.
The company announced it had signed $4.5 million in new contracts. While this is nice news, it is actually fairly routine for BPTR. I scanned the news release, looking an indication some of the news business was for Graffico or BPTR Europe, the two cash drain divisions on the company.
As it turns out, Graffico did contribute a part of the new business. BPTR Europe was not mentioned, much to my disappointment.
However, there was one unexpected surprise in the news release. Here’s the text:
“We are continuing to execute our growth strategy within our core business and anticipate stronger revenues and increased profitability in 2006,” said James F. Brooks, President and Chief Executive Officer of BrandPartners. “We believe our pipeline is strong as a result of our increased marketing efforts, so consequently we are focused on converting opportunities to bookings.”
Stronger revenues and increased profitability in 2006? I believe the phrase “increased profitability” is what the market liked.
The stock has now come a little off the $.40 bottom it had been camped on for the last month, albeit just by 10%.
Here’s a look at the chart:
To read the entire text of the press release, click here.
I have been looking for a signal to double up on this one. Here’s the way I am hoping to play it- I believe I will wait for the year end numbers to come out. I am expecting Q4 to be roughly akin to BPTR’s weak Q3 numbers.
I am hoping to see the stock swoon a bit on year end numbers, which I will view as a buying opportunity.
I am still holding 100,000 shares with a cost basis of $.60. I believe BPTR should get earnings traction again in ’06 and I want to double up. A little pullback on weak year end numbers could conceivably provide just the opportunity.
Comments and questions are welcome.
I sold the rest of my HESG, and HDY and continue to accumualte BPTR and KAL. I’ve seen other research speculating a $1.50 target for BPTR and $2.50 target for KAL within 12 months. I think it is at least a double for BPTR from these levels and tend to agree with the target for KAL. What are your thoughts?
Editor: I wouldn’t could HDY out as a potential for a trade. It seems to have 9 lives, and only 8 of them have been used up so far. If BPTR can return to its former profitable condition, I agreed on it being a $1 plus stock. This time it may stick. KAL is simply a question of time and a decent market environment for biotech. It won’t take much for a $2.50 stock on KAL. They can be a long way from an FDA approval, and still get that valuation easily.
BPTR First you told everyone to set stop orders at .39, and you said in the same article you talked to the CEO and he said they could not get all the money in the last quarter and it should roll over into this quarter. And now you have said nothing about a quarter with better than expectations. Don’t you remember saying this to everyone. I sold 30,000 of my shares at .55 for a loss which I bought for .82 and I have been waiting for this quarter to report hoping they would report with some good numbers and you now say they are probably going to dissapoint again. I have lost a full 2/3 of my entire wealth with you and from on I am sticking with CRAMER. You and your Microcaps and lousy and I measn really lousy investments.
Editor: For the one loser you site, there have also been a number of wins. However, that is your choice. Perhaps you should read a little more carefully. I said that I expected the company to continue to show lackluster numbers in q4, and have a much improved quarter in q1 ’06. q4 numbers aren’t even out yet. We are looking out to early May for q1 numbers. That is the quarter I am hanging my hat on, and their recent press release bears out that belief. I also don’t believe you should trade in either small and medium cap or microcap. I believe you should trade in both. I am currently featuring DXCM- a Cramer like small cap. Did you buy that one at $15- it is now $18 one month later.
Even though BPTR is trading on light volume, it continues to move upward. Everything seems to indicate a major push upward. I called up Trader’s Nation and their opinion was that BPTR is currently undervalued and that its current estimated market value is .75.
Editor: Other estimates are considerably higher. It looks very good to me, and I am thinking of doubling up when my DXCM trade works out.
A pretty blah conference call today. Nothing happending in Europe, Grafico shows some upside, but no real traction yet. They did say that 06 would beat 05 on rev, NOI and EBIDITA, but thats not saying much. The gross margins the last quarter were dismal, but according to mngmt should improve as the new GRAFICO stuff is higher margin. Perhaps they are just waiting for a lot of the old warrants to expire worthless, before they start to ramp things up. I’m buying more here, and hope they will attract a buyer through some of the new institutional money that came in at year end. This really seems like a company that should be taken private again.
Editor: I couldn’t agree more. I am sticking with my theme of waiting for q1 numbers before passing any judgement. Clearly, the stock needs some sort of catalyst to get moving. I still believe it is very undervalued, but value is the worst predictor of price performance. Thinking of adding to my position as well as I am flush with cash from the good luck I had with DXCM.
Earnings came out and there has been no change in BPTR price. Are you buying or waiting? It didn’t seem to be much of a sel off, although it had volume.
Editor: I am sticking with my theme of waiting for q1 numbers before deciding about any moves. The conference call was a complete snore. They seem to be getting some traction at Graffico, but BPTR Europe would appear to be lagging expectations. The stock looks like it would trade up nicely if there were a catalytic event. I might start accumulating again on dips.
Big volume so far today. Is there any news that you know of???
Editor: I have heard some rumors, none of which would make me rush out and buy the stock. Seems like the stock is behaving as if everything bad that could have happened has. I wasn’t particularly impressed with their conference call- sounds to me like Brand Europe is a bust- they have high expectations for Graffico. Perhaps the worst is behind us, but I still want to see those Q1 numbers.
Any further insight into the timing/quality of the first quarter earnings. The gap up in volume on the 7th may have been related to the retention of another investment advisor/promoter. In my opinion, these guys need to get back to their knitting and make money in their core market rather than trying to expand overseas. Hopefully Graffico will benefit from the increasing volume of business for sub-prime lenders as rates trend up. Great Call on DXCM, that was sweet!!
Editor: I missed the last conference call, but listened to the replay. It seems like Graffico is getting some traction, but BrandEurope is a bust. I would have called in and asked when they would shut it down if it didn’t start generating a return. They are probably spending $50k to $100k per month to keep that dog alive. Better that money goes straight to the bottom line.
Glad to hear someone else caught a nice profit on the DXCM trade. The stock is holding up amazingly well.
The Q1 numbers should be out this week, are you still expecting a significant improvement; the stock has been very quiet as of late; it looks like we could get some real upside pop if they back-up their statement in March that this year will be better in terms of rev. and profits. Any predictions?
Editor: To be honest, I have been so busy of late that I haven’t had the time to check with anyone who might be able to provide some flavor. All I can say is they better show major improvement, or I am probably going to throw in the towel.
Very disappointing quarter. The conf. call was upbeat however, and they did announce new contracts with 5 new clients. All in all I thought the stock would get hurt worse. CEO promised that they would make at least a nickel this year, same as last, and they swore the second quarter will be much improved. Lots of good questions from participants. I bought a little more here, and will hang in there. I hope things improve.
Editor: I am done with this one. I have better uses for my money, and could use the tax loss. The big issue for me- management has lowered its option conversion prices in spite of the company’s pathetic performance. Anytime management rewards itself for failure, that’s a stock I don’t want to own. Also- who wants to own a zero growth company? Sure, if they earn a nickel it is worth more, but there are better places for your money.
This is one of the few stocks covered that you, Market Byte have bought rather than been given, so it seemed like one of the best microcap picks after seeing the potential. What’s with the downfall. Not the worst numbers, but could there be an uptrend you envision within a year or two to get back up to $0.90 or $1. No mention of being bought out and issuing shareholders $1/share as had been rumored. Basically, if you did not need a tax loss, would you hold?
Editor: If I didn’t need the tax loss or the capital elsewhere, I would hold and perhaps buy more. If you read the most current blog which was published last night, you know I have decided to sell and move on. They finally wore me out.