I listened to the CPNE conference call from yesterday’s quarterly results, and went through the 10Q filing. Here’s my initial impression- the stock might be a buy, but you have to be willing to buy into the idea that they will be successful with a new business model.
As I read between the lines, in short- their old subscription based business model has run its course, and their future focus will be on evolving to a whole new deal- basically, they are going to offer their internet marketing expertise to a bunch of other companies.
The board has clearly recognized there is a problem- new CEO and new CFO- Despite the fact that there was no open question and answer session again, at least we didn’t have to hear Mike Hill’s techno babble. He is no longer the spokesperson for the company.
Here’s the best news I can come up with- they made enough money to have the cash to buy another company which could give them a new direction. Here’s one big problem- a lot of that cash is tied up in the $4.8 million the banks are holding against charges and problems with the fees they are collecting. I can’t tell how much of that they will collect for sure, but if they collect it all, they have a strong balance sheet and some room to maneuver.
CPNE’s stock is trading reflective of a company headed in the wrong direction. As I disclosed on numerous occasions in this BLOG forum, I had sold every single share we owned at or above $.70, so I’m glad to be out right now.
Revenues for Q3 dropped 29% from Q3 of ’06, which is not a good sign. The company $2.7 million in non recurring charges for their “poor quality and fraudulent” sign ups over the last 2 quarters, and to unwind the deal with the printing company they bought.
No wonder they weren’t willing to speak about Q3 numbers in their mid August call- they were very poor.
Much to my disappointment, there was also no disclosure with any numbers about what they actually bought with the Iventa acquisition, so it’s hard to evaluate what’s going on there. They spoke about their new Web 2 Dashboard solution, but no information to quantify what it could mean to the company.
I suspect the worst of the damage is done now that the cat is out of the bag. There will probably be some sort of brief rebound, then the stock will go back and retest the low.
Could be an interesting speculation at this level, but you have to buy into the new management team and new direction for the company. I am not prepared to make that plunge at this time. I’d like to see some hard evidence that there is a turn around in place before committing any capital.
In my view there should have been more disclosure about the “misfortunes” of the company back in the Spring when the stock was trading so poorly. Perhaps this new management team will have more integrity.
Think about Jeff Feinberg’s fund who bought millions of insider shares at $1.90 last winter. He got his brains beat out in this one. The management is now spending his money while the company was headed down the tubes. Wouldn’t be surprised to see a law suit on that one.
If you buy into the new and evolving business model, it might be worth a punt. My capital is going to stay away for now until I have more hard facts.
Comments and questions are welcome.
Oh yea we are looking so good having a turd run CPNE. Mr. Anthony G. Roth did a crap job at utix.pk, if ‘crap’ means millions in the minus and a ‘going concern’ warning, all while pulling down over 300k a year. GREAT FIND CPNE! You found yourself a PROVEN FAILURE to run our company! There is no other way to see it. How much salary and stock are we going to have to pay this proven failure. How can the rat running from a sinking ship get onboard ours?
Yea, an RS is coming. They better play it safe and go 15 for 1 if they want to make sure of a $5 stock price.
I’m not even going to check the others past efforts to make a profit, but I would like to read what others have found out about the rest. Lots of Chiefs now to feed. I feel sick.
Editor: Thanks for the contribution. I hadn’t looked into his background, and its important to know. I must say, today’s news was a breath of fresh air as they have announced a conference all on Dec 5 to actually discuss the future, including financial projections and an open Q&A session. Who knows, perhaps this could take a turn in the right direction. I am not closed off to the idea. Thanks for your contribution.
Boy am I glad I sold the last of these shares a few days ago. It was your repeated comments, overt and not so overt that convinced me to get out
Thanks once again
Nigel
Editor: It’s been fun to get things right lately- With PNWIF, TTGL looking like it has lots of upside, SPKL, AAPL, and a few others, we’ve had some nice wins. However, getting out of a losing situation is just as important as finding winners. Preservation of capital allow you to live to fight another day.
after holding for almost two years (like an idiot), i thought-wait for Q3 numbers to decide, forgetting just how much lower a stock can open than previous close. instead of selling at $3.50 for enormous profit, i sold at $.45 for a 30% loss. i wouldn’t buy CPNE again if it was a penny! i would like to tell them what they can do with themselves and their company. months of non-disclosure is deceipt of the worst kind. to hell with commerceplanet!! plenty of “real” businesses to invest in here on OTCJ and elsewhere in the market to ever need consider a bunch of loosers like CPNE.
Editor: I’m not going to abandon it. I’m going to keep an eye on it. Sometimes there is opportunity in major problems. If the same management team were in charge of the company, I would abandon it and move on. However, at least these new guys speak English. Emotionally, I feel the same as you. I would like to grab those A-holes by the neck and wring it. Think about Feinberg- buying millions of shares from insiders at $1.90 while they were having problems. I would file a law suit if I were him.
Believe it or not but I spoke with CEO, Tony Roth and I am convinced that he has the plans to make things happen.
My suggestion along with other shareholders to offer the format for the December 5th conference call tells me he recognizes past mistakes ( lack of visibility / shareholder feedback ) is a step in the right direction.
He is going for .08/.10 earnings per share in six months and is going to give our competition a run for their money!
I am giving Tony the benefit of the doubt with his initial outreach to shareholders and the upcoming call.
If you are a shareholder and want to contact him here is the number:
Tony Roth
CEO
Commerence Planet
(805) 964-9126 ext 3143
I am bullish and buying shares!
Scott
Editor: Scott – thanks very much for the contribution. I do applaud the move to an open conference call and the offer of projections- If you have been following my content, you know I have been calling for this for 6 months. I am not ready to buy, but not opposed to seeing if they can really turn this thing around. I have no idea how they are doing with onlinesupplier at this point, and they haven’t proved a thing on the “new” business model. I believe it might take a little time for the market to believe, if it ever will. Nevertheless, the new management, so far, is a major improvement.
Do you think that CPNE will run up in advance of the press conference? I’m tempted to load up the truck at .30. Do you think buying before or possibly after (based on news) is the best strategy?
Editor: I don’t know if it will, but that is a pretty good idea. It seems to me the market might bid it up in advance of the call as it is so blown out. If you use that strategy, I would actually consider selling if it is higher just before the call in case there is disappointment. It’s similar to an earnings strategy. If you buy a stock in advance of an earnings release, and the stock is going up before the release, always sell before. It will always go down afterward, no matter how good the release. If it hadn’t gone up in advance, then you have a chance after the release.
I can’t listen to the cc. of yesterday.
Could you please say something about that here, and what abot the q. and a. situation…?
thanks so much!
Andrea.
Editor: I didn’t have time to listen either. However, I did read the press release. Strikes me as the first glimmer of honesty out of this company in a year. Clearly, a step in the right direction. However, it doesn’t seem as if the company is positioned to regain its audience for the stock.
I cought only about the last 15 minutes of the CC. The one piece of info I did catch seemed that the reverse split might be put on the back burner for now. The sentiment was in favor of this. Sorry I did not listen to more of the webcast. Also sorry to see a lower than expected revenue forecast and eps numbers. If you have time to go long here it may be a good play for the cost. But personally, I wish I was out to use the funds elsewhere.
Editor: anyone who owns any stock trading at its lowest point in a year wishes they were out. At this point you need to make a decision- do you lock in the tax loss this year and redeploy the capital elsewhere, or are you simply going to become a long term investor and wait it out? I don’t know if the tax savings would benefit you elsewhere, but that’s the only way to look at it from here.
Tony Roth has never run a successful company in his life. He’s a stock promoter who thinks he’s a CEO. he may come up with a couple of interesting ideas but the guy failed at running a cookie store. He may have convinced they people to make him a ceo but I wouldn’t touch this stock with a ten foot pole. He has absolulely no skills as a manager of people.
Editor: One mistake I have made in the past is not taking some of the postings investors put up on the boards as seriously as I should have. Don’t know him- I’ve never met him- but I have gotten some good information from contributors. This just shores up my viewpoint that there is nothing to do but wait for hard numbers. Were the cookies any good?