Titan Delivering as Projected- But Not Exactly As the Headline Implies

Titan Global delivered Q3 numbers today, and they were off the charts. According to their press release, the company delivered $5.7 million in profits on $30 million in revenues. It was $.11 per share in earnings.

The stock should be $4 – right? not rocketing up the charts. Drilling down, the numbers are still quite good and suggest a market cap value far in excess of the roughly $50 million this one has.

However- look a little closer. Of the $5.6 million in profits they generated, $4.1 million was related to forgiveness of debt from a derivative. A one time, funny money accounting deal. Off operations, they really only made a profit of about $1.5 million. More like about $.03 or $.04 per share in earnings.

So, if you’re wondering why the stock is not charging out of the gates on this news, there’s your answer.

I am pressed for time this AM, so don’t have time to make a charge and comment on the technical side.

However, with the balance sheet improvements, these gyrations will eventually stabilize and this will be a very profitable company and continues to be undervalued. Technically, perhaps not a break out yet, but a great medium to long term hold for a big move later in the year.

4 thoughts on “Titan Delivering as Projected- But Not Exactly As the Headline Implies

  1. In my opinion, I’m going to wait for the 10Q before committing any capital even with what looks like good news. (I sold my shares last quarter after looking at their 10Q – it really wasn’t all that good. This company has complicated financials, and the balance sheet wasn’t anywhere near as clean as it could or should be. I think you really have to wait until the 10Q and read it thoroughly before deciding whether this one is worth taking a second look at. Well, that’s my opinion anyway. Good revenue line, though. That’s why I keep checking back.

    Editor: You are quite correct, and these are issues I have been bringing up since day 1. For this stock to trade at the kind of multiple it needs to, they have to clean up and simplify the balance sheet. It’s a mess and makes their numbers convoluted. However, on the glass half full side, that’s why the stock is trading at a mere $50 million market cap- giving people who are willing to take the risk a lot of upside. The biggest problem is lack of interest, which I’m hoping will change in the near term.

  2. Any news from CEO Bryan Chance during last Friday’s conference call? In particular any resolution from the expected June excise tax rebate arbitration?

    Editor: Will have something on that later today.

  3. Why is MSN Money and Yahoo reporting Earnings/Share as -0.14 and 0.18 respectively? Why the difference?

    http://moneycentral.msn.com/detail/stock_quote?Symbol=TTGL

    http://finance.yahoo.com/q?s=TTGL.OB

    Most of the small/individual investors i know use MSN money, and this is not showing up in thier “just turned profiltable” screens. That could be another reason why this is under-discovered.

    -Joseph

    Editor: I don’t know why their data provider is giving them differing information- I’ll forward this to the company for them to take action.

  4. Thanks for the newsletter update, the energy direction is unexpected, opaque and big. I look learning more from you when we see some numbers.

    But back to telecom. Did you learn more about the exise tax arbitration. Did it occur during June as anticipated? And if so, what was the outcome?

    Keep up the good work!

    Editor: A couple of their excise tax arbitrations have come through, but the biggest one, which I believe is AT&T, has not as of this time. I believe they are looking in the area of $8 to $12 million, and expect it to be resolved.