Avoid This Garbage

• Report this Comment On January 22, 2010, at 8:17 PM, 6StepsAhead wrote:

  Wow.....talk about irresponsible journalism! I smell a lawsuit by Carmike. If the author of this "garbage" had even a single clue as to why Carmike struggled last quarter, she'd have absolutely left them off this list.

  Carmike accellerated some depreciation on its older projector systems because they had replaced the old equipment with new digital and 3D projectors. They opted to accellerate the depreciation so that they could beat their competitors to teh market. In fact, Carmike is ahead of the larger movie exhibitors where this is concerned. Being in that fortunate position will absolutely lead to excellent growth.

  Carmike's debt ratio is high for two reason - new equipment and large amounts of tenant improvements that are required to keep movie theaters in good condition for above average viewing experiences. If Carmike didn't spend money to enhance the viewing experience, they would be slammed for allowing their theater conditions to deteriorate. So, wat happens? Carmike spends money to make the experience more comfortable for the client and they get trashed for carrying too much debt.

  Lastly, in the 4th Quarter of 2009, Carmike took an impairment charge associated with the contract buyout of its former CEO. Carmike will be north of $12.00 within 12 months, and if the 3D movie market continues it's upward demand, that number could even be higher.

  Let's just say we shouldn't GO ASK ALYCE for her opinion because it's nothing more than irresponsible garbage.

• Report this Comment On January 23, 2010, at 3:57 PM, bailsb wrote:

  I agree with the comments made by 6StepsAhead. This is very irresponsible journalism. My arguement is based on the past stock price level of Omnova. If you look at the history of this stock it has always been around $5 to $8. I think the author should have taken this into consideration before writing this article. Based on what I know about Omnova and the numbers they are posting this stock should be well north of $10 in no time.

• Report this Comment On January 23, 2010, at 5:55 PM, wildrick wrote:

  6StepsAhead you just fell 7stepsbehind.

  Carmike invested poorly in 2k digital cinema when 4k is going to be the industry standard.

  They failed to get proper estimates for the installation of this equipment and spent a fortune doing so because of it,

  Upgraded their facilities? Carmike is the master of letting their buildings degrade. This is why they stay in small markets with no competition. Go to any of your local Carmike theatres and tell me again they maintain and upgrade their facilities!

  Carmike's 3D investment was smart, however, now most theatres have 3D. Carmike has no competetive edge anymore and a matter of fact with the new 3D systems out at non-carmike theatres Carmike is now at a distinct disadvantage due to their inferior locations.

  This stock is heading no where near $12.00 more like $3.00 to $4.00.

  Invest in AMC or Regal and stay away from CKEC...a dangerous stock...

• Report this Comment On January 25, 2010, at 11:50 PM, 6StepsAhead wrote:

  Carmike's investment in 3D and other digital equipment has them far ahead of their larger competitors. After all, Carmike is a secondary market exhibitor meaning they serve areas that are not first tier. They are serving a particular niche unique only to them.

  Carmike will never compete with Regal or AMC. That's not their business plan. They're located in secondary markets. However, they made the deicision to spend now to jump out ahead of the larger exhibitors so that they could gain some market share. It's working fine, and YES, every Carmike facility that I've visted has been superior to Regal and AMC.

  Regal is filthy, overpriced, and the staff is a hinderance rather than a help. Carmike, on the other hand, keeps their theaters clean, the staff is helpful, and perhaps most important of all, their concessions are very reasonably priced.

  For a family taking in a show, there will not be an additional $50 for concessions. This fact is more valuable than you realize. When concessions are overpriced, viewers tend to bring their own candy and sodas with them. When they're reasonable priced, a viewer is more likely to buy from the exhibitor, and concession sales make up a large chunk of the overall revenue.

  Wildrick, before you throw in your 1 cent, make sure you have an argument. Regal and AMC both have agreed to leases over the long term that could very well bring them to their knees. How do they cover those cost? Oh yeah....that's right....they cut renovation costs, they delay the upgrade to digital, and of course......they pass the cost on to the consumer by raising prices for both films, and concessions

  Carmike, on the other hand, being located primarily in secondary markets, is paying far less per SF for facilities costs, but producing gross revenue comparable, or above, their competitors on a per SF and per theater basis.

  Yeah.....invest in Regal and AMC. After all, they've made up no ground in the past 12 months while the market popped. Their a bit busy trying to figure out how they're going to eat those giant leases they signed 5 years ago. You know, the ones where they could get the same property today for at least 30% less. That damned overhead kills you every time, doesn't it?

  Dude....get a clue. Make sure you have your facts in place before you throw out your analysis. Besides, for those of us who believed in CKEC to begin with, we've already realized a 1,000% gain.....that's right....1,000%.

  NICE!

• Report this Comment On January 26, 2010, at 12:20 PM, Juin99 wrote:

  I agree with 6StepsAhead!

  Alyce,

  Shouldn't you get the most recent earnings data before you post?

  FYI, Here is Valassis (VCI)'s Q3 earnings:

  http://finance.yahoo.com/news/Valassis-Reports-an-Increase-p...

  Press Release Source: Valassis On Thursday October 29, 2009, 10:59 am EDT

  LIVONIA, Mich., Oct. 29 /PRNewswire-FirstCall/ -- Valassis (NYSE: VCI - News) today announced financial results for the third quarter ended Sept. 30, 2009. We reported quarterly revenue of $544.1 million, a decrease of 3.5% from $563.7 million for the prior year quarter. The quarterly revenue decline would have been 2.8% excluding revenue of $3.8 million from divested and discontinued businesses in the prior year quarter. Third-quarter net earnings was $13.8 million compared to a loss of $5.2 million for the prior year quarter. Earnings per share (EPS) for the quarter was $0.28 compared to a loss of $0.11 for the prior year quarter. Net earnings for the quarter includes non-cash interest expense of $2.8 million ($1.7 million net of taxes), or $0.04 per share, related to the fair value of the interest rate swap contracts. For the third quarter of 2009, adjusted EBITDA* was $63.9 million, an increase of 82.0% compared to $35.1 million for the prior year quarter.

• Report this Comment On January 26, 2010, at 1:19 PM, Juin99 wrote:

  I find author's data for VCI is not up to date.

  Here is the most recent Q3 earngins report, which was released on Oct 29th, 2009, which is prior your posting date!

  Perhaps, you should dig deeper before posting such a shallow report.

  http://finance.yahoo.com/news/Valassis-Reports-an-Increase-p...

  Press Release Source: Valassis On Thursday October 29, 2009, 10:59 am EDT

  LIVONIA, Mich., Oct. 29 /PRNewswire-FirstCall/ -- Valassis (NYSE: VCI - News) today announced financial results for the third quarter ended Sept. 30, 2009. We reported quarterly revenue of $544.1 million, a decrease of 3.5% from $563.7 million for the prior year quarter. The quarterly revenue decline would have been 2.8% excluding revenue of $3.8 million from divested and discontinued businesses in the prior year quarter. Third-quarter net earnings was $13.8 million compared to a loss of $5.2 million for the prior year quarter. Earnings per share (EPS) for the quarter was $0.28 compared to a loss of $0.11 for the prior year quarter. Net earnings for the quarter includes non-cash interest expense of $2.8 million ($1.7 million net of taxes), or $0.04 per share, related to the fair value of the interest rate swap contracts. For the third quarter of 2009, adjusted EBITDA* was $63.9 million, an increase of 82.0% compared to $35.1 million for the prior year quarter.

  "We continue to outperform most media companies and are beginning to see signs of revenue stability," said Alan F. Schultz, Valassis Chairman, President and Chief Executive Officer. "Evidenced by a growing body of research, there is a permanent change in the mindset of today's shopper. We believe this deal-seeking lifestyle is a long-term phenomenon which favors our value-oriented media."

• Report this Comment On January 26, 2010, at 1:31 PM, Juin99 wrote:

  This so called "garbage" not only did not decline much in the 500+ points last week, but also it has moved up about 8+% in the past two days!

• Report this Comment On January 26, 2010, at 1:33 PM, Juin99 wrote:

  This so called "garbage" not only did not decline much in the 500+ points drop last week, but also it has moved up about 8+% in the past two days!

• Report this Comment On January 26, 2010, at 8:09 PM, wildrick wrote:

  6steps, I have been in over 30 percent of Carmike's buildings in the last 5 years and have analyzed many of their markets, how many have you been in?

  I find it interesting you did not address Carmike's outdated digital equipment or the millions they spent recklessly installing it.

  Thousands of 4k digital projectors are being installed by Carmike's competitors, Carmike is stuck with 2k projectors with the triple flash artifact problem in 95 percent of their buildings with 3D.

  You failed to mention Carmike has slashed all spending on repairs and maintenance in their buildings since the new CEO took control in order to make a profit anyway they can. It can now take weeks or even months to get things such as HVAC units, ice machines, signs, and restroom equipment repaired.

  You failed to mention Carmike has lost numerous markets in the last year because of poor operations, lack of customer service, and buildings that are falling apart in front of customers eyes.

  You failed to mention Carmike has a payroll inititiative that managers must cut payroll hours from the previous year no matter how it effects customer service.

  I do not know what theatres owned by Carmike you have been to, but you obviously do not have intimate knowledge of this company or their operations.

  Of the markets I have analyzed Carmike has usually had the highest concession prices by a very wide margin (sometimes 30 percent higher!) and is usually at or the highest ticket prices in those areas as well. Do not forget the special event charge of $3.00 more Carmike charged for the Michael Jackson movie that no other chain charged!

  Carmike medium sized niche markets are no longer safe, many competitors have realized Carmike is very vulnerable in these markets because they have never reinvested in these markets for decades in some cases. Sloped floors, understaffed buildings, ceiling tiles falling down around customers do not cut it anymore 6steps. This is not the 1980s where Carmike could get away with operating like this.

• Report this Comment On January 26, 2010, at 8:17 PM, wildrick wrote:

  6steps, I will also add..many of us made our 1200 percent on Carmike stock after they came out of bankruptcy when they emerged a very strong company, but that advantage was thrown away a long time ago by poor operations. That was the time to invest in Carmike, not now.

• Report this Comment On January 28, 2010, at 6:11 PM, wildrick wrote:

  6steps, since you have not replied I assume you are not going to and I would suggest before you regurgitate information you find online in company capsules or from company conference calls that you actually research a company you imply people should invest in it.

• Report this Comment On February 01, 2010, at 12:15 PM, urkiddingrite wrote:

  yep, fool. stay away from valassis, ESPECIALLY since they just took down newscorp.

  ALYCE LOMAX looks like a deer in the headlights on this one.

  "News America Agrees to Pay $500 Million; Signs 10-Year Shared Mail Distribution Agreement with Valassis Direct Mail"

  http://news.moneycentral.msn.com/ticker/article.aspx

  that's why they call it RESEARCH. first you do a search, (this company has traded in the 40's twice in the last 8 years) then you RE-SEARCH and LEARN about the company and it's history the current landscape and buy in at 1.05 and laugh all the way to the bank at this moment at 24.47!

  for garbage, this stuff tastes pretty good.

• Report this Comment On March 01, 2010, at 4:15 PM, 6StepsAhead wrote:

  I reserved my comments for precisely this time - just ahead of last quarter's results. Be careful as to your criticisms of "regurgitating" info that I've found on the internet. I made my investment in Carmike based on a thorough analysis of the last 4 Quarters worth of operating statements and results. You should never make an investment in something you don't understand. In Carmike’s case, it's the retail real estate market, and its impact, either positively or negatively, that will have a profound impact on the performance of this company. The real estate analysts say that this is Armageddon and that the glass is far less than half full. My company, on the other hand, believes the glass is more than half full, and that real estate matters could have an incredibly positive impact on Carmike's value. We are a real estate investment firm providing guidance for a number of Fortune 500 organizations. The movie business will generate what it always does. There will be peaks and valleys depending upon the strength of the movie roster. How a company approaches asset management is more critical than the movie roster that generates the revenue. If you can decipher what I just said above, then the next time out of the gate you'll understand how to invest in theater exhibitionist organizations and other organizations that depend heavily on efficient management of its asset base. If you can't, then you should pick another type of genre to invest in. By the way, since January 22nd, I've purchased stock during a decline stage, that was associated directly with this article. A good chunk of that has returned over 30% on my investment. I’ve now placed a stop-loss order to protect myself in the event another irresponsible and uninformed article such as this one, is written. I still believe that by year’s end, Carmike will be at or above $12/Share.

• Report this Comment On March 01, 2010, at 4:38 PM, 6StepsAhead wrote:

  Wildrick, I'd also like to mention that you accused me of not mentioning "Carmike's outdated digital equipment and the millions they spent recklessly installing it find it interesting you did not address Carmike's outdated digital equipment or the millions they spent recklessly installing it", when in fact that was one of the first things I addressed in my original comments.

  Here is my original comment: "Carmike accelerated some depreciation on its older projector systems because they had replaced the old equipment with new digital and 3D projectors. They opted to accelerate the depreciation so that they could beat their competitors to the market."

  If you understand corporate accounting, you must accelerate depreciation on capital expense items (such as projector systems) if the item has not yet been fully depreciated according to schedule. Carmike obviously felt that it was more valuable to beat its competitors to market with the 3D equipment, even if it meant showing additional losses associated with accelerating the depreciation of the older equipment.

  You see, the "analysts", the same people that claim to be experts in particular business genres, don't understand the underground of a company's performance. Aside from the obvious way a company makes money, there are many invisible variables at work that will impact the bottom line.

  In this case, "Don't Ask Alyce" never mentioned any of the most important invisible variables that made a difference.

  The only way I would use Alyce's information is to short a stock, and then buy the hell out of it all the way down as a result of the negative press. Then, when it heads back up, you'll make a fortune.

• Report this Comment On March 01, 2010, at 4:57 PM, 6StepsAhead wrote:

  See, you should never ask Alyce anything...

  http://finance.yahoo.com/news/Carmike-Cinemas-Reports-EPS-bw...

  This after another incompetent analysts reported that Avatar would both help and hurt Carmike because they had committed too much of their annual exhibition allotment to Avatar. Again, just another mis-informed expert.

  Based on this, Carmike should easily hit 12 within the next 6 months, and based on this quarter's production, the movie schedule for the remainder of 2010, and opportunities associated with other more discreet variables, I would not be surprised to see this stock hit 15 or better by year's end.

  Enjoy!

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