Usually, I agree with most all of your analysis, b
Post# of 56324
Posted On: 06/14/2014 8:55:55 AM
Usually, I agree with most all of your analysis, but not here, lol.
1. I think the license process is what it is. The longer it takes, the less likely people are to think of FITX as a juggernaut that HC NEEDS, as Bill has made it sound. If Bill and Co were to already have the license and start the grow op without an announcement, that would be a separate issue. I'm not a fan of that route, but I know a lot are.
2. I agree about zoning. Worse case scenario, they could always "expand" to a new site that is more friendly and wants the taxable income.
3. As a long term position, I would agree. In the short term, I think the r/s are very detrimental. As you said, there is no assurance of capturing the market share. At this point, I think people either like or dislike FITX
I think dividends within a couple years would be a terrible way to reinvest in the company. At $0.01 per share, we're talking about $35M and at a low yield (as an example). That is $35M the company could have used to expand infrastructure. I think that Bill and co recognize this and understand that they need to immediately reinvest in growth versus in buybacks or dividends. FITX needs to capture the market and dominate it. They need to expand infrastructure, acquire assets, make agreements/partnerships and focus on sales. All of these cost money and should translate into a much higher pps than what would be gained from a buyback/dividend.
I view FITX as a growth stock with massive potential, where dividends are the exception. Long term (5 years or whatever) that would be a different story, but we are not an established business.
1. I think the license process is what it is. The longer it takes, the less likely people are to think of FITX as a juggernaut that HC NEEDS, as Bill has made it sound. If Bill and Co were to already have the license and start the grow op without an announcement, that would be a separate issue. I'm not a fan of that route, but I know a lot are.
2. I agree about zoning. Worse case scenario, they could always "expand" to a new site that is more friendly and wants the taxable income.
3. As a long term position, I would agree. In the short term, I think the r/s are very detrimental. As you said, there is no assurance of capturing the market share. At this point, I think people either like or dislike FITX
I think dividends within a couple years would be a terrible way to reinvest in the company. At $0.01 per share, we're talking about $35M and at a low yield (as an example). That is $35M the company could have used to expand infrastructure. I think that Bill and co recognize this and understand that they need to immediately reinvest in growth versus in buybacks or dividends. FITX needs to capture the market and dominate it. They need to expand infrastructure, acquire assets, make agreements/partnerships and focus on sales. All of these cost money and should translate into a much higher pps than what would be gained from a buyback/dividend.
I view FITX as a growth stock with massive potential, where dividends are the exception. Long term (5 years or whatever) that would be a different story, but we are not an established business.
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