Dear subs - I have been getting a number of inquiries regarding the large trading volume today and the significant intra-day volatility. In short - I am not sure, but it could be 1) holders of existing convertible notes converting into equity and selling in the open market, or 2) short-term driven traders taking advantage of the recent rally to sell down. As for me, I am in this to see my thesis play out over the next 4-5 months, not sell out for a quick buck. Of course none of this is investing advice, and what any individual subscriber does is out of my purview, but just wanted to put this out there to pre-empt further questions regarding this topic. FWIW, I've personally had better results historically by being patient with my positions, rather than trying to frequently trade in and out of them and "timing the market"
nice post. Have read similar view in seeking alpha at a slightly lower price point. Two stocks with equal or lower valuations are CATO and DXLG yet completely different stories. Seems JAKK is more of short term play. Good idea.
I have a few quick thoughts about the recent trading action and feel like current share price ~$10.25 is ridiculous. Caveat Emptor as earnings are right around the corner, but I think subs should take this into account:
This company has a strong history of "snatching defeat from the jaws of victory." That's my experience anyway, I hope anyone long has better luck. I speculate that it's due in part to them not really having much power over the license holders and hence not being able to generate consistently good margins. Even if you're right investors are unlikely to rerate the multiple higher due to their past disappointments and a general view that they don't have a good business model. This is only my 2c but given how many good ideas are out there it's hard to dig into JAKK again!
Nice post Plum. Do you have any updates on JAKK that might account for the recent price decline. Has anything fundamentally changed with the business or your thesis?
Is this really a Halloween reopening play? Halloween accounts about 20% of annual sales (or high 20s in Q3). The COVID delta for 2020 Halloween sales was only $20M. Halloween sales also have lower than corporates average gross margin. It appears that the company's weak sales had more to do with poor merchandising in the Toys segment (still selling Frozen 2 toys).
Great post! Do you have any idea why CEO Berman has so few shares even though he's (supposedly) a co-founder? I've glanced through some older 10Ks and even in the oldest one I could find, from 1999, he has only 0.4% of the shares.
Great write up. Any colour on issues getting stock on time for Halloween, Chinese manufactures jacking up prices asked and container rates hitting 20,000 USD. How much cost push on merchandise have your factored in ?
Dear subs - I have been getting a number of inquiries regarding the large trading volume today and the significant intra-day volatility. In short - I am not sure, but it could be 1) holders of existing convertible notes converting into equity and selling in the open market, or 2) short-term driven traders taking advantage of the recent rally to sell down. As for me, I am in this to see my thesis play out over the next 4-5 months, not sell out for a quick buck. Of course none of this is investing advice, and what any individual subscriber does is out of my purview, but just wanted to put this out there to pre-empt further questions regarding this topic. FWIW, I've personally had better results historically by being patient with my positions, rather than trying to frequently trade in and out of them and "timing the market"
nice post. Have read similar view in seeking alpha at a slightly lower price point. Two stocks with equal or lower valuations are CATO and DXLG yet completely different stories. Seems JAKK is more of short term play. Good idea.
I have a few quick thoughts about the recent trading action and feel like current share price ~$10.25 is ridiculous. Caveat Emptor as earnings are right around the corner, but I think subs should take this into account:
https://twitter.com/Plum_Capital/status/1418601240607576070
https://plumcapital.substack.com/?r=1gmkra&s=r&utm_campaign=pub&utm_medium=web
Hi!
Do you expect a negative impact on JAKK from the supply chain issues?
https://edition.cnn.com/2021/08/29/business/toy-shortage-supply-chain-shipping-holidays/index.html
Thanks!
This company has a strong history of "snatching defeat from the jaws of victory." That's my experience anyway, I hope anyone long has better luck. I speculate that it's due in part to them not really having much power over the license holders and hence not being able to generate consistently good margins. Even if you're right investors are unlikely to rerate the multiple higher due to their past disappointments and a general view that they don't have a good business model. This is only my 2c but given how many good ideas are out there it's hard to dig into JAKK again!
Nice post Plum. Do you have any updates on JAKK that might account for the recent price decline. Has anything fundamentally changed with the business or your thesis?
Is this really a Halloween reopening play? Halloween accounts about 20% of annual sales (or high 20s in Q3). The COVID delta for 2020 Halloween sales was only $20M. Halloween sales also have lower than corporates average gross margin. It appears that the company's weak sales had more to do with poor merchandising in the Toys segment (still selling Frozen 2 toys).
Thanks for the post. Cute doggie, btw.
Great post! Do you have any idea why CEO Berman has so few shares even though he's (supposedly) a co-founder? I've glanced through some older 10Ks and even in the oldest one I could find, from 1999, he has only 0.4% of the shares.
Great write up. Any colour on issues getting stock on time for Halloween, Chinese manufactures jacking up prices asked and container rates hitting 20,000 USD. How much cost push on merchandise have your factored in ?