Re: [CANSLIM] CANSLIM for sourcing shorts

From: Eric Jaenike <ericjaenike@yahoo.com>
Subject: Re: [CANSLIM] CANSLIM for sourcing shorts
Date: Thu, 2 May 2002 08:03:26 -0700 (PDT)
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 Re: fundamentals for PFCB, the primary concerns I've heard voiced revolve around comp stores sales growth and market penetration. Comp store sales growth for the bistro have been slowing and, for older stores, has turned negative. Comp store sales for the Pei Wei Diner, an apparently large part of the growth story, have turned negative for the earliest stores (I believe they've only built 7 to date).
There appear to be concerns regarding the total number of locations that can support a high ticket Chinese restaurant. Average check is something like $18, which would tend to limit profitable locations to more metropolitan areas. This raises concerns regarding the current multiple.
FWIW.
Eric
  Tom Worley <stkguru@bellsouth.net> wrote: Hi Ian,

Aside from funds owning 59%, I see nothing wrong with the fundies on this
one. Not sure why you think it is over valued. And industry group is A as
well.

Tom Worley
stkguru@bellsouth.net
AIM: TexWorley
- ----- Original Message -----
From: "Ian" 
To: 
Sent: Wednesday, May 01, 2002 5:16 PM
Subject: [CANSLIM] CANSLIM for sourcing shorts


Often, I keep a small list of 'CANSLIM' darlings as potential short
candidates - usually things with average balance sheets and huge valuations.
One of those that has been on my list for a while is PFCB.

In the last couple of weeks, PFCB has had 4 exceptional volume days without
any meaningful advance - even though each day was 'green'. IMHO, that is the
distribution that I have been looking for. I have a short here in the high
$72's, that I will stop out if it goes through $74.50 from here.

WIth a split upcoming, it is easily possible that I get stopped out - but I
am risking just 1 1/2 points, and my reward could be 20 points +. PFCB
trades at what I consider an extremely high valuation, given their cash
generation, in a capital intensive business. If I had been long the stock, I
would have taken the recent advanceless volume days as sell signals.


We'll see.

Ian






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<P> Re: fundamentals for PFCB, the primary concerns I've heard voiced revolve around comp stores sales growth and market penetration. Comp store sales growth for the bistro have been slowing and, for older stores, has turned negative. Comp store sales for the Pei Wei Diner, an apparently large part of the growth story, have turned negative for the earliest stores (I believe they've only built 7 to date).
<P>There appear to be concerns regarding the total number of locations that can support a high ticket Chinese restaurant. Average check is something like $18, which would tend to limit profitable locations to more metropolitan areas. This raises concerns regarding the current multiple.
<P>FWIW.
<P>Eric
<P>&nbsp; <B><I>Tom Worley &lt;stkguru@bellsouth.net&gt;</I></B> wrote: 
<BLOCKQUOTE style="PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #1010ff 2px solid">Hi Ian,<BR><BR>Aside from funds owning 59%, I see nothing wrong with the fundies on this<BR>one. Not sure why you think it is over valued. And industry group is A as<BR>well.<BR><BR>Tom Worley<BR>stkguru@bellsouth.net<BR>AIM: TexWorley<BR>----- Original Message -----<BR>From: "Ian" <IANSTM@SHAW.CA><BR>To: <CANSLIM@LISTS.XMISSION.COM><BR>Sent: Wednesday, May 01, 2002 5:16 PM<BR>Subject: [CANSLIM] CANSLIM for sourcing shorts<BR><BR><BR>Often, I keep a small list of 'CANSLIM' darlings as potential short<BR>candidates - usually things with average balance sheets and huge valuations.<BR>One of those that has been on my list for a while is PFCB.<BR><BR>In the last couple of weeks, PFCB has had 4 exceptional volume days without<BR>any meaningful advance - even though each day was 'green'. IMHO, that is the<BR>distribution that I have been looking for. I have a short here in the high<BR>$72's, that I will stop out if it goes through $74.50 from here.<BR><BR>WIth a split upcoming, it is easily possible that I get stopped out - but I<BR>am risking just 1 1/2 points, and my reward could be 20 points +. PFCB<BR>trades at what I consider an extremely high valuation, given their cash<BR>generation, in a capital intensive business. If I had been long the stock, I<BR>would have taken the recent advanceless volume days as sell signals.<BR><BR><BR>We'll see.<BR><BR>Ian<BR><BR><BR><BR><BR><BR><BR>-<BR>-To subscribe/unsubscribe, email "majordomo@xmission.com"<BR>-In the email body, write "subscribe canslim" or<BR>-"unsubscribe canslim". Do not use quotes in your email.<BR><BR><BR><BR><BR>-<BR>-To subscribe/unsubscribe, email "majordomo@xmission.com"<BR>-In the email body, write "subscribe canslim" or<BR>-"unsubscribe canslim". Do not use quotes in your email.</BLOCKQUOTE><p><br><hr size=1><b>Do You Yahoo!?</b><br>
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