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Meade stock - gulp!

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#1 Rick Woods

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Posted 22 October 2008 - 12:30 PM

So far today, Meade is down from $0.24 to $0.23. :(

#2 imjeffp

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Posted 22 October 2008 - 12:31 PM

At least it's still listed. Get some while you can!

#3 Paula E

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Posted 22 October 2008 - 03:08 PM

You only have until Feb 2, 2009 to buy some before the Naz delists them.

It's at $0.22 at the moment, although with such miniscule volume I'm not sure a 15% movement one way or another means a whole bunch. The volume today so far is 14,690 shares - a whopping $3231 - less than the price of a single 10" LX200-ACF.

Sad to see how far they've fallen.

#4 snowdragonusa

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Posted 22 October 2008 - 03:50 PM

So here is a newbie question for you all... what happens with the shares you own if a company is delisted?

#5 ColoHank

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Posted 22 October 2008 - 04:32 PM

If the company is delisted, the stock may still be traded OTC (Over-The-Counter). Many investors don't bother with OTC listings and other venues for trading so-called penny stocks. If the company goes belly-up, shareholders lose.

#6 Joel

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Posted 22 October 2008 - 05:26 PM

At this price I wouldn't mind buying shares if I could get printed stock certificates for nostalgic purposes.

#7 christurner

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Posted 22 October 2008 - 05:44 PM

If I were Celestron, I know what I would do!

#8 bicparker

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Posted 22 October 2008 - 09:04 PM

Their earnings conference call had two analysts and one person listed as an investor who was apparently upset that he couldn't get some parts for his scope. I read the transcript and was fascinated that neither analyst asked any questions about the delisting notice and what was planned regarding it.

The discussion focused mainly on three things: 1) They are using their sales of assets and their current credit line to subsidize their operating expenses, and 2) They are still planning additional cost cuts to their operating costs, including staff cuts and other G&A (not R&D), and 3) They are projecting a pessimistic outlook in the near future. That last item was highlighted in an interesting discourse by the CEO, who basically said (in a response to a question) that they were meeting their projections and their projections were not good.

Their current market capitalization is about $5.1 million now (at their close of $0.22 today). This is way way under their book value (IIRC, about $14 million). Most of their assets are in accounts receivable and inventory, which they mentioned on the call are pledged against their credit facilities.

Basically, under NASDAQ rules, I'm not sure that there is any way they can maintain their listing, come February. But, given the absence of that discussion in the earnings call, that may, in fact, be an expected outcome.

BTW, a couple of other tidbits on that conference call... 1) Coronado manufacturing was also moved to the Mexico facility, 2) For both Meade and Coronado, they are severely backlogged and backordered on parts and finished products, and 3) They haven't been able to get any takers to lease out space at their empty (and expensive) Irvine facility.

#9 MartyT

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Posted 23 October 2008 - 09:30 AM

and one person listed as an investor who was apparently upset that he couldn't get some parts for his scope.


Don't suppose his name was Pete, was it? :shocked:

#10 Pess

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Posted 23 October 2008 - 10:06 AM

So here is a newbie question for you all... what happens with the shares you own if a company is delisted?



It just trades on the pink sheets.

The problem with Meade is that the company is virtually insolvent and expectations are for a bankruptcy.

If the company files for BK protection, then shareholders will hold worthless stock certificates. The current stock price reflects this rather obvious future.

This was patently obvious a couple years ago and discussed somewhat in numerous threads here, but many took issue with comments on Meades demise so it kinda tapered off.

Pesse (Sort of like saying she hasn't really sunk yet because the crows nest is still above water.) Mist

#11 Paula E

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Posted 23 October 2008 - 02:36 PM

$0.20 so far today.

#12 Paula E

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Posted 24 October 2008 - 02:03 AM


Meade's stock price vs. S&P 500

This is an ugly chart, unless you bought before 1999 and sold in 2000.

#13 bicparker

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Posted 24 October 2008 - 06:27 AM

Their financials show them with a $24 million net worth while the market value of their stock is $4.67. That is wacky out of line.

At this point, I think their stock price is pretty meaningless anymore. No one is buying their stock and those that are holding aren't really going to sell. I don't know what the float (and I'm referring to whatever the practical trading float is) on this stock is, but I suspect it is small. If someone really wanted to, they could jack up the price of this stock with very little trade volume.

I'm not really sure what to make of Pess's saying that they will go bankrupt. That's a broad statement since they could either go chapter 11 (re-organization) or chapter 7 (liquidation). But, the only problem is that they really aren't insolvent. Kind of tough to declare bankruptcy with a current ratio of 2.61. It still makes more sense for them to liquidate outside of bankruptcy (which is what they have been doing for the past year and a half or so).

That doesn't mean that their financials aren't in trouble. Their balance sheet is fine (in fact, a lot of companies would love to have that kind of balance sheet). But their expenses are still too high, and as they said on the earnings call, they are going to have to cut more jobs and other Selling and General expenses.

They are downsizing... a lot. This isn't the $100+ million company that it was a few years ago (it couldn't make money back then either). Their empty Irvine facility is a big albatross around their neck right now now.

#14 Paula E

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Posted 24 October 2008 - 10:51 AM

Their financials show them with a $24 million net worth while the market value of their stock is $4.67. That is wacky out of line.


The market is wacky out of line right now. The wheels have more or less come off the wagon.

At this point, I think their stock price is pretty meaningless anymore. No one is buying their stock and those that are holding aren't really going to sell. I don't know what the float (and I'm referring to whatever the practical trading float is) on this stock is, but I suspect it is small. If someone really wanted to, they could jack up the price of this stock with very little trade volume.


No doubt. The precipitous 15% drop that started this thread was on <$5000 volume! I wonder if everyone on the Meade forum bought 100 shares of Meade, all at the same time, if it would pop up the share price above $1? :roflmao:

The reason I posted the chart is that I think it points out that institutional investors likely dumped Meade's stock years ago, and haven't looked back. Delisting isn't so bad - it's not like anyone is going to touch this thing with a 10 foot pole. Basically other than catching a piece of the internet bubble for a brief time, the stock from Meade has been a pretty lousy investment - to put it mildly.

That doesn't mean that their financials aren't in trouble. Their balance sheet is fine (in fact, a lot of companies would love to have that kind of balance sheet). But their expenses are still too high, and as they said on the earnings call, they are going to have to cut more jobs and other Selling and General expenses.


It seems to me that their other problem is that they really have to make their line of credit last. (Or hey, become profitable.) Because it's hard to imagine they'd be able to secure additional credit anytime soon, given the present problems in the credit market, right? I think it would have been hard for them before. I think it's basically impossible at the moment.

I think it's good they have a backlog to work from. It seems to me that it's very possible that the market for astronomical gear might shrink rather rapidly, at least for a time, given the current financial mess. People seem to be panicked at the moment.

Perhaps by the time they are through their backlog, the world will be a bit calmer, and the business climate will improve for them.

#15 GJJim

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Posted 24 October 2008 - 07:29 PM

The only question now is who will acquire the inventory and other assets. This holiday buying season is going to be brutal and there is no credit available for even healthy companies. IMO Meade is not alone in this predicament and we may see other big name companies merging or sold in the coming financial storm.

#16 bicparker

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Posted 25 October 2008 - 10:48 AM

Their financials show them with a $24 million net worth while the market value of their stock is $4.67. That is wacky out of line.


The market is wacky out of line right now. The wheels have more or less come off the wagon.


The market is off, but this disparity in Meade's stock price vs book is over 2 years old. This wacky stuff with them has little to do with the stock market conditions.

You are right, at this point, the only institutional investors of note are small cap specialists who have board membership and voting control (i.e., Sonkin's Hummingbird Fund).

I think the biggest take-aways for Meade product owners or potential owners from this last earnings call and the associated financials are that : 1) Meade is fighting a backlog on manufacturing, which also means that parts availability will be thin, 2) This Christmas season will be make or break with them.

It is also a bit concerning that they have ~$20 million in inventory and have a large backlog. To me that means that their inventory, by and large, is made up of low margin department store scopes that they can't sell. They probably aren't writing it down at this time because they will need to draw funds on their line of credit, which is partly secured by their inventory (A/R secures the rest).

Their A/R went up this last quarter by $2 million, but that is to be expected going into the Christmas season. Even then, $2 million might be considered too small of a bump since, in prior years, A/R increased quite a bit more going into the last quarter of the year.

They have to shave expenses, but they don't have enough room there to make profits. In short, they have to sell more LX-class scopes with higher margins.

#17 quantumac

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Posted 27 October 2008 - 03:11 PM

Meade's troubles are a comment on our times.

Why buy a telescope when you can plant yourself in front of a gigantic 42 inch widescreen monitor and play World of Wastecraft all hours of the night? Oh, and lest I forget, mom and dad will buy the house a new, blazingly bright outdoor GE safety light to keep you "protected" while you're wasting your time. Why look at the sky? After all, it's just an unfathomable orange glaze.

People just don't value astronomy anymore. Why spend time with the natural world when you can live in a purely artificial, brightly lit one, where you get to smash things?

#18 Rick Woods

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Posted 27 October 2008 - 05:14 PM

What I want to know is, where do I get a pair of those cool glasses?!?

#19 Paula E

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Posted 27 October 2008 - 06:14 PM

It is also a bit concerning that they have ~$20 million in inventory and have a large backlog. To me that means that their inventory, by and large, is made up of low margin department store scopes that they can't sell. They probably aren't writing it down at this time because they will need to draw funds on their line of credit, which is partly secured by their inventory (A/R secures the rest).


That seems logical to me. Scary, but logical.

One question I have is "who is trading this stock?" The price moves around based on an incredibly small number of trades. I have never paid much attention to stocks that traded for less than $1. (Although I do understand why it has such crazy price swings - the volume is just super low.) Who trades shares like this, and why?

#20 Kolenka

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Posted 28 October 2008 - 03:03 AM

Meade's troubles are a comment on our times.

Why buy a telescope when you can plant yourself in front of a gigantic 42 inch widescreen monitor and play World of Wastecraft all hours of the night? Oh, and lest I forget, mom and dad will buy the house a new, blazingly bright outdoor GE safety light to keep you "protected" while you're wasting your time. Why look at the sky? After all, it's just an unfathomable orange glaze.

People just don't value astronomy anymore. Why spend time with the natural world when you can live in a purely artificial, brightly lit one, where you get to smash things?


As a guy who owns a 42" widescreen TV, plays video games, and has a 10" LX200R in his living room... for shame. :lol:

Not all of us ignore the environment, and we do like to share time with both nature and our electrical gadgets. Although I do know people who simply don't really care much about experiencing nature either.

#21 Matthew Ota

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Posted 28 October 2008 - 03:57 AM

I recall that Meade makes more profit from their cheaper telescopes than from their LX class scopes. The LX class scopes were manufactured for corporate pride. They do not make much money on their flagship scopes.

#22 Taylor

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Posted 28 October 2008 - 05:33 AM

Meade's troubles are a comment on our times.

Why buy a telescope when you can plant yourself in front of a gigantic 42 inch widescreen monitor and play World of Wastecraft all hours of the night? Oh, and lest I forget, mom and dad will buy the house a new, blazingly bright outdoor GE safety light to keep you "protected" while you're wasting your time. Why look at the sky? After all, it's just an unfathomable orange glaze.

People just don't value astronomy anymore. Why spend time with the natural world when you can live in a purely artificial, brightly lit one, where you get to smash things?


As a guy who owns a 42" widescreen TV, plays video games, and has a 10" LX200R in his living room... for shame. :lol:

Not all of us ignore the environment, and we do like to share time with both nature and our electrical gadgets. Although I do know people who simply don't really care much about experiencing nature either.


Same here, there is nothing better on a rainy day outside to place a beautiful .50 cal round straight through the bad guy's head on Xbox Live.

But when nature calls, my Nexstar 8 GPS is there with me at 2am in the shivering cold...

#23 christurner

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Posted 28 October 2008 - 12:13 PM

Time for a hostile take over don't ya think! There must be someone from Celstron looking into this like hungry predators.... I know I would be!

#24 Kolenka

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Posted 28 October 2008 - 12:29 PM

Time for a hostile take over don't ya think! There must be someone from Celstron looking into this like hungry predators.... I know I would be!


Well, except any takeover wouldn't be by Celestron. Celestron is just a brand now, not a company. Synta (owner of the Celestron name) would be the one eyeing Meade, but really, the only things Meade has that Synta might want are patents to things like the ACF corrector design.

Beyond that, Synta already has the manufacturing capabilities that Meade does, and minus scopes like the LX400 on the MaxMount, covers the same lines Meade does. Synta doesn't need to buy Meade at this point, and I'd think they would pass in an attempt to not accumulate more debt.

Also, a hostile takeover only really works when you have enough people/firms holding stock willing to sell. If you can't buy your way to 50% + 1 stock, the hostile takeover fails. All it takes is the one guy who currently has controlling interest deciding not to sell (as it is worthless right now anyways).

#25 Clive Gibbons

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Posted 28 October 2008 - 01:57 PM

Stock down to 18 cents (or thereabouts).

Big sale announced for "MySky Plus" at $149 (OPT).
MySky was supposed to be the company's salvation... a huge earner. No such luck. Now, they just want to sell 'em cheap to generate cash flow.
Wal-Mart used to be a really big client, especially for Xmas merchandising. Nobody seems to know if Wal-Mart is even dealing with Meade for this season. :shrug:

By springtime, they'll be pushing up the tulips at this rate. X-p


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