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CUI Global 3Q19 results -3
17:35 12-Nov-19
CUI Global's conference call has just concluded after only two
analyst questions. I found the new CEO's discussion interesting,
but not compelling. None of the original 4 companies from the
Nikola transaction are still under consideration, and I agree that
avoiding bad transactions is key. The focus on new
telecommunications and renewable energy infrastructure also sounds
good, but the clock is ticking. On that point, GasPT
opportunities are being maintained and monitored, but the company
can't wait any more. Management hopes to make an announcement at
the end of the year for a purchase at 4-6x EBITDA.
CUI Global's position is still very different from that of
Superconductor Technologies, which issued a death's door report
of its own this morning, but $30M also isn't a lot to work with.
It may be that tightening capital markets will offer up something
worthwhile, but I'm of the opinion that deploying capital to
stocks like CVA and BGCP is a better course of action under
current market conditions.
CUI Global has reported on its third quarter:
- a loss of 1 cent per share
- from $6.1M
In the wake of the sale of the Power & Electromechanical segment these results are not comparable to analyst estimates. Management blames Brexit for weakness in the U.K. and says that it will now be free to turn its full attention to "acquisitions and organic growth" in the energy business. While I appreciate the lack of dilution so far, in my opinion, it needs to offer much more detail than that on the conference call, which is at 5pm.