ITEX

[Munger]

I had started a position that remained tiny because the stock is so illiquid and the recent share gift to the CEO gave me pause.

 

Nice business model economics, excellent balance sheet, and the stock appears extremely undervalued if trailing cash flows can just be sustained.

 

However -- given the 8K filing this morning, I have liquidated all shares in the company.  The CEO appears to believe ITEX is his personal piggy bank.  The compensation package is egregious for a company this size -- cash salary will equal 50% of annual FCF!!!!  Moreover, the CEO reloaded with an additional share gift.  Worse -- he announced that he is selling stock despite the company being so undervalued.  History shows that this behavior by the CEO often leads to disaster for shareholders.  Highlights the appeal of Michael Dell -- over the past 18 months he has purchased $200 million of stock with his own money, adding to his multi billion $ stake...this doesn't guarantee success for DELL but I like having the CEO on our side.

 

Some (most?) on this board don't like Biglari but wouldn't mind unleashing him on this company/CEO -- I know he owns some stock.

[DCG]

I think Parsad has interest in this company (as he's mentioned on here before and to the point where he might actually not be able to discuss it here). I looked into them last year, read through some of their annual reports, etc and came away very unimpressed with their management. Even their website/marketplace seems to be quite a mess, IMO.

[Ballinvarosig Investors]

Nothing on EDGAR yet, can anyone reproduce the filing?

[Munger]

I sincerely apologize to anyone who read my post on ITEX -- I made a mistake.

 

However -- no regrets on selling the stock...not comfortable with the CEO share gift.

 

Excellent business model economics, great balance sheet, and undervalued company -- so there is def potential to make money in this stock but the CEO is not for me.

 

Here is the mistake....

 

I also follow a company called Iconix -- an 8k re their Iconic cam in on my newsfeed today and I quickly read, mistaking for ITEX.

 

Iconix -- is an interesting company.  The CEO has created a lot of value.  Business model economics are outstanding.  However, too much debt on the books for me...but worth monitoring if they commit to paying down debt.

 

[Junto]

Shareholder Group, Led by David Polonitza, Seeks to Replace ITEX Corporation’s Two Non-Executive Directors http://finance.yahoo.com/news/Shareholder-Group-Led-by-bw-2269648120.html?x=0

 

For those of interest.