Do your own Due Diligence. The author is invested in GEE GROUP (NYSE: JOB). First of all, I did not generate that idea on my own but found the initial investment thesis on www.valueinvestorsclub.com. The thesis is very compelling as it fits exactly into my investment framework. You get this Cigar Butt $ for 0.54c with the optionality to become a good compounder.
I thought you might find Wexboy's write up on CPL Resources interesting, although it's a bit dated and the company has since been acquired. It offers good insights into recruitment firms' business model that could also be relevant to your investment in Gee Group.
You should take note of the "clean profit" in 2021 for Q1 primarily stems from extinguishment of debt, and hence normalized earnings should be near zero in my opinion.
Thanks Paul for bringing this to my attention. So the PPP loan was forgiven and is being recognized as nearly 16.8 million in net income for 2022. So unless I am mistaken, this accounting will basically zero-out the NOL carryovers, right?
Still a compelling thesis. I'm not feeling confident yet about what the market re-rate might be though on a P/E level. I still need to complete my own research on this to get a better gauge on the potential upside.
What does management intend to do with the cash flow? Is it the same one that did the risky flawed acquisition? Any chance they will screw it up again? Any likelihood of capital return back to shareholders?
Hi Paul, It looks like you are adding the entire amortization. What is the amortization actually expensing? and how do you know that it wont be a real cash expense going forward?
Hi Paul,
Thanks for the excellent write-up!
I thought you might find Wexboy's write up on CPL Resources interesting, although it's a bit dated and the company has since been acquired. It offers good insights into recruitment firms' business model that could also be relevant to your investment in Gee Group.
https://wexboy.wordpress.com/2019/12/10/cpl-resources-a-most-talented-company/#more-17478
Cheers and keep up the good work!
Hi Paul.
Thanks for posting this idea :-)
You should take note of the "clean profit" in 2021 for Q1 primarily stems from extinguishment of debt, and hence normalized earnings should be near zero in my opinion.
Best Anders
Thanks Paul for bringing this to my attention. So the PPP loan was forgiven and is being recognized as nearly 16.8 million in net income for 2022. So unless I am mistaken, this accounting will basically zero-out the NOL carryovers, right?
Still a compelling thesis. I'm not feeling confident yet about what the market re-rate might be though on a P/E level. I still need to complete my own research on this to get a better gauge on the potential upside.
Cheers!
What does management intend to do with the cash flow? Is it the same one that did the risky flawed acquisition? Any chance they will screw it up again? Any likelihood of capital return back to shareholders?
Hi Paul, It looks like you are adding the entire amortization. What is the amortization actually expensing? and how do you know that it wont be a real cash expense going forward?