Stock Tip - Nubblies.net Forums

Ugly Bastard · 03-17-2008, 12:40 PM

Typically I wouldn't care to share a stock tip in a public forum just because of all the second guessing that people I don't even know can do down the line, but I think there's a lot of value in a stock unknown to most of you right now: LUB

Luby's is a cafeteria chain based mostly in Texas. Their share price is currently at 7.38. Some of my position in this company was purchased at 11.00 about six months ago. I liked it then, and I really like it now.

There has been a lot of selling pressure on this stock for reasons that have nothing to do with the company's performance:

* First, as I hope most of you know, the market has been in a crisis since last fall due to bad mortgage loans. There has been a lot of fear in the market, so people have been selling like crazy. Luby's has dropped considerably along with the rest of the market for no particular reason

* Second, a few months ago, a hedge fund with a ~15% holding in Luby's made a run at the board of directors. Basically, they wanted to run the company (for reasons that may or may not have been in the best interest of long term shareholders). A vote was held, and the hedge fund was defeated. They decided to throw themselves a pity party and have been unloading their position. So basically there's been a huge demand to sell 15% of the company, which has caused the stock price to drop.

* Today, the stock is down 8% after a major shareholder had a margin call placed on his brokerage account. FC will know what that means. If you don't, a simple way of looking at it is that a guy who owned a lot of this stock was forced to sell it today because some banks came looking for some money that he owed them.

In all three of those points, there was a lot of selling for no reason relating to the company's performance.

On to the good:

* Luby's appeals to baby boomers. They're only going to be having more time on their hands, and more desire for yummy cafeteria food in the upcoming decade. If you go into a Luby's, it's actually quite depressing. Lots of old people and minorities waiting in a huge line for their liver and onions.

* Luby's owns nearly all of the land on which their stores reside.

* They have no debt.

* They make money.

At 7.38, the stock is priced like it might be going out of business. I assure you it won't. They own all their land, have no debt, and make a profit!

I realize most of you don't exactly have piles of cash you can put into the market, but if you can come up with even just a few hundred dollars, LUB, imo, is a great buy. I would characterize its chances of it being worth double it's current value sometime in the next 5 years as "quite good". As far as investments go, you'll be hard pressed to find anything better.

LUB, FTW!

THEINCREDIBLEdork · 03-17-2008, 01:16 PM

So you make this post so we buy the stock and the price goes up

f3lix · 03-17-2008, 02:17 PM

Sounds pleasing. Food chains are always scary though. I'll look into it though.

Ugly Bastard · 03-17-2008, 02:21 PM

Yea ID, 'cause you broke motherfuckers and your $200 are going to affect a $100,000,000+ company's stock price.

vaga1220 * · 03-17-2008, 02:31 PM

One share please!

DJ FC · 03-17-2008, 03:27 PM

I like it.

Thanks UB... I may actually buy some.

THEINCREDIBLEdork · 03-17-2008, 05:08 PM

Quote:

Originally Posted by Ugly Bastard

Yea ID, 'cause you broke motherfuckers and your $200 are going to affect a $100,000,000+ company's stock price.

i was making joke

f3lix · 03-17-2008, 05:52 PM

The main thing I don't like about the stock is that it just keeps dropping. And big. Have we found the bottom yet? I think I'll wait till some positive life is shown. Maybe the 3Q report will save you in a few days.

Ugly Bastard · 03-17-2008, 06:02 PM

Wow f3lix. Waiting for that sure thing, huh?

It's called a Certificate of Deposit.

Have fun being a nit.

THEINCREDIBLEdork · 03-17-2008, 06:23 PM

I'm going to buy 250 shares. big money

f3lix · 03-18-2008, 03:59 AM

Being a nit and being stupid are two different things... here's what my dad (very nitty investor) had to say about it when I asked him what he thought...

Luby's ranks 53/67 of a restaurant group which is 138/197 and headed in the wrong direction. Restaurants of all kinds are facing increased food and
transportation costs and finding it hard to pass along the increases-many of the upscale ones are substituting cheaper ingredients or changing menus
(from more meat to more pasta) rather than hiking prices, but the effect is the same - their outlook as a group is not positive going into the near future.
Luby's in particular has a poor chart in an overall bad market. I looked at this stock back in the late 90s but at that time it wasn't expanding, I don't know
if that has changed- if restaurant chains aren't expanding, they're dying (albeit slowly). Look to see if same-store sales are increasing from year to year- you probably won't be able to find out if same store net income is improving- chains don't normally release that info- although they should. If they own the land their shops are on, it might be the company is more
valuable for its assets than its operations which wouldn't be a reason for the stock to appreciate in value. My opinion is pass.

Ironic Mustache · 03-18-2008, 04:04 PM

Is it possible to share a share? I've got a few bucks.

f3lix · 03-25-2008, 09:29 AM

Following a less-than-stellar 2Q earnings report for Luby's, the Motley Fool had this to say.

Growth on the Menu at Luby's?
March 24, 2008

If you're not from Texas, you probably don't get it. Luby's (NYSE: LUB) cafeterias are a Texas tradition -- right up there with SeaWorld and the Alamo. Where else can you go to get premium chicken-fried steak smothered in gravy, served up in a cafeteria-style setting where you can visit with all your neighbors on Sunday after church?

Fresh off a stunning proxy fight victory in which Texas natives gave the hook to the IRS slicksters, the company says it's poised for a growth surge. Yes, after gradually closing 14% of its restaurants over the past five years, the company believes it is newly energized and ready to take on the big boys in the cafeteria-dining space.

Still, though, fourth-quarter results looked a lot like they have for the past few years. Sales inched up 0.6%, with comparable-restaurant sales down about 1.6%. Those comps are pretty much in line with soft results we've seen over the past year from trendier casual-dining chains like Brinker (NYSE: EAT), Ruby Tuesday (NYSE: RT), and Darden (NYSE: DRI).

Operating earnings tumbled 84%, though part of the decline owed to expenses used to fight the proxy battle. Plus, rising food costs from skyrocketing commodity and energy prices were only partially offset by menu-price increases, and thus negatively impacted the gross margin. The bottom line came in at $0.01 per share. I won't bother to compare this to analyst expectations, since only one firm follows the stock, and it was apparently out trying on cowboy boots instead of accurately forecasting earnings.

In all seriousness, though, the company is run by one of the Pappas brothers. The family has done pretty well with the privately owned Pappasito's and Pappadeaux concepts. There are not a lot of restaurants in those chains, but the lines are long, and the food is outstanding.

I certainly don't expect Luby's to be the next Buffalo Wild Wings (Nasdaq: BWLD), and neither does Wall Street. Growth projections for the next five years are only 7%, and I also just don't see the demand there for that many new cafeterias. The company is valued at a market cap of $200 million -- slightly higher than the book value of its facilities, since Luby's owns a significant portion of the land and buildings it occupies. However, the company is selling at a hefty 18 times trailing earnings, which may not be justifiable given its growth outlook.

Dent · 08-04-2009, 04:44 AM

Luby's, Inc. - Google Finance

?
I searched for hiking, I have no knowledge of this thread, but what happened?

Ugly Bastard · 08-04-2009, 11:45 AM

Stock market collapsed and LUB got crushed (like just about everything else). Oops.

f3lix · 08-04-2009, 09:53 PM

Quote:

Originally Posted by f3lix

The main thing I don't like about the stock is that it just keeps dropping. And big. Have we found the bottom yet? I think I'll wait till some positive life is shown. Maybe the 3Q report will save you in a few days.

Quote:

Originally Posted by Ugly Bastard

Wow f3lix. Waiting for that sure thing, huh?

It's called a Certificate of Deposit.

Have fun being a nit.

Kinda funny...

In hindsite, LUB tanked for the next several months before it had one week where it was higher than the time UB posted about it. It crashed right after that and hasn't recovered since.

Ugly Bastard · 08-05-2009, 02:19 AM

I was very wrong about this, of course. My punishment was not your "I told ya so's", it was losing $50k. It came with a lesson, at least.

f3lix · 08-05-2009, 05:55 AM

That's TWICE you've put all your eggs in one basket.

03-17-2008, 12:40 PM	#1 (permalink)
Ugly Bastard Senior Member Join Date: Feb 2002 Location: U.S.A. Posts: 13,643 Internets: 247330	Stock Tip Typically I wouldn't care to share a stock tip in a public forum just because of all the second guessing that people I don't even know can do down the line, but I think there's a lot of value in a stock unknown to most of you right now: LUB Luby's is a cafeteria chain based mostly in Texas. Their share price is currently at 7.38. Some of my position in this company was purchased at 11.00 about six months ago. I liked it then, and I really like it now. There has been a lot of selling pressure on this stock for reasons that have nothing to do with the company's performance: * First, as I hope most of you know, the market has been in a crisis since last fall due to bad mortgage loans. There has been a lot of fear in the market, so people have been selling like crazy. Luby's has dropped considerably along with the rest of the market for no particular reason * Second, a few months ago, a hedge fund with a ~15% holding in Luby's made a run at the board of directors. Basically, they wanted to run the company (for reasons that may or may not have been in the best interest of long term shareholders). A vote was held, and the hedge fund was defeated. They decided to throw themselves a pity party and have been unloading their position. So basically there's been a huge demand to sell 15% of the company, which has caused the stock price to drop. * Today, the stock is down 8% after a major shareholder had a margin call placed on his brokerage account. FC will know what that means. If you don't, a simple way of looking at it is that a guy who owned a lot of this stock was forced to sell it today because some banks came looking for some money that he owed them. In all three of those points, there was a lot of selling for no reason relating to the company's performance. On to the good: * Luby's appeals to baby boomers. They're only going to be having more time on their hands, and more desire for yummy cafeteria food in the upcoming decade. If you go into a Luby's, it's actually quite depressing. Lots of old people and minorities waiting in a huge line for their liver and onions. * Luby's owns nearly all of the land on which their stores reside. * They have no debt. * They make money. At 7.38, the stock is priced like it might be going out of business. I assure you it won't. They own all their land, have no debt, and make a profit! I realize most of you don't exactly have piles of cash you can put into the market, but if you can come up with even just a few hundred dollars, LUB, imo, is a great buy. I would characterize its chances of it being worth double it's current value sometime in the next 5 years as "quite good". As far as investments go, you'll be hard pressed to find anything better. LUB, FTW!
	Last edited by Ugly Bastard; 03-17-2008 at 12:42 PM.

03-17-2008, 01:16 PM	#2 (permalink)
THEINCREDIBLEdork Emperor Meow Join Date: Sep 2004 Posts: 9,350 Internets: 290966	So you make this post so we buy the stock and the price goes up
	#YOLO

03-17-2008, 02:31 PM	#5 (permalink)
vaga1220 * *Dislikes ham Senior Member Join Date: Jul 2005 Location: HELL 666 Posts: 1,518 Internets: 60790	One share please!
	Putting the sensual in non-consensual.

03-17-2008, 03:27 PM	#6 (permalink)
DJ FC MURICAN Join Date: Jul 2004 Location: Virginia Posts: 5,136 Internets: 253094	I like it. Thanks UB... I may actually buy some.
	The basis of our governments being the opinion of the people, the very first object should be to keep that right; and were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter. But I should mean that every man should receive those papers and be capable of reading them.

03-17-2008, 06:23 PM	#10 (permalink)
THEINCREDIBLEdork Emperor Meow Join Date: Sep 2004 Posts: 9,350 Internets: 290966	I'm going to buy 250 shares. big money
	#YOLO

03-17-2008, 02:17 PM	#3 (permalink)
f3lix Gangnam Style Join Date: Oct 2003 Location: DH's Massage Parlor Posts: 6,383 Internets: 213510	Sounds pleasing. Food chains are always scary though. I'll look into it though.

03-17-2008, 02:21 PM	#4 (permalink)
Ugly Bastard Senior Member Join Date: Feb 2002 Location: U.S.A. Posts: 13,643 Internets: 247330	Yea ID, 'cause you broke motherfuckers and your $200 are going to affect a $100,000,000+ company's stock price.

03-17-2008, 05:52 PM	#8 (permalink)
f3lix Gangnam Style Join Date: Oct 2003 Location: DH's Massage Parlor Posts: 6,383 Internets: 213510	The main thing I don't like about the stock is that it just keeps dropping. And big. Have we found the bottom yet? I think I'll wait till some positive life is shown. Maybe the 3Q report will save you in a few days.

03-17-2008, 06:02 PM	#9 (permalink)
Ugly Bastard Senior Member Join Date: Feb 2002 Location: U.S.A. Posts: 13,643 Internets: 247330	Wow f3lix. Waiting for that sure thing, huh? It's called a Certificate of Deposit. Have fun being a nit.

03-18-2008, 03:59 AM	#11 (permalink)
f3lix Gangnam Style Join Date: Oct 2003 Location: DH's Massage Parlor Posts: 6,383 Internets: 213510	Being a nit and being stupid are two different things... here's what my dad (very nitty investor) had to say about it when I asked him what he thought... Luby's ranks 53/67 of a restaurant group which is 138/197 and headed in the wrong direction. Restaurants of all kinds are facing increased food and transportation costs and finding it hard to pass along the increases-many of the upscale ones are substituting cheaper ingredients or changing menus (from more meat to more pasta) rather than hiking prices, but the effect is the same - their outlook as a group is not positive going into the near future. Luby's in particular has a poor chart in an overall bad market. I looked at this stock back in the late 90s but at that time it wasn't expanding, I don't know if that has changed- if restaurant chains aren't expanding, they're dying (albeit slowly). Look to see if same-store sales are increasing from year to year- you probably won't be able to find out if same store net income is improving- chains don't normally release that info- although they should. If they own the land their shops are on, it might be the company is more valuable for its assets than its operations which wouldn't be a reason for the stock to appreciate in value. My opinion is pass.

03-18-2008, 04:04 PM	#12 (permalink)
Ironic Mustache G'd up from the feet up. Join Date: Jan 2005 Location: Cali Posts: 7,146 Supreme Emperor of the Jiu Jitsu Shit Forum?: Yes Internets: 114735	Is it possible to share a share? I've got a few bucks.
	Creeping around as I please nonchalantly like any other Supreme Emperor might.

03-25-2008, 09:29 AM	#13 (permalink)
f3lix Gangnam Style Join Date: Oct 2003 Location: DH's Massage Parlor Posts: 6,383 Internets: 213510	Following a less-than-stellar 2Q earnings report for Luby's, the Motley Fool had this to say. Growth on the Menu at Luby's? March 24, 2008 If you're not from Texas, you probably don't get it. Luby's (NYSE: LUB) cafeterias are a Texas tradition -- right up there with SeaWorld and the Alamo. Where else can you go to get premium chicken-fried steak smothered in gravy, served up in a cafeteria-style setting where you can visit with all your neighbors on Sunday after church? Fresh off a stunning proxy fight victory in which Texas natives gave the hook to the IRS slicksters, the company says it's poised for a growth surge. Yes, after gradually closing 14% of its restaurants over the past five years, the company believes it is newly energized and ready to take on the big boys in the cafeteria-dining space. Still, though, fourth-quarter results looked a lot like they have for the past few years. Sales inched up 0.6%, with comparable-restaurant sales down about 1.6%. Those comps are pretty much in line with soft results we've seen over the past year from trendier casual-dining chains like Brinker (NYSE: EAT), Ruby Tuesday (NYSE: RT), and Darden (NYSE: DRI). Operating earnings tumbled 84%, though part of the decline owed to expenses used to fight the proxy battle. Plus, rising food costs from skyrocketing commodity and energy prices were only partially offset by menu-price increases, and thus negatively impacted the gross margin. The bottom line came in at $0.01 per share. I won't bother to compare this to analyst expectations, since only one firm follows the stock, and it was apparently out trying on cowboy boots instead of accurately forecasting earnings. In all seriousness, though, the company is run by one of the Pappas brothers. The family has done pretty well with the privately owned Pappasito's and Pappadeaux concepts. There are not a lot of restaurants in those chains, but the lines are long, and the food is outstanding. I certainly don't expect Luby's to be the next Buffalo Wild Wings (Nasdaq: BWLD), and neither does Wall Street. Growth projections for the next five years are only 7%, and I also just don't see the demand there for that many new cafeterias. The company is valued at a market cap of $200 million -- slightly higher than the book value of its facilities, since Luby's owns a significant portion of the land and buildings it occupies. However, the company is selling at a hefty 18 times trailing earnings, which may not be justifiable given its growth outlook.

08-04-2009, 04:44 AM	#14 (permalink)
Dent Lost in Hilbert Spice Join Date: Jun 2004 Location: Surrounded by knaves and fools Posts: 3,520 Internets: 183146	Luby's, Inc. - Google Finance ? I searched for hiking, I have no knowledge of this thread, but what happened?

08-04-2009, 11:45 AM	#15 (permalink)
Ugly Bastard Senior Member Join Date: Feb 2002 Location: U.S.A. Posts: 13,643 Internets: 247330	Stock market collapsed and LUB got crushed (like just about everything else). Oops.

08-05-2009, 02:19 AM	#17 (permalink)
Ugly Bastard Senior Member Join Date: Feb 2002 Location: U.S.A. Posts: 13,643 Internets: 247330	I was very wrong about this, of course. My punishment was not your "I told ya so's", it was losing $50k. It came with a lesson, at least.

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08-05-2009, 05:55 AM	#18 (permalink)
f3lix Gangnam Style Join Date: Oct 2003 Location: DH's Massage Parlor Posts: 6,383 Internets: 213510	That's TWICE you've put all your eggs in one basket.