Author Topic: KONA - Kona Grill  (Read 21220 times)

atbed

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Re: KONA - Kona Grill
« Reply #130 on: July 13, 2017, 07:42:19 AM »
I'd love to buy at some point. Maybe there is some speculating money to made here for a pop before the next recession.
I'm not sure how they will avoid bankruptcy if we get a recession in the next 2 years.
For some scuttlebutt, I stopped at a location recently and the traffic was just ok (not busy but not a ghost town). The prices on the menu seem high to me in relation to the value. Maybe I'm just cheap.

Even I am surprised at how far & how fast KONA has gone down in price.  If the bank is tightening the line of credit, they are clearly anticipating future trouble.

The next quarter's numbers will be pretty important. 

If they can't make money now (and in recent past), how are they going to do it in the future?  This is especially true if the economy goes down in any significant way.

I think KONA has to address their fundamental problems FIRST before it becomes a good speculation.

Hey all:

After having a snack and relaxing for a few minutes and thinking about KONA, I may have been wrong in my prior posting....

I now think that maybe KONA got out ahead of this "problem" that they are having and contacted the bank.  Could it be that they anticipated breaching the covenants of the line of credit?  That they wanted to avoid that situation.  That they contacted the bank and got the terms changed/loosened in return for the line being reduced by 1/3?

If I am correct, then this was the correct/good move to make.  I think management clearly anticipates trouble ahead.  I think they also probably know at this point that there will be closings, at least one.

I am further going to speculate that this next quarter OR one more after that, they will announce closing(s), maybe have some other big shakeups/changes and announce a big charge off.  I am going to guess that the stock will further go down.  Shortly after that, I am going to guess that might be the time to buy if you are inclined to speculate.

In my opinion, I would rather invest my money in casual diners like CAKE, BWLD, and BJRI. KONA deserves to trade at a discount to those names. Obviously KONA stock becomes more compelling as it falls and the gap widens. But a low valuation must be weighed against higher risk.


DTEJD1997

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Re: KONA - Kona Grill
« Reply #131 on: July 13, 2017, 09:37:59 AM »
In my opinion, I would rather invest my money in casual diners like CAKE, BWLD, and BJRI. KONA deserves to trade at a discount to those names. Obviously KONA stock becomes more compelling as it falls and the gap widens. But a low valuation must be weighed against higher risk.

Oh my yes, there are better names in the industry...I would put FOGO on that list...but at some point KONA will become a tempting speculation, even for me!

The question is, where/what is that price?  KONA is hitting a new 52 week low as I type this, at $2.60.  What if it goes below $2?  What if it goes below $1?  What if they close some locations and take a big charge?  Shake up management/BOD? 

Of course, you've got the real possibility that it simply keeps going down and does not reverse course and eventually becomes a doughnut.

I got an offer for some free food for the location near me, so maybe I'll go and see what it is like.  If I am not mistaken, the location near me is in an A++++ location.

atbed

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Re: KONA - Kona Grill
« Reply #132 on: July 13, 2017, 11:58:38 AM »
In my opinion, I would rather invest my money in casual diners like CAKE, BWLD, and BJRI. KONA deserves to trade at a discount to those names. Obviously KONA stock becomes more compelling as it falls and the gap widens. But a low valuation must be weighed against higher risk.

Oh my yes, there are better names in the industry...I would put FOGO on that list...but at some point KONA will become a tempting speculation, even for me!

The question is, where/what is that price?  KONA is hitting a new 52 week low as I type this, at $2.60.  What if it goes below $2?  What if it goes below $1?  What if they close some locations and take a big charge?  Shake up management/BOD? 

Of course, you've got the real possibility that it simply keeps going down and does not reverse course and eventually becomes a doughnut.

I got an offer for some free food for the location near me, so maybe I'll go and see what it is like.  If I am not mistaken, the location near me is in an A++++ location.

I would be very interested to hear what you think about the location.

I haven't been able to visit a Kona. But FOGO, BWLD, CAKE, and BJRI all appear more differentiated than KONA. So I'm not convinced KONA's concept belongs in the same class.

But at some point, it could be an interesting. No argument there. I just don't see it yet.

I hope SSS are positive in 2Q, but I won't be involved because I am not smart enough to see why.

wescobrk

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Re: KONA - Kona Grill
« Reply #133 on: July 14, 2017, 11:37:23 AM »
Any guesses what FCF can be starting in 2018 if they can just stabilize SSS and assuming they never open another restaurant? (at least for a year or two)

atbed

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Re: KONA - Kona Grill
« Reply #134 on: July 15, 2017, 07:33:39 AM »
Any guesses what FCF can be starting in 2018 if they can just stabilize SSS and assuming they never open another restaurant? (at least for a year or two)

4-7M

wescobrk

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Re: KONA - Kona Grill
« Reply #135 on: July 15, 2017, 07:38:36 AM »
Based on 4-7 million and not growing, I'm guessing the stock would be worth around $4-$7 a share.
Based on the risk, if we get into the 1's on trading, this could be interesting.

ebdem

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Re: KONA - Kona Grill
« Reply #136 on: July 17, 2017, 05:04:54 AM »
They just set their Q2 Call on 31.07 4:30 p.m. ET. Let's see what the result will be.

wescobrk

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Re: KONA - Kona Grill
« Reply #137 on: July 26, 2017, 04:07:45 PM »
I picked up some around $2.55. We'll see if I bought too early and high on Tuesday.
If they can stabilize sss, and start paying off debt, we can see it go to $7-10.
We'll see how the next 12 months goes.

ebdem

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Re: KONA - Kona Grill
« Reply #138 on: Today at 12:55:29 AM »
Hope it works out.
By the way, they are planning a new opening in may 2018: http://www.cleveland.com/orange-village/blog/index.ssf/2017/07/orange.html

wescobrk

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Re: KONA - Kona Grill
« Reply #139 on: Today at 06:14:13 AM »
 I would prefer they don't open anything until they straighten the ship.
I liked that they cancelled the other two restaurants to open this year and that they got abatements on 2 of the troubled 5.
Pay off debt and if the stock is still in the low single digits then buy back stock with free cash flow then the stock soars and they can start expanding and do a secondary offering to shore up the balance sheet for the next recession.
The board owns a lot of stocks so they are incented to make intelligent decisions.
Time will tell.