3SOF

I think it bottomed. We'll see. It may retest the low.

You're right... appears to be the bottom.  I just might make $12.50 my entry point.  Hopefully this is a wise decision and I won't regret it later.  David's analysis make this stock look very attractive and I am a long term investor... so it appears to be a great buying opporutnity for me.

Looking good now.

Buying here at $12.50 good entry point

Hopefully,anyone buying under $13 will look back on this day and smile.

Wow I left out for the day now down -17% on the trade. Just bad luck  . I should of put a stop on the trade, I doubt I will be in green anytime soon.

I was just going over there last report and reading between the lines.
I think there earning will be downgraded alot more for 2007 and 2008.
looks for like  .48 for 2007  .68 2008
If we get a bounce tomorrow I will sell what i bought today.

Margins are decreasing, sales going up

Quote from: yukiii on March 30, 2007, 12:49:03 AM
I was just going over there last report and reading between the lines.
I think there earning will be downgraded alot more for 2007 and 2008.
looks for like  .48 for 2007  .68 2008
If we get a bounce tomorrow I will sell what i bought today.

Margins are decreasing, sales going up

Where did you get $0.48 for 07 and $0.68 for 08 yukiii? Thanks.

On Yahoo I see that estimates were lowered, but not to that point:



I believe there's some misunderstanding in all this, because analysts are expecting Q1 2007 to be the weakest of the year in revenue and EPS terms:



You see, they're expecting just $41.85 M in revenues in Q1 2007. But just two orders announced on January 3, 2007 will provide $55 M, so the estimate doesn't make sense at all:

• CECO Environmental Announces Two New Orders Totaling $55 Million
PR Newswire (Wed, Jan 3)

There are only two analysts covering the stock, and I guess they were the ones asking questions on Wednesday's conference call. One of them was making assumptions based on this $55 M order having been booked in Q4 2006, and the CEO or CFO replied "but that order had nothing to do with the 4th quarter, it didn't exist back then", something like that. If you have time listen to the CC yourself:

• CECO Environmental Earnings Call scheduled for 4:30 pm ET today
CCBN (Tue, Mar 27)

One analyst contacted by Reuters said he was expecting 18 cents EPS for the 4th quarter and got just 9 cents (hence the gap down on March 23). But probably that's the same man that thought the $55 M order would go to the 4th quarter numbers and he was wrong, it will go to the 1st quarter, 2007, instead.

Another issue is gross and net profit margin. Management clearly explained that there has been a change in their product mix towards the sale of more turnkey products. These products have lower gross margin, but higher net margin, and will increase the overall company's profitability. Management also said the $55 M order is a low gross margin project, but high net margin, because it will be almost all made by subcontracted companies.

When I came from the cinema yesterday and saw CECE down 17% I couldn't believe my eyes and I almost felt sick. But half an hour later I felt much better, as I'm getting used to volatility. There's a reason why I never get happy when I'm winning or a particular stock makes a good shot to the upside. That's because I don't want the opposite feeling, that is, the pain and sadness when losing. I try to maintain emotional equilibrium at all times.

As I analyze the situation, I see the potential for further downside due to the technical breakdown, but over the long term I see substantial value and a stock at new all time highs before 2007 closes.

I'll keep holding CECE.

It's a good thing I had to wait for my funds to settle until today. I wanted to get this for a few days now. I am glad...picked some up at 11.73   Hope it bounces back and the downgrades aren't too hazardous to this awesome looking stock.

QuoteI believe there's some misunderstanding in all this, because analysts are expecting Q1 2007 to be the weakest of the year in revenue and EPS terms:
You see, they're expecting just $41.85 M in revenues in Q1 2007. But just two orders announced on January 3, 2007 will provide $55 M, so the estimate doesn't make sense at all:

David, maybe you should send a mail to that analyst and explain him why he's wrong! 

I found this on some stock market blog:

Ceco Environmental recently reported Q4 06 results on March 22. They posted earnings of 0.09 per diluted share on revenue of 41.5 million. Revenue improved but the lack of earnings growth was a huge problem. In Q2 06 Ceco Environmental had earnings of 0.12 per diluted share on revenues of 31.7 million. This quarter they had almost ten million more in revenue but had three cents less in earnings. The lack of earnings growth and the huge run-up in the share price was a bad combination and the stock price has taken quite a beating in the last week.


Another problem with Ceco Environmental is dilution. In Q1 06 they had 10.91 million diluted shares. This quarter they have 13.17 diluted shares. Since earnings are not increasing the value of existing investor's holdings are declining.


I think Ceco Environmental is going to continue to decline and I would recommend watching the stock from the sidelines. If they can increase earnings in the future and stop diluting so much Ceco may be worth another look. 

Found these comments on the web regarding CECE

Ceco Environmental recently reported Q4 06 results on March 22. They posted earnings of 0.09 per diluted share on revenue of 41.5 million. Revenue improved but the lack of earnings growth was a huge problem. In Q2 06 Ceco Environmental had earnings of 0.12 per diluted share on revenues of 31.7 million. This quarter they had almost ten million more in revenue but had three cents less in earnings. The lack of earnings growth and the huge run-up in the share price was a bad combination and the stock price has taken quite a beating in the last week.

Another problem with Ceco Environmental is dilution. In Q1 06 they had 10.91 million diluted shares. This quarter they have 13.17 diluted shares. Since earnings are not increasing the value of existing investor's holdings are declining.

I think Ceco Environmental is going to continue to decline and I would recommend watching the stock from the sidelines. If they can increase earnings in the future and stop diluting so much Ceco may be worth another look.

David
How do account for the sales keep increasing and earning going down?

$31,000   .14
$37,000   .08
$41,000   .09

Quote from: lancefur on March 30, 2007, 10:47:36 AM
It's a good thing I had to wait for my funds to settle until today. I wanted to get this for a few days now. I am glad...picked some up at 11.73   Hope it bounces back and the downgrades aren't too hazardous to this awesome looking stock.

Nice entry price lancefur

Quote from: Se7en on March 30, 2007, 06:39:40 PM
David, maybe you should send a mail to that analyst and explain him why he's wrong! 

I don't know his name or e-mail, do you? I would like to know the reason why he's estimating $41.85 M in Q1 2007 revenues when just two orders represent $55 M in revenues? The justification can be that revenue from that order will be recognized across several quarters. There's no public information of the contract to check that out.

Quote from: yukiii on April 01, 2007, 03:33:06 PM
David
How do account for the sales keep increasing and earning going down?

$31,000   .14
$37,000   .08
$41,000   .09

Good question yukiii, let's put the relevant information on a table:



- Revenues are rising at a strong pace;
- Income Taxes in Q4 2006 were 71% higher than on the previous two quarters average;
- Net margin was healthy in Q2 2006, at a 4.92%, but declined to 2.83% in Q3 2006. Management attributed this to one large under performing project. Net margin didn't come back higher in Q4 2006 because of higher taxes. If taxes were at the previous quarters levels, Net income would have been $1.58 M, and net margin would then be 3.81%. Basic EPS would be $0.14;
- The share count has remained stable over the past 4 quarters, despite jumping from 2005 levels. But this company doesn't have an history of heavy dilution (just 3.57% average annual pace), as you can see on the historical share count below:



CECE has issues, but I believe the recent drop more than priced in those issues. The future looks better than the past, since the reported numbers don't show the recent big orders or the effect of the Effox acquisition, for example.

Technically the stock hit a support level and made huge volume on what seems to be a reversal candlestick. My current take is that over time the stock will claw back up and make new highs, but we'll keep studying it everyday to access the future potential of this holding.

I'll keep holding CECE.

SEC Filings for CECE > Form 10-K on 2-Apr-2007   

http://biz.yahoo.com/e/070402/cece10-k.html




Some other news:

EPA wins case on power-plant pollution
Last Update: 5:56 PM ET Apr 2, 2007

WASHINGTON (MarketWatch) --  U.S. utilities are likely to face stricter scrutiny of the pollution emitted by their power plants, following a Supreme Court ruling Monday in favor of the Environmental Protection Agency's new source-review program.

http://www.marketwatch.com/news/story/duke-energy-fails-prevail-power-plant/story.aspx?guid=%7B83A19082%2D39E1%2D4AB1%2DBC2E%2D667FF4A3C260%7D