Melissa Davis, senior editor of The Street Sweeper, poses with celebrity stock picker Jim Cramer after a recent taping of his "Mad Money" television show. Davis worked as an investigative reporter for TheStreet.com, where Cramer serves as chairman, before assuming her current role at The Street Sweeper.
EBIX: Caught with Its Hand in the Cookie Jar
by Melissa Davis, 3/30/2015 9:49:57 AM
Editor’s Note: To simplify matters, TheStreetSweeper has provided links to many of the documents that it used to prepare this investigative report – along with the detailed instructions necessary to replicate its calculations and verify its claims – in a lengthy series of endnotes that appear at the bottom of this story.
Ebix (Nasdaq: EBIX) better learn how to control its appetite. The last time that the hungry rollup company raided the cookie jar, the firm may have finally pushed its luck a little bit too far.
After relying on a blatant accounting trick to artificially sweeten its fourth-quarter earnings – and then concealing the hefty gain that allowed it to beat profit estimates that it would have otherwise missed – Ebix left behind some rather incriminating evidence. In the formal 10-K report that it filed a few days after it pulled that brazen stunt, the company provided enough fresh clues to reveal (among other juicy secrets reserved for later stories) the following:
· Ebix added millions of dollars to its net income last year by impatiently reversing most of its reserves for potential “earn-out” payments to the very acquisition target responsible for the celebrated European contract that the company just won.
· Following its acquisition of two companies in the first half of 2014, Ebix swiftly reversed all of the potential earn-out bonus for the first and most of that for the second by the end of that same year. Ebix recognized at least a portion of the resulting decline in its earn-out liabilities as net income and may have aggressively booked far more generous gains before its recent acquisition targets ever got a legitimate chance to actually prove themselves.
· After reversing most of the reserves that it established for earn-out payments to many of the firms that it has purchased in recent years – without formally impairing any of the goodwill assigned to those companies – Ebix must have finally resigned itself to the inevitable. Since its goodwill balance increased by a smaller amount than the goodwill assigned to the firms that it purchased during the fourth quarter, Ebix clearly recognized some kind of write-down but apparently decided to bury that disturbing evidence.
Ebix ignored a request by TheStreetSweeper to quantify the reserves that it originally established for each one of the firms that it acquired over the past several years, along with any adjustments that it made to those contingent liabilities and any gains that it recorded as a result, in spite of the profound difference that earn-out reversals have repeatedly made in its financial results.
TubeMogul: It's All About The Numbers (And They Aren't Pretty)
by Sonya Colberg, Senior Investigative Reporter, 3/24/2015 11:20:20 AM
New industry data on TubeMogul (TUBE) provides a brutal reality check for the digital video advertising company that has recently become a Wall Street darling.
This infatuation has given TubeMogul an optimistic $400 million market valuation. But that valuation is not supported by key industry factors defined by big-data analysis firm comScore.
The data on unique video views and ad videos viewed show that TubeMogul’s performance is falling behind the rest of the industry.
TubeMogul’s ad view traffic began its downhill slide in December, falling 9 percent. January ad views year-over-year dropped almost 21 percent in January and more than 16 percent in February.
In contrast, BrightRoll, a Yahoo division, enjoyed 116 percent growth YOY in December, 44 percent in January and 39 percent in February.
The trend for TubeMogul, then, has clearly been just the opposite of the industry in December, January and February.
See various viewpoints here, and the chart below. Our chart shows key comScore data. The data mashes month-by-month figures for Google, BrightRoll, AOL, LiveRail (Facebook acquisition), SpotXchange, Specific Media, Hulu, Tremor Video, Videology Inc. and TubeMogul going back as far as June 2009.
JAMN Finally Spills the Beans -- And It's an Ugly Mess
by Janice Shell, 6/2/2011 10:32:51 AM
To be sure, the 10-K offered investors little reason to sing. For starters, the filing reveals, this once-hot “coffee company” sells no coffee of its own at all. JAMN relies on a supplier based in frigid Canada – far away from the tropical Jamaican home of its co-founder Rohan Marley – to provide the company with an actual product to sell to its customers instead.
Back in April of 2010, JAMN inked a “supply and toll agreement” with Canterbury Coffee of British Columbia that gave it access to some brew. According to that agreement, JAMN relies on Canterbury to fulfill every role – save a minor one – normally satisfied by a firm that classifies itself as a coffee company. Canterbury purchases the coffee beans. It roasts them. And it then packages them in bags supplied by JAMN – the company’s only real product – for sale to the public.
JAMN signed this deal more than a year ago, right before Shane Whittle – a notorious Vancouver stock promoter – officially resigned as CEO of the company. But the company never mentioned that agreement, seemingly material enough to warrant at least a quiet 8-K report, in a single regulatory filing until now.
Jammin Java (JAMN): Hot Stock ... Bitter Aftertaste?
by Janice Shell, 6/2/2011 10:30:25 AM
It’s time to wake up and smell the coffee! That’s exactly what Jammin Java (OTC: JAMN.OB), a heavily promotedcoffee company, and – for very different reasons – TheStreetSweeper would like investors to do.
Since the beginning of the year, JAMN has miraculously risen from the ashes of the “Grey Market” graveyard to become one of the liveliest – and richest – stocks in the entire microcap arena. JAMN has seen its stock shoot straight toward heaven, soaring from 55 cents to peak above $6 a share on massive daily volume, with its market value nowtopping $355 million despite the company’s limited resources and operating history. (As covered in more detail below, two of the Internet tout sheets pushing JAMN the hardest effectively vanished -- disabled by their Internet servers -- on the day the stock’s trading volume exploded past 20 million shares.)
CCME: Few Signs of Life at 'Healthy' Chinese Firm
by Roddy Boyd, 3/23/2011 9:30:34 AM
Also, and this cannot be understated, hanging out on a sidewalk in Fujian–the sidewalks double as parking spots when the streets, which appeared to have been designed in the Han Dynasty, fill up–was not a viable option. There was also the matter of the world-class headache the Financial Investigator was developing from Fuzhou’s diabolical smell, an epic conflation of poor sewage treatment, air pollution and the smell of cabbage that made getting the hell off Dongjie street a matter of vital importance.
The Financial Investigator and his traveling companion for the trip, an American investor with extensive experience in China, decided to head upstairs despite our interview with the CFO having been cancelled at the last minute (with no explanation given.) We thought a quick tour of the offices and meeting a few other executives might open our eyes to a few things.
Though the language barrier was a little steep with the young receptionist–when we asked for writing paper, she provided Kleenex–we were in short order shown to their conference room and told to wait. It did not escape notice that pride of place in the conference room belonged to a framed certificate of participation from the Fall 2010 Rodman & Renshaw conference, the World Cup for reverse merger companies and the pumpers and touts who peddle them.
Eventually chief operating officer James Yu came down and after spending 30 minutes trying to understand who we were, concluded that giving us a tour wouldn’t hurt. Soon enough, his colleague, Vinne Ye–the chairman’s assistant–came out and took us around.
It was most eye-opening.more...
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