Decreased comfort level

[philipcarl3]

"Kudos to you for having the time to reach out to upper management of every company you invest in.". Did I say I contact "every" company I invest in? No, I didnt. There you go miss characterizing again.
I did contact mgmt this time because a few sketchy authors posted some info that made me skeptical of their thoroughness so I decided to contact the company for their side of it.

You have time to search out and read secondary "sources" (and consider them reliable?) and read transcripts but don't have a few minutes to type out an email or two to see what management says to your specific question(s)? So why do find it valuable time spent reading transcripts but reading emails from management is not worth your time? It's the same source.

[0751Jeff]

Philip, I might contact IR if I weren't scared to death by all the negatives I already see here. If I were on the fence, then sure, contacting IR would be a good idea. I'm not on the fence. Therefore, I'm not going to waste my or their time.

I wish you the best of luck with your investment. Try not to take it so personally when someone isn't as all-in on your investments as you are. There are plenty of other investors who have done great research who think the companies I'm invested in are junk. Nobody knows who's right until time has told the tale, and there's no reason to get offended because someone sees things differently than you. I admire your passion, though.

[admin]

Philip, I might contact IR if I weren't scared to death by all the negatives I already see here. If I were on the fence, then sure, contacting IR would be a good idea. I'm not on the fence. Therefore, I'm not going to waste my or their time.

I wish you the best of luck with your investment. Try not to take it so personally when someone isn't as all-in on your investments as you are. There are plenty of other investors who have done great research who think the companies I'm invested in are junk. Nobody knows who's right until time has told the tale, and there's no reason to get offended because someone sees things differently than you. I admire your passion, though.

Wise words, Jeff. We're still long, albeit with half of the initial SHU position as we have some doubt emerging about the divergence in evolution between backlog and revenue. No doubt this is an industry that has tremendous prospects though and the company did grow 101% organically last year with existing customers also buying a lot more which is a positive sign.

To Philip, perhaps you know more about this company than either of us but try not to take it personally when someone isn't immediately taken with your choice investments, it's what makes a market.

[philipcarl3]

I didn't take anything personally, I was just calling out someone who didn't do their homework yet was pretending they did.

[0751Jeff]

LOL. Some people, it doesn't matter how hard you try to give them a gracious out, they insist on making an ass of themselves.

So admin (what's your name, BTW?), how do you reconcile the CFO's history? I can see arguing away the sketchy clients -- larger-scale clients may not want their names used in promotional releases. As far as the numbers, I mean, it's a story of exploding growth, right? So having all the numbers perfectly sync on every management statement may not be that important when even the lowest of those numbers looks really good. But having the chief financial officer fresh off a financial scandal just four years ago? That's the part I can't get past to make myself pull the trigger on this. Why would a legitimate business want to have that kind of stigma surrounding its topmost levels of leadership? What does this guy offer that makes him worth that kind of risk?

[philipcarl3]

Jeff, what exactly is your understanding of this "scandal"? It seems you are speaking as if you have all the facts straight on this. Is that right? You confident on that?  Based on what? Did you check with TEUM management ? Have you read all the relevant legal filings? or are you just basing your assessment on what you are reading from sketchy Seeking Alpha authors and what you read here from anonymous sources? You keep talking out of your ass. You're the one making yourself look like a gullible fool.

[admin]

Jeff, there were three issues which reduced my enthusiasm for the company:

• Dodgy customers (which has mostly cleared up, at least for me).
  
• A curious and really substantial divergence between revenue guidance and backlog. This is something which needs to be cleared up, but on the other hand, if the company didn't publish backlog figures, there wouldn't be any problem.
  
• The CFO history doesn't help when there were serious doubts about their customers, but now I'm not losing that much sleep over it, although it remains a bit of a red flag and I can imagine others, like yourself, having bigger problems with it. I also admit I don't know all the details of the fraud case of that previous company but as far as I understood it he wasn't the instigator.
  

[philipcarl3]

Hey Jeff/Admin, I see it was reported recently that Perkins Capital Management increased the number of shares they own in Q1 from 969k to 1.34 million. They aren't a big name, but I'm sure  they are careful with their customer's money just the same. If only they had done their DD like you guys and  read those Seeking Alpha articles written by nobody's or anonymous posters here, huh? Maybe they would saved themselves millions of dollars by taking into consideration their exhaustive research? (Sarcasm). I guess "that's what makes a market", huh? Plenty of room for all levels of investors...smart ones and dumb ones.

[0751Jeff]

The CFO history doesn't help when there were serious doubts about their customers.

That was my thought exactly -- those two things together don't look good. But really, the crux of it comes down to the trustworthiness of the CFO. If he's trustworthy, then the dodgy clients aren't nearly as big a red flag.

You said the dodgy client issue is mostly cleared up for you. Do you have new information, or have you simply decided after considering all the information available that you're not concerned about it?

as far as I understood it he wasn't the instigator

Could you explain this, or refer me to your source (presumably a more comprehensive source than the one in the OP)?

[0751Jeff]

I should add, one issue you didn't bring up in the OP but that matters to me is this short-lived blockchain endeavor they had in late 2017 that briefly caused SP to skyrocket. Now, I paid close attention to all the blockchain schemes that popped up at that time. It was something of a running joke for me and some fellow investor friends of mine. There seemed to be one or two every week, and invariably the stock would skyrocket, only to then, in almost every case, plummet back down to earth shortly thereafter when old investors dumped their shares at inflated values and new investors realized whatever blockchain endeavor was being undertaken was either a sham or of very little value to the overall value of the company. It was pretty clear at the time that many failing companies were making these blockchain announcements as a type of pump-and-dump scheme, and the SEC launched investigations into several on that basis.

So here with TEUM we have a company that at that time was very much unknown to investors, SP was at all-time lows, and current management had just taken over the year before, and what do they do? Announce a blockchain undertaking, see SP briefly skyrocket, and then announce the blockchain endeavor did not pan out. After seeing the way these companies exploiting the blockchain frenzy back then, it makes me very leery now of investing in such a company, because who knows what the next big news item will be that later on turns out not to be as initially advertised? Not saying that's what they're doing now; just saying it makes me very leery.