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Company name bebe stores, inc.
Stock ticker BEBE
Live stock price [stckqut]BEBE[/stckqut]
P/E compared to competitors Fair
MANAGEMENT EXECUTION
Employee productivity Poor
Sales growth Poor
EPS growth Poor
P/E growth Poor
EBIT growth Poor
ANALYSIS
Confident Investor Rating Poor
Target stock price (TWCA growth scenario) $0.52
Target stock price (averages with growth) $1.5
Target stock price (averages with no growth) $2.28
Target stock price (manual assumptions) $15.36

The following company description is from Google Finance: http://www.google.com/finance?q=bebe

bebe stores, inc. designs, develops and produces a line of contemporary women’s apparel and accessories. The Company?s product offering includes a range of separates, tops, dresses, active wear and accessories in the lifestyle categories, such as career, evening, casual and active. It designs and develops the majority of its merchandise in-house, which is manufactured to the Company?s specifications, or is sourced directly from third-party manufacturers. As of July 3, 2010, the Company marketed its products under the bebe, BEBE SPORT, bbsp, PH8 and 2b bebe brand names through its 297 retail stores, its online store at www.bebe.com, and its 49 international licensee operated stores. As of September 2010, the Company?s store operations were organized into four regions and 32 districts.

Confident Investor comments: I realize that the stock price of this company has done quite well over the past year and that many analysts have a very nice growth target on this company. At this price and at this time, I do not think that a Confident Investor can confidently invest in this stock.

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Company name Atlas Pipeline Partners, L.P.
Stock ticker APL
Live stock price [stckqut]APL[/stckqut]
P/E compared to competitors Good
MANAGEMENT EXECUTION
Employee productivity Good
Sales growth Good
EPS growth Good
P/E growth Good
EBIT growth Good
ANALYSIS
Confident Investor Rating Good
Target stock price (TWCA growth scenario) $49.92
Target stock price (averages with growth) $33.98
Target stock price (averages with no growth) $13.35
Target stock price (manual assumptions) $50.2

The following company description is from Google Finance: http://www.google.com/finance?q=apl

Atlas Pipeline Partners, L.P. (the Partnership) is a provider of natural gas gathering, processing and treating services in the Anadarko and Permian Basins located in the southwestern and mid-continent regions of the United States and a provider of natural gas gathering services in the Appalachian Basin in the northeastern region of the United States. The Company conducts its business in the midstream segment of the natural gas industry through two segments: Mid-Continent and Appalachia. The Partnership?s operations are conducted through subsidiary entities whose interests are owned by Atlas Pipeline Operating Partnership, L.P. (the Operating Partnership), a wholly owned subsidiary of the Partnership. Its partner, Atlas Pipeline Partners GP, LLC (the General Partner), manages its operations and activities through its ownership of its general partner interest.

Confident Investor comments: At this price and at this time, I think that a Confident Investor can confidently invest in this stock.

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Company name South Jersey Industries
Stock ticker SJI
Live stock price [stckqut]SJI[/stckqut]
P/E compared to competitors Fair
MANAGEMENT EXECUTION
Employee productivity Fair
Sales growth Poor
EPS growth Good
P/E growth Poor
EBIT growth Fair
ANALYSIS
Confident Investor Rating Poor
Target stock price (TWCA growth scenario) $50.24
Target stock price (averages with growth) $46.45
Target stock price (averages with no growth) $38.92
Target stock price (manual assumptions) $50.21

The following company description is from Google Finance: http://www.google.com/finance?q=sji

South Jersey Industries, Inc. (SJI) is an energy services holding company that provides energy related products and services through its subsidiaries, South Jersey Gas Company (SJG), South Jersey Resources Group, LLC (SJRG), Marina Energy, LLC (Marina), South Jersey Energy Company (SJE) and South Jersey Energy Service Plus, LLC (SJESP). SJG is a regulated natural gas utility. SJG distributes natural gas in the seven southernmost counties of New Jersey. SJRG markets wholesale natural gas storage, commodity and transportation in the mid-Atlantic and southern states. Marina develops and operates onsite energy-related projects. SJE acquires and markets natural gas and electricity to retail end users and provides total energy management services to commercial and industrial customers. SJESP provides residential and light commercial service and installation of heating, ventilation, and air conditioning (HVAC) systems, plumbing services, and appliance repair and service/maintenance contracts.

Confident Investor comments: At this price and at this time, I do not think that a Confident Investor can confidently invest in this stock.

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Company name RightNow Technologies
Stock ticker RNOW
Live stock price [stckqut]RNOW[/stckqut]
P/E compared to competitors Good
MANAGEMENT EXECUTION
Employee productivity Poor
Sales growth Good
EPS growth Good
P/E growth Poor
EBIT growth Poor
ANALYSIS
Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $47.08
Target stock price (averages with growth) $52.04
Target stock price (averages with no growth) $23.64
Target stock price (manual assumptions) $47.6

The following company description is from Google Finance: http://www.google.com/finance?q=rnow

RightNow Technologies, Inc. (RightNow) provides RightNow CX, an on-demand (cloud-based) suite of software and services. RightNow?s technology enables an organization’s service, marketing and sales personnel to leverage a common application platform to deliver service, to market and to sell via the phone, e-mail, Web, chat and social interactions. The Company?s Professional Services group combines project management (RightNow Project Methodology) with technical and business-focused consulting services to its clients. On September 15, 2009, the Company acquired HiveLive, Inc. (HiveLive). HiveLive is an enterprise-class social platform provider with a platform for customer support, engagement and loyalty, and ideation communities.

Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in this stock as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns.

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I typically do not try to over-interpret the business practices of my investments.  As the co-owner of the company (i.e. a stockholder), I have hired a qualified board to oversee my interests and make sure the day to day managers of the company are executing well.  However, every once in a while I have to question the management decisions of one of my investments.  In this case, it is Netflix (NFLX) [stckqut]nflx[/stckqut].

Netflix just announced a fairly major rate hike on its various subscription packages.  In some cases, that rate hike was as much as 60%. While this may bump up the short-term revenues for the company, it is also possible that some people will choose a cheaper package or choose a new source for video entertainment. That would result in Netflix dropping revenue.

Some investment advisers speak of a “moat” around your company – I don’t believe that such a moat exists for most companies. Netflix grew  by jumping the “moat” of the traditional video stores like Blockbuster back when that moat was the presence of a great network of brightly lit stores with a lot of stock. Now those stores are empty or turned into Chinese restaurants or clothing resell stores. Most “moats” in the 21st century are more analogous to drainage ditches that are easily crossed by a determined competitor. Therefore, as an investor, we must be ready to always escape out the back of the castle of our investment if the moat looks like it is going to be breached.

It is important for investors to not get too jumpy though. Remember, we hire good managers at the companies that we have invested in too carefully make these decisions. There may be very solid reasons for Netflix to change its pricing and force people into new subscription packages or pay more for their existing package. The Netflix contract with Starz for much of their streaming revenue is about a year from renewal and this may be a way to control some of those costs. They just did a streaming deal with NBCUniversal and perhaps that content justified an enhanced subscription model at this time. It also may be a way to control the costs of DVD distribution. If we trust our managers, then our concerns about their pricing model (or anything else in the daily running of the business) should be qualified. The reality is that we don’t work there and we don’t think about these issues all day long.

It is relevant though to be a little concern when there are various pages on Facebook now protesting the change. The good news for Netflix, at the time of this writing none of these pages have gone especially viral and are still under about 10,000 likes for each page that I found. Even the “1,000,000 people who will not stand for Netflix’s new prices” page is currently at an extremely small percentage of that goal. However, the power of the social network is always a concern and if these pages catch on there could be some affect on revenues.

The other good news is that Piper Jaffray just raised its target for NFLX to $330 (about 10% above current price which closed yesterday just shy of $299).  When I last reviewed the stock back in April I said that it was probably a good buy until $297. I am not ready to re-review NFLX but if I did, my back of the envelope calculation puts me above PJC’s target. There is some confidence that comes from a company that is up about 20% from 3 months ago, about 35% from 6 months ago, and approximately 60% from a year ago.

So is NFLX at risk?  Maybe, but don’t panic yet. The technicals on the company are still very good. They have really good managers that have put the stock where it is today, we should probably trust them that they know what they are doing. However, the next quarterly report and annual report from the company will give us a good clue if the new pricing is hurting their subscription rate. Also, the popularity of the pages on Facebook will be an early indicator of risk. There are companies that are trying to attack Netflix (e.g. Apple and Amazon) but maybe the walls of the Netflix castle are strong even if the moat is not that deep.