Log In

OPEN: Closing Out OPEN Short Idea With a (-19.7%) Loss, Alpha Generation of +48.7%

June 13th, 2014

It would be easy for us to simply dismiss PCLN’s proposed acquisition of OPEN for $103/share as an irrational bid and nothing more than another chilling sign of Internet bubble 2.0, but in no way would that approach improve our...

READ MORE >

MCRS and OPEN: Market Share Losses and Cannibalization of TAM Are Accelerating

May 21st, 2014

Yesterday we had the opportunity to tour the floor at the National Restaurant Association’s 2014 annual conference.  We wanted to pass along some key observations from our time in the exhibit hall.  As you might imagine given our...

READ MORE >

OPEN: Deceleration in Cover Volume and Continued Restaurant Share Losses Pose Problems

May 2nd, 2014

In what surely has become an alarming trend for bulls on the stock, OPEN MISSED consensus revenue expectations for the fourth time in five quarters.  We cannot think of another situation where a growth company so consistently fell...

READ MORE >

OPEN: As Customer Acquisition Costs Sky-Rocket and Competition Gains Momentum Investors Are Left To Ask: If Not Now,...

February 7th, 2014

Approximately three months ago we postulated that OPEN’s EPS in FY14 could actually be flat on a YOY basis. At that time, and at every point up until the company’s earnings release yesterday...

READ MORE >

OPEN: As Opentable Loses Market Share in North America the Potential for a Minneapolis 2.0 Scenario Should Concern...

December 20th, 2013

As we approach year end it seems like a natural process for most investors to evaluate what they got right and what they were wrong about over the past 12-months.  We are no different.  While...

READ MORE >

OPEN: A One Legged Growth Stool Increasingly Vulnerable to Competitive Threats

November 6th, 2013

North American diners seated per restaurant is for OPEN shareholders “the one metric to rule them all” as far as stock price action is concerned.  In 2012 when diners seated per restaurant in North America slowed, OPEN shares struggled...

READ MORE >

OPEN: Hope Increasingly Creeping Into the Bull Case

August 1st, 2013

In another market environment things might be different.  Marking the fifth time in the past three years, OPEN missed consensus revenue expectations for 2Q13.  On top of that, the company lowered guidance for FY13 substantially.  Panic? Not exactly.  Had the...

READ MORE >

OPEN: Acquisition of Rezbook - OPEN Dominance or More IACI Incompetence? Probably a Bit of Both, Margin Impact Could be...

August 1st, 2013

In what can only be described as a surprise to the marketplace, OPEN announced that it had reached an agreement to acquire IACI’s Rezbook. As part of the deal Urbanspoon, a leading mobile...

READ MORE >

OPEN: YELP’s Acquisition of SeatMe Could Herald the Start of a New Era in the North American ERB Space

July 19th, 2013

And so it begins….Two and a half years ago we introduced OPEN as a short idea predicated on four principal tenets: At its core, OPEN provides a “solution without a problem”.  OPEN’s ERB technology and...

READ MORE >

MCRS and OPEN: Thoughts From the NRA Show 2013 – Tablet POS Systems Continue to Come of Age as Competitive Headwinds...

May 21st, 2013

Yesterday we had the opportunity to tour the floor at the National Restaurant Association’s 2013 annual conference.  We wanted to pass along some key observations from our time in the exhibit...

READ MORE >

OPEN: As Sales Force Productivity Collapses a Few Critical Questions to Ponder; 10-Q Highlights and Observations

May 7th, 2013

Seriously, who wouldn’t love this business?  In 4Q12, OPEN’s growth in diners seated per restaurant collapsed, but the company had healthy net additions in restaurant clients, stability in NA cover...

READ MORE >

OPEN: Four Reasons Why OPEN’s Profitability Prospects in Europe Remain Grim

May 2nd, 2013

A few weeks ago we published a lengthy report which outlined some of the more troubling competitive developments for OPEN in North America. We maintain our view that the company is on the cusp of a major deceleration in many of its key...

READ MORE >

OPEN: As Competitive Undercurrents Take Hold in North America When Will Investors Start to Take Notice?

April 12th, 2013

It’s true, OPEN shares are up 55.6% over the past 12-months with the stock witnessing gains of nearly 22% in the past 3-months alone.  The short interest, which once represented close to 50% of the float has now...

READ MORE >

OPEN: Growth Is Grinding To a Halt…. And TopTable Isn’t Going to Save the Day

February 8th, 2013

Well at least they didn’t miss consensus revenue estimates again….  Seriously though, do you remember the “good old days” when supposed growth companies that reported a massive deceleration in operating metrics, low quality...

READ MORE >

Proprietary Restaurant Checks Suggest Challenges Could Mount for OPEN and MCRS in 2013; Other Key Observations

January 22nd, 2013

Over the past month, PAA Research conducted a survey of approximately 80-85 restaurant operators a significant percentage of which are clients of OPEN and MCRS. The general purpose of the survey was to gain...

READ MORE >

OPEN: After Another Ho-Hum Quarter, the Six Lingering Questions We’re Thinking About

November 2nd, 2012

Heading into the company’s 3Q12 earnings release, OPEN shares had rallied 31.8% over the past 3-months compared to a meager 3.4% gain for the Nasdaq.  Clearly investor enthusiasm for OPEN shares continued to increase over the past...

READ MORE >

OPEN: Another OPEX Driven Beat Aside, the Signposts of Growth Maturation and Competitive Pressures Continue to Pile Up

August 3rd, 2012

With OPEN shares down 24% in the past month and now trading at what some might think is an attractive 18.7x consensus EPS for 2013 we shouldn’t be completely surprised by the strength in the stock...

READ MORE >

OPEN: This is Not a “Blocking and Tackling” Exercise

June 12th, 2012

If you were to listen solely to OPEN management, the company’s path to market dominance in the online restaurant reservation space is merely an exercise in “blocking and tackling”.  Management continues to execute on the same strategy the company had in...

READ MORE >

OPEN: As Growth Metrics Collapse Investors Are Left to Wonder: Where is the Vision?

May 2nd, 2012

Was it really just only 12-months ago that OPEN was the darling of Wall Street?  It seems like another lifetime.  Approximately one year ago to the day, OPEN reported another quarter of 40%+ YOY organic revenue growth and handily...

READ MORE >

OPEN: When Did This Become a Cost-Cutting Story? Peak EPS Could Be Closer Than You Think

February 8th, 2012

At the highest level here are the headlines about OPEN’s 4Q11 earnings results and subsequent earnings conference call: 1) the company delivered a low quality beat, 2) underlying operating metrics for the most part were...

READ MORE >

OPEN: Stock Rips As the Company Loses Share in Euro., Faces Increased Competition in the US, 4Q11 Should Show More Sign...

February 7th, 2012

Stop us if you’ve heard this one before: a heavily shorted stock, which was one of the worst performing names in its sector in 2011 has now rallied more than 20% to start the year.  Of course in...

READ MORE >

OPEN: The Growth Story Unravels Just As Competition Appears Poised to Step Up, Lowering Price Objective to $30

November 2nd, 2011

In the lengthy report we published on OPEN on Monday (backed by a survey of 110-120 restaurant owners) we outlined a number key issues that we expected to become discounted in the stock over the next...

READ MORE >

OPEN: The NA Moat Is More Vulnerable Than You Think – A More Realistic TAM Analysis, Lowering Price Objective to $37

October 31st, 2011

In the 7+ months since we introduced OPEN as a short idea, we have been in a position where the stock has gained more than 40% against us and now trades more than 40% below where we initiated our...

READ MORE >

OPEN: The North American “Moat” Looks to be Increasingly Under Siege

September 8th, 2011

OPEN shares traded off sharply today in response to GOOG’s announcement that it had acquired Zagat, a worldwide publisher of ratings and reviews of restaurants and other businesses.  The Zagat restaurant surveys, launched more than 30 years...

READ MORE >

OPEN: The Growth Story Is Cracking Sooner Than Expected, Lowering Price Objective to $48

August 2nd, 2011

Approximately 5-months ago, we introduced OPEN as a short idea based on the following thesis: 1. OPEN’s electronic reservation booking system (ERB) in many respects is a solution without a problem 2. Restaurants view the...

READ MORE >

OPEN: 2Q11 Preview, Competition Matters

August 1st, 2011

If you happen to be looking at OPEN for the first time, you might be wondering: what’s the big deal about the stock from a pure performance perspective?  Year-to date the stock has gained a measly 0.5%, compared to a 2.8% gain for the S&P 500.  Obviously, OPEN has been...

READ MORE >

OPEN: Competition Continues to Eat Away at OPEN’s Total Addressable Market (TAM)

June 24th, 2011

Approximately 12-weeks ago, we introduced OPEN as a short idea.  You can read our original 40-page report by clicking here.  The principal elements of our short thesis are as follows: 1. OPEN’s electronic reservation booking system...

READ MORE >

OPEN: Unassailable OPEN? We Don’t Think So, 1Q11 Preview

May 3rd, 2011

Approximately 8-weeks ago, we introduced OPEN as a short idea.  You can read our original 40-page report by clicking here.  The principal elements of our short thesis are as follows: 1. OPEN’s electronic reservation booking system (ERB) in many respects...

READ MORE >

OPEN: Evaluating OPEN’s Competitive Challenges in Europe – Is Market Leadership in Europe “Fait Accompli”?

March 17th, 2011

Approximately 2-weeks ago, we introduced OPEN as a short idea.  You can read our original 40-page report by clicking here.  The principal elements of our short thesis are as follows: 1. OPEN’s...

READ MORE >

OPEN: The “TAM” Fallacy and the Implications of a Solution without a Problem – Time to Get Short

March 2nd, 2011

Let’s get this out of the way early on – we are firm believers in the concept that valuation is not a short thesis, or more simply stated valuation is not a thesis.  Ask any hedge fund manager who has relied on...

READ MORE >

Current Ideas

CTC

SHORT

$101

ATGE

SHORT

$15

AYI

SHORT

$108

HCG.TO

SHORT

$0

RON.TO

SHORT

$9

BIG

SHORT

$28

ESI

SHORT

$0

BGG

PAIR - LONG BGG/SHORT TTC

25%

TTC

PAIR - LONG BGG/SHORT TTC

25%

Z

SHORT

$14.00

NA.TO

SHORT

$22

ING.PA

SHORT

$35

ZU

SHORT

$15

TRLA

SHORT

$20

MCRS

SHORT

$31

APOL

SHORT

$35

OPEN

SHORT

$30

BCO

LONG

$35

WWE

LONG

$25

KNL

PAIR - LONG KNL/SHORT MLHR

25%

XOXO

LONG

$20

CSGP

SHORT

$100

GCA

LONG

$8

IPSU

LONG

$20

MLHR

SHORT

$22

ARC

LONG

$12.50

LOOP

PAIR - LONG CSGP/SHORT LOOP

40%

THQI

LONG

$35

WPO

SHORT

$275

COCO

SHORT

$0

HNI

SIG

RGR