There's nothing I love more than a low-float stock with promoters pumping it like a deflated tire. So, what exactly makes 1847 Holdings LLC (AMEX: EFSH) special? Because it's one of the few companies that I've covered to turn a profit. Granted, that was last year. However, there's good reason to believe management could do it again and more consistently. This isn't some fly-by-night business, either. 1847 is a holding company that owns several established businesses. Between the 60% annual revenue growth that's just shy of $50 million and dividends paid out over the last two years (yes, actual return to shareholders), EFSH could be one of the few stocks to make it out of the penny stock paradigm. 1847 Holdings LLC (AMEX: EFSH) 1-month trading range: $0.215 - $0.443 Typical average daily volume: 3.26K Float: ~ 3.07 million 1847 Holdings LLC Like the name implies, 1847 is a holding company. They buy up small businesses with less than $50 million in revenues. Their model works as follows: 
Source: EFSH Investor Presentation It's basically: - Buy a stable, mature business at a discount
- Make them even more profitable and grow revenues
- Sell the business for $$
To date, they've scooped up seven companies, two of which they spun off. Their current holdings include the following companies: - Asien's Appliance: Specialty retailer with a diverse selection of appliances available, including refrigerators, washers, dryers, dishwashers, ovens, ranges, cooktops, microwaves, freezers, ice makers, and wine coolers.
- Kyle's Custom Wood Shop: Specializes in crafting custom cabinets for residential and commercial clients. Their expertise lies in creating unique designs tailored to individual preferences.
- Wolo Manufacturing Corp: Manufactures and distributes f automotive horns and accessories from air horns, electric horns, musical horns, novelty horns, marine horns, and industrial horns.
- ICU Eyewear: Offers reading glasses, sunglasses, blue light glasses, bifocal sunglasses, polarized sunglasses, and more to retail customers.
- High Mountain Door & Trim: Custom door and trim company catering to residential and commercial clients.
- Innovative Cabinets & Design: Specializes in custom cabinetry for various spaces such as kitchens, bathrooms, closets, offices, and entertainment centers. Their expertise lies in designing and constructing tailored cabinets to meet individual needs.
Their website lists Goedeker's, a small appliance dealer out of St. Louis, in which EFSH sold off most of its stake in July 2020 through an NYSE IPO for $9.5 million, a nice gain for its $6.2 million initial investment. Neese, a business services company for agricultural, was acquired by EFSH in 2017 for $2.2 million in cash and $2.9 million in promissory notes. Management took a bath on this one when they sold it for $0.33 million in 2021. Financials 
Source: Stockanalysis.com Since reporting started in 2016, EFSH has always reported a gross profit. In 2021, they came extremely close to generating positive operating income for the entire year. In fact, the company did generate positive cash from operations in 2020 to the tune of $3.9 million. Currently, they burn $5.4 million per year. The biggest challenge is the company's debt load. They hold $36 million in total debt and $2.6 million in cash. $27.3 million of that debt was issued in 2021. In the last year or so, they've chosen to issue more stock, some of which is restricted. Promoter Activity Two promoters hit me up about EFSH starting back on July 13. One was paid $15,000 for a campaign from July 13-14, while the other got $17,500 for the same period. The second promoter's total compensation from all its campaigns for EFSH was $67,500. So, what did EFSH get for their money? Both highlighted the obvious points: low float, revenue growth, etc. And both hit on the recent order (April 14) for ICU Eyewear with a local supermarket chain for $260,000. Beyond that, both did a decent job of explaining who the company is and what they do. The more seasoned (and better-paid) promoter also spent some verbiage on the RSI and Stochastics, which, as most of you know, aren't worth the pixels they're printed on since they change by the time you read the promo. I did also find it amusing that both highlighted quality management. That's a bit rich considering how much they lost on their Neese deal a few years ago. Straight to the Facts Other than the potentiality for profit, most of this sounds par for the course. But I saved the best for last. 
The second day the promoters turned on the spigot, volume and price surged. I'm talking about a 33% jump, which I can't help but tie to their activity. THIS IS WHAT I LIVE FOR! Of course price fell away by the end by the close. But if you had paid attention to what these guys were pushing, then you had a leg up on a potentially lucrative trade. The good news is we know EFSH has paid for promotions before this one. So chances are, they'll do it again. Always at your service, Baron Von Stocks | 
Post a Comment
Post a Comment