Announcement • Dec 22
Patriot Transportation Holding, Inc.(NasdaqGS:PATI) dropped from NASDAQ Transportation Index Patriot Transportation Holding, Inc. has been dropped from NASDAQ Transportation Index. Announcement • Nov 02
Blue Horizon Partners, Inc. entered into an agreement to acquire Patriot Transportation Holding, Inc. (NasdaqGS:PATI) Blue Horizon Partners, Inc. entered into an agreement to acquire Patriot Transportation Holding, Inc. (NasdaqGS:PATI) on November 1, 2023. United Petroleum Transports, Inc. will acquire all of the outstanding shares of Patriot common stock for $16.26 per share in cash. The transaction values Patriot Transportation at approximately $65.9 million, including assumed cash and debt. UPT has obtained a customary financing commitment from an established lending institution pursuant to which the lender will provide financing that, together with other available sources, is expected to be sufficient to fund the merger consideration and other obligations under the merger agreement. Patriot will become a private company and delist from the NASDAQ Global Select Market. In case of certain condition, Patriot Transportation will pay Blue Horizon a termination fee of $1.86 million. However, the Patriot termination fee is reduced to $0.93 million if (i) the merger agreement is terminated prior to the No-Shop Period Start Date by the Patriot to accept a Superior Proposal, (ii) the merger agreement is terminated prior to the No-Shop period start date by the Blue Horizon following a Patriot Board Recommendation Change, or (iii) the merger agreement is terminated by either the Patriot or Blue Horizon and the Patriot consummates a transaction within twelve months of the termination of the merger agreement and such transaction is the result of a publicly disclosed acquisition proposal which meets certain requirements set forth in the merger agreement. The merger agreement also provides that, in certain circumstances, including the termination of the merger agreement by the Patriot due to Blue Horizon breach of the merger agreement or failure to obtain Debt Financing in accordance with the terms of the merger agreement, Blue Horizon would be required to pay the Patriot Transportation a termination fee of $1.86 million.
The definitive merger agreement includes a 30-day “go-shop” period that will expire on December 1, 2023, which permits Patriot and its representatives to actively solicit and consider alternative acquisition proposals. The transaction has been unanimously approved by Patriot’s and Horizon Partners Board of Directors, is subject to the satisfaction of other customary closing conditions, including the approval of Patriot’s shareholders, ability to obtain Debt Financing. The transaction is expected to close by early 2024.
Cassel Salpeter & Co., LLC acted as financial advisor and fairness opinion provider and Gardner Davis and John Wolfel of Foley & Lardner LLP acted as legal counsel for Patriot. Stephens Inc. acted as financial advisor and Mark Scudder and Heidi Hornung-Scherr of Scudder Law Firm, P.C., L.L.O. acted as legal counsel for Blue Horizon. New Risk • Nov 02
New major risk - Share price stability The company's share price has been highly volatile over the past 3 months. It is more volatile than 90% of American stocks, typically moving 5.7% a week. This is considered a major risk. Share price volatility increases the risk of potential losses in the short-term as the stock tends to have larger drops in price more frequently than other stocks. It may also indicate the stock is highly sensitive to market conditions or economic conditions rather than being sensitive to its own business performance, which may also be inconsistent. Currently, the following risks have been identified for the company: Major Risks Share price has been highly volatile over the past 3 months (5.7% average weekly change). High level of non-cash earnings (28% accrual ratio). Minor Risks Profit margins are more than 30% lower than last year (2.8% net profit margin). Market cap is less than US$100m (US$27.1m market cap). Valuation Update With 7 Day Price Move • Nov 01
Investor sentiment improves as stock rises 101% After last week's 101% share price gain to US$15.60, the stock trades at a trailing P/E ratio of 21x. Average trailing P/E is 16x in the Transportation industry in the US. Total returns to shareholders of 193% over the past three years. Buying Opportunity • Aug 11
Now 20% undervalued after recent price drop Over the last 90 days, the stock is down 5.5%. The fair value is estimated to be US$11.36, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has been flat over the last 3 years. Meanwhile, the company has become profitable. New Risk • Aug 05
New major risk - Earnings quality The company has a high level of non-cash earnings. Accrual ratio: 28% This is considered a major risk. Non-cash earnings can arise from many different things. However, if a company consistently has a high level of non-cash earnings, it may be a sign that they are recognizing revenue from customers before the full value of the sales are received as cash or they are not depreciating the value of their assets appropriately. These are practices that inflate earnings, while not providing a similar increase to cash flows. Companies in some select industries naturally have a high level of non-cash earnings and it is not a major concern. However, in the worst case scenario it can be an early sign of performance manipulation by management. Currently, the following risks have been identified for the company: Major Risk High level of non-cash earnings (28% accrual ratio). Minor Risks Profit margins are more than 30% lower than last year (2.8% net profit margin). Market cap is less than US$100m (US$31.2m market cap). Reported Earnings • Aug 04
Third quarter 2023 earnings released: EPS: US$0.34 (vs US$0.22 in 3Q 2022) Third quarter 2023 results: EPS: US$0.34 (up from US$0.22 in 3Q 2022). Revenue: US$24.3m (up 3.2% from 3Q 2022). Net income: US$1.19m (up 54% from 3Q 2022). Profit margin: 4.9% (up from 3.3% in 3Q 2022). Over the last 3 years on average, earnings per share has increased by 48% per year but the company’s share price has fallen by 1% per year, which means it is significantly lagging earnings. Announcement • Jul 28
Patriot Transportation Holding, Inc. to Report Q3, 2023 Results on Aug 03, 2023 Patriot Transportation Holding, Inc. announced that they will report Q3, 2023 results on Aug 03, 2023 Reported Earnings • May 10
Second quarter 2023 earnings released: EPS: US$0.14 (vs US$0.14 loss in 2Q 2022) Second quarter 2023 results: EPS: US$0.14 (up from US$0.14 loss in 2Q 2022). Revenue: US$23.5m (up 12% from 2Q 2022). Net income: US$475.0k (up US$965.0k from 2Q 2022). Profit margin: 2.0% (up from net loss in 2Q 2022). Over the last 3 years on average, earnings per share has increased by 68% per year but the company’s share price has only increased by 3% per year, which means it is significantly lagging earnings growth. Reported Earnings • Feb 05
First quarter 2023 earnings released: EPS: US$0.14 (vs US$1.88 in 1Q 2022) First quarter 2023 results: EPS: US$0.14 (down from US$1.88 in 1Q 2022). Revenue: US$22.9m (up 11% from 1Q 2022). Net income: US$485.0k (down 93% from 1Q 2022). Profit margin: 2.1% (down from 31% in 1Q 2022). Over the last 3 years on average, earnings per share has increased by 85% per year but the company’s share price has fallen by 15% per year, which means it is significantly lagging earnings. Announcement • Jan 27
Patriot Transportation Holding, Inc. to Report Q1, 2023 Results on Feb 02, 2023 Patriot Transportation Holding, Inc. announced that they will report Q1, 2023 results on Feb 02, 2023 Announcement • Dec 11
Patriot Transportation Holding, Inc. Appoints Eric K. Mann to the Board of Directors On December 6, 2022, Patriot Transportation Holding, Inc.’s board of directors, upon the recommendation of the nominating and corporate governance committee, appointed Eric K. Mann to the board of directors. Eric Mann will serve as a member of the Audit, Compensation, and Nominating and Corporate Governance Committees and will receive director compensation consistent with the company’s compensation arrangements for other non-employee directors. Mr. Mann has served as president and CEO of YMCA of Florida’s First Coast since 2011 and has been with the YMCA for more than 40 years. He was CEO of the Pittsburgh, Pennsylvania YMCA when he was recruited to become the first African American leader of Florida’s First Coast YMCA and as such, he also became the first African American CEO of a major metropolitan YMCA south of the Mason-Dixon Line. Mr. Mann is Chairman of the Board of the Jacksonville Civic Council (JCC) and has served on the board since 2014. Mr. Mann has also served on the board of directors of Brooks Health System since 2014 and will be the incoming Chairman of the board in 2023. Recently he served as co-chairman of JCC’s Race and Social Justice Task Force which has worked for two years to develop a community report. Mr. Mann brings to the Patriot Board his extensive business experience and brings valuable knowledge in shaping diversity, inclusion and social responsibility policies. Announcement • Dec 10
Patriot Transportation Holding, Inc., Annual General Meeting, Feb 02, 2023 Patriot Transportation Holding, Inc., Annual General Meeting, Feb 02, 2023, at 11:00 US Eastern Standard Time. Agenda: To elect the six director nominees listed in the proxy statement for a one-year term; to ratify the audit committee’s selection of the independent auditor; and to approve, on an advisory basis, the executive compensation of its named executive officers. Reported Earnings • Dec 08
Full year 2022 earnings released: EPS: US$2.08 (vs US$0.18 in FY 2021) Full year 2022 results: EPS: US$2.08 (up from US$0.18 in FY 2021). Revenue: US$87.9m (up 8.1% from FY 2021). Net income: US$7.19m (up US$6.57m from FY 2021). Profit margin: 8.2% (up from 0.8% in FY 2021). Over the last 3 years on average, earnings per share has increased by 95% per year but the company’s share price has fallen by 25% per year, which means it is significantly lagging earnings. Recent Insider Transactions Derivative • Dec 08
Chairman exercised options to buy US$139k worth of stock. On the 2nd of December, Thompson Baker exercised options to buy 17k shares at a strike price of around US$7.31, costing a total of US$126k. This transaction amounted to 28% of their direct individual holding at the time of the trade. Since March 2022, Thompson has owned 60.74k shares directly. Company insiders have collectively bought US$364k more than they sold, via options and on-market transactions, in the last 12 months. Reported Earnings • Aug 04
Third quarter 2022 earnings released: EPS: US$0.22 (vs US$0.095 in 3Q 2021) Third quarter 2022 results: EPS: US$0.22 (up from US$0.095 in 3Q 2021). Revenue: US$23.5m (up 13% from 3Q 2021). Net income: US$771.0k (up 139% from 3Q 2021). Profit margin: 3.3% (up from 1.5% in 3Q 2021). Over the last 3 years on average, earnings per share has increased by 82% per year but the company’s share price has fallen by 25% per year, which means it is significantly lagging earnings. Announcement • Jul 28
Patriot Transportation Holding, Inc. to Report Q3, 2022 Results on Aug 03, 2022 Patriot Transportation Holding, Inc. announced that they will report Q3, 2022 results at 12:30 PM, US Eastern Standard Time on Aug 03, 2022 Announcement • May 17
Patriot Transportation Holding, Inc. Announces Management Changes Patriot Transportation Holding, Inc. regrets to announced that Edward (Ted) L. Baker, a director and former Chairman of the Board of Directors of the Company, passed away on April 28, 2022. On May 10, 2022, the Company’s board of directors, upon the recommendation of the Nominating and Corporate Governance Committee, appointed John D. Baker II to fill the vacancy on the board of directors created by the passing of Ted Baker. John Baker will serve as a member of the Executive Committee and will receive director compensation consistent with the Company’s compensation arrangements for non-employee directors. John Baker has served as Chairman of Florida Rock & Tank Lines, Inc., a subsidiary of the Company, since the Company was spun-off from FRP Holdings, Inc. in 2015. John D. Baker, II is the Executive Chairman and Chief Executive Officer of FRP Holdings, Inc. From February 2008 until October 2010, he served as the President and Chief Executive Officer of Patriot Transportation Holding, Inc. Before joining Patriot, Mr. Baker was president and Chief Executive Officer of Florida Rock Industries, Inc., a leading producer of construction aggregates and related materials throughout the Southeastern and Mid-Atlantic states. Reported Earnings • May 11
Second quarter 2022 earnings: EPS and revenues miss analyst expectations Second quarter 2022 results: US$0.14 loss per share (down from US$0.14 profit in 2Q 2021). Revenue: US$20.9m (up 6.1% from 2Q 2021). Net loss: US$490.0k (down 201% from profit in 2Q 2021). Revenue missed analyst estimates by 5.6%. Earnings per share (EPS) were also behind analyst expectations. Over the last 3 years on average, earnings per share has increased by 53% per year but the company’s share price has fallen by 25% per year, which means it is significantly lagging earnings. Board Change • Apr 27
Insufficient new directors No new directors have joined the board in the last 3 years. The company's board is composed of: No new directors. 1 experienced director. 4 highly experienced directors. Independent Director Charles Hyman was the last director to join the board, commencing their role in 2016. The company’s insufficient board refreshment is considered a risk according to the Simply Wall St Risk Model. Recent Insider Transactions Derivative • Feb 22
President & CEO exercised options to buy US$72k worth of stock. On the 14th of February, Robert Sandlin exercised options to buy 9k shares at a strike price of around US$7.31, costing a total of US$63k. This transaction amounted to 51% of their direct individual holding at the time of the trade. Since September 2021, Robert's direct individual holding has increased from 10.09k shares to 16.87k. Company insiders have collectively bought US$26k more than they sold, via options and on-market transactions, in the last 12 months. Reported Earnings • Feb 03
First quarter 2022 earnings: EPS and revenues miss analyst expectations First quarter 2022 results: EPS: US$1.88 (up from US$0.066 loss in 1Q 2021). Revenue: US$20.6m (up 1.7% from 1Q 2021). Net income: US$6.44m (up US$6.66m from 1Q 2021). Profit margin: 31% (up from net loss in 1Q 2021). Revenue missed analyst estimates by 5.6%. Earnings per share (EPS) also missed analyst estimates by 130%. Over the last 3 years on average, earnings per share has increased by 16% per year but the company’s share price has fallen by 24% per year, which means it is significantly lagging earnings. Reported Earnings • Dec 04
Full year 2021 earnings: EPS and revenues miss analyst expectations Full year 2021 results: EPS: US$0.18 (up from US$0.076 in FY 2020). Revenue: US$81.3m (down 8.4% from FY 2020). Net income: US$625.0k (up 143% from FY 2020). Profit margin: 0.8% (up from 0.3% in FY 2020). Revenue missed analyst estimates by 5.6%. Earnings per share (EPS) also missed analyst estimates by 130%. Earnings per share (EPS) missed analyst estimates by 130%. Over the last 3 years on average, the company's share price growth rate has exceeded its earnings growth rate by 50 percentage points per year, which is a significant difference in performance. Valuation Update With 7 Day Price Move • Nov 17
Investor sentiment deteriorated over the past week After last week's 24% share price decline to US$10.60, the stock trades at a trailing P/E ratio of 31.8x. Average trailing P/E is 19x in the Transportation industry in the US. Total returns to shareholders of 11% over the past three years. Upcoming Dividend • Nov 09
Inaugural dividend of US$3.75 per share Eligible shareholders must have bought the stock before 16 November 2021. Payment date: 15 November 2021. The company last paid an ordinary dividend in February 2020. The average dividend yield among industry peers is 1.3%. Valuation Update With 7 Day Price Move • Oct 26
Investor sentiment improved over the past week After last week's 19% share price gain to US$13.50, the stock trades at a trailing P/E ratio of 40.5x. Average trailing P/E is 18x in the Transportation industry in the US. Total returns to shareholders of 4.6% over the past three years. Reported Earnings • Jul 31
Third quarter 2021 earnings released: EPS US$0.095 (vs US$0.17 in 3Q 2020) The company reported a soft third quarter result with weaker earnings and profit margins, although revenues improved. Third quarter 2021 results: Revenue: US$20.9m (up 9.7% from 3Q 2020). Net income: US$323.0k (down 44% from 3Q 2020). Profit margin: 1.5% (down from 3.0% in 3Q 2020). Over the last 3 years on average, the company's share price growth rate has exceeded its earnings growth rate by 59 percentage points per year, which is a significant difference in performance. Reported Earnings • May 15
Second quarter 2021 earnings released: EPS US$0.14 (vs US$0.12 loss in 2Q 2020) The company reported a decent second quarter result with improved earnings and profit margins, although revenues were weaker. Second quarter 2021 results: Revenue: US$19.7m (down 16% from 2Q 2020). Net income: US$484.0k (up US$885.0k from 2Q 2020). Profit margin: 2.5% (up from net loss in 2Q 2020). Over the last 3 years on average, the company's share price growth rate has exceeded its earnings growth rate by 65 percentage points per year, which is a significant difference in performance. Reported Earnings • Feb 05
First quarter 2021 earnings released: US$0.066 loss per share (vs US$0.14 loss in 1Q 2020) The company reported a decent first quarter result with reduced losses and improved control over expenses, although revenues were weaker. First quarter 2021 results: Revenue: US$20.2m (down 19% from 1Q 2020). Net loss: US$222.0k (loss narrowed 52% from 1Q 2020). Over the last 3 years on average, earnings per share has fallen by 82% per year but the company’s share price has only fallen by 23% per year, which means it has not declined as severely as earnings. Is New 90 Day High Low • Jan 07
New 90-day low: US$8.61 The company is down 2.0% from its price of US$8.79 on 08 October 2020. The American market is up 11% over the last 90 days, indicating the company underperformed over that time. It also underperformed the Transportation industry, which is up 15% over the same period. Upcoming Dividend • Dec 24
Upcoming Dividend of US$3.00 Per Share Will be paid on the 30th of December to those who are registered shareholders by the 31st of December. The company last paid an ordinary dividend in February 2020. The average dividend yield among industry peers is 1.4%. Announcement • Dec 15
Patriot Transportation Holding, Inc., Annual General Meeting, Feb 03, 2021 Patriot Transportation Holding, Inc., Annual General Meeting, Feb 03, 2021, at 11:00 US Eastern Standard Time. Agenda: To elect the five director nominees listed in the accompanying proxy statement for a one-year term; to ratify the audit committee’s selection of the Company’s independent registered public accounting firm; and to approve, on an advisory basis, the compensation of the Company’s named executive officers. Reported Earnings • Dec 14
Full year 2020 earnings released: EPS US$0.076 The company reported a poor full year result with weaker earnings, revenues and profit margins. Full year 2020 results: Revenue: US$88.7m (down 18% from FY 2019). Net income: US$257.0k (down 85% from FY 2019). Profit margin: 0.3% (down from 1.6% in FY 2019). The decrease in margin was driven by lower revenue. Over the last 3 years on average, earnings per share has fallen by 65% per year but the company’s share price has only fallen by 10% per year, which means it has not declined as severely as earnings. Is New 90 Day High Low • Dec 08
New 90-day high: US$11.39 The company is up 32% from its price of US$8.65 on 08 September 2020. The American market is up 11% over the last 90 days, indicating the company outperformed over that time. It also outperformed the Transportation industry, which is up 19% over the same period. Reported Earnings • Dec 05
Full year 2020 earnings released: EPS US$0.076 The company reported a poor full year result with weaker earnings, revenues and profit margins. Full year 2020 results: Revenue: US$88.7m (down 18% from FY 2019). Net income: US$257.0k (down 85% from FY 2019). Profit margin: 0.3% (down from 1.6% in FY 2019). The decrease in margin was driven by lower revenue. Over the last 3 years on average, earnings per share has fallen by 65% per year but the company’s share price has only fallen by 18% per year, which means it has not declined as severely as earnings. Is New 90 Day High Low • Oct 22
New 90-day high: US$10.64 The company is up 25% from its price of US$8.48 on 24 July 2020. The American market is up 8.0% over the last 90 days, indicating the company outperformed over that time. It also outperformed the Transportation industry, which is up 11% over the same period. Announcement • Jul 23
Patriot Transportation Holding, Inc. to Report Q3, 2020 Results on Jul 29, 2020 Patriot Transportation Holding, Inc. announced that they will report Q3, 2020 results at 5:56 PM, GMT Standard Time on Jul 29, 2020