Ruger President Steve Sanetti moving on

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El Numero Uno

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There is no doubt that the NSSF job is a good one. Steve is 58 and will probably enjoy this role until his final retirement. On the other hand, it is disheartening to see the "old People" leaving. Bob Stutler at Prescott just retired and was replaced by one of Fifer's former associates at Mueller Industries.
 

JNewell

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Wow. Any speculation on the reasons that aren't in the press release? Or maybe there aren't any...but usually there's a backstory.
 

golferboy426

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As a decent size stockholder I don't know who is worse, this team or the old team post Bill Sr. Steve was part of the team that saw the stock drop from 25 to 7-8 and cancelled the dividend. If you look at the normal stock variation, a 6% pop is within its standard deviation. Bottom line is this company has been poorly run since Senior passed.
 
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The last place I worked had been a family-owned outfit. Shortly before I took employment there, the "old man" died. He had always run it "his way" and been very successful because he was very sharp and knew when to take risks. After his passing the "management" really didn't know where to begin in running the place. It floundered for several years as all the upper-level guys maneuvered in an attempt to be top dog. Then a competitor made an offer big enough that the surviving family members couldn't refuse and the place sold, to a foreign outfit that used it as a loss leader for two years and then sold it again. This has happened several more times, and the place is currently running ragged trying to figure out what their business even is any more. Sad.
 

chet15

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golferboy426":24lm51jm said:
As a decent size stockholder I don't know who is worse, this team or the old team post Bill Sr. Steve was part of the team that saw the stock drop from 25 to 7-8 and cancelled the dividend. If you look at the normal stock variation, a 6% pop is within its standard deviation. Bottom line is this company has been poorly run since Senior passed.

Golferboy: Check out your recent history and you will find that after WBR passed, the man in charge was WBR,Jr. Have heard horror stories about his short tenure...the biggest being that one of the first things WBR,Jr. did was get rid of QC. Hmmm! Their production did exactly the opposite of what he thought it would, going from several thousand units shipped per day to only 1,000. The time period when Ruger wasn't making any profits, this is when Ruger stock was at its lowest point! And this was when many of you were sending their guns back to the factory because of problems. Well, this finally came to a head and the "other" Board Directors needed a solution. This is where the new management team came in, including the new C.E.O. Fifer. What they brought with them were new management ideas to get the company back on its feet again. Will their ideas work? Its probably too early to tell, but somebody's got to make the decisions.
WBR was the man. What he said either went or you would stir up a hornets nest. I'm sure when WBR, JR took his position everybody at the company followed this same lead. After all, he was the boss right?
So if Sanetti did anything wrong (besides leading his own possible hostile takeover), it was "guilt by association". I'll stick up for the man.
Chet15
 

chet15

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Ale-8(1)":i98967yn said:
The last place I worked had been a family-owned outfit. Shortly before I took employment there, the "old man" died. He had always run it "his way" and been very successful because he was very sharp and knew when to take risks. After his passing the "management" really didn't know where to begin in running the place. It floundered for several years as all the upper-level guys maneuvered in an attempt to be top dog. Then a competitor made an offer big enough that the surviving family members couldn't refuse and the place sold, to a foreign outfit that used it as a loss leader for two years and then sold it again. This has happened several more times, and the place is currently running ragged trying to figure out what their business even is any more. Sad.

In a day of takeovers like you describe with big CEO payouts, it would not surprise me to see Ruger go down this same path. Don't forget, their stock seems to be on a rollar coaster ride at a point nearly at its lowest level. You just may see something like this happen.
Chet15
 

Boxhead

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JNewell":gpllk273 said:
Wow. Any speculation on the reasons that aren't in the press release? Or maybe there aren't any...but usually there's a backstory.

Heck he is 58 and certainly has earned his retirement. I plan to be gone long before 58. Myself, I am liking the "new" Ruger...
 

mcknight77

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chet15":14h5s6ly said:
Ale-8(1)":14h5s6ly said:
The last place I worked had been a family-owned outfit. Shortly before I took employment there, the "old man" died. He had always run it "his way" and been very successful because he was very sharp and knew when to take risks. After his passing the "management" really didn't know where to begin in running the place. It floundered for several years as all the upper-level guys maneuvered in an attempt to be top dog. Then a competitor made an offer big enough that the surviving family members couldn't refuse and the place sold, to a foreign outfit that used it as a loss leader for two years and then sold it again. This has happened several more times, and the place is currently running ragged trying to figure out what their business even is any more. Sad.

In a day of takeovers like you describe with big CEO payouts, it would not surprise me to see Ruger go down this same path. Don't forget, their stock seems to be on a rollar coaster ride at a point nearly at its lowest level. You just may see something like this happen.
Chet15

Chad, I believe they've just bought back a bunch of their stock. That's a sign of a healthy company.
 

golferboy426

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Actually buying back stock is very misleading. It allows the earning per share to artificially rise as those shares are no longer part of the base calculations. It also is used to allow the generation of more cushy executive options. All it really means is that ruger is flush with cash from disposing of its assets in real estate and the company gun collections for example and with today's money rates , they are betting that as the economy turns ,stocks generally will rise so the return will be better than other bank or bond investments. However what the stockholders here should be watching is performance relative to the market, that will tell you if Wall Street believe the company is healthy
 

El Numero Uno

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Ruger has always been flush with CASH; it is not just a result of the recent land sale to WBR, Jr. and the Auctions. There has never been any debt. The Company feels the Stock to be undervalued in the Market and that is why stock buybacks ar put in place
 

golferboy426

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The first thing they should be doing with all that cash is restoring the dividend, that is they truly are healthy. We have had lots of stock for many years. Actually too much stock for far too long. Let's see them put out at least consecutive quarters of decent profitability.
 

weaselmeatgravy

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They have not always been "flush enough" with cash, cutting the dividend is the first thing you do when income doesn't cover expenses. They may have been able to cover the expense of maintaining the dividend for a while with cash on hand for a few quarters or years, but if the earnings are not there, something's gotta give.

Large dividend payouts are a sign of lack of growth - creative stagnation - no bright ideas for ways to re-invest the earnings so they turn it back to shareholders.

There's two types of companies that don't pay dividends - those who have better things to do with the money to grow the business (expanding), and those who no longer earn enough to continually pay out dividends (contracting).

For a steady stream of dividends, look more toward utility companies.

RGR looked unbelievable in the early 90's when share price was going up, up, up, and it still paid a high dividend. It is unrealistic to expect both trends to continue.

The reason to buy RGR today is that you believe in a turnaround story and share appreciation, not because you need quarterly income.
 

mcknight77

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And, buying back stock reduces future dividend "debt". When (if) it turns around, RGR will have more discretionary money to use for growth, R&D, etc., rather than paying it out in dividend. It can also prop up the stock prices, or drive them up if not done slowly.

Now, if you've inherited a bunch of stock, then I can see why you'd want dividend. Probably, as WMG says, to sell out RGR and put that money into something paying dividends, would be the best. Also depends where you are in life. Older folks need the dividend, rather than the growth.

I don't believe that the gun business has ever been steady enough to be a consistent dividend payer. Sure, there's been a lot of money made in the gun business, but there's also been a bunch lost. WBR has done about as well as anyone, better than most.
 

contender

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I will stand with Chet15 on this & stand by Mr. Sanatti.
We could all discuss a lot on stocks, dividends, etc, and we'd be doing the same thing done every day on Wall street.
I just hope I can see Mr. Sanatti again at the NRA show & thank him for the time he spent at Ruger.
 

weaselmeatgravy

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Contender and chet15, don't get me wrong - what I know of Sanetti is all very positive and I too stand by him and am sad to see him leave. I was only pointing out the reaction of the stock on the day the announcement was made. I don't think his departure is a good thing for those of us who care about the company, it's products, and the preservation of it's roots. I only note the stock pop as an indication of what the big investors may be thinking: out with the old, in with the new, focus on profits and earnings. Cheaper production methods, volume sales, reduced inventory, better forecasting, bottom line growth.

RGR is a small-cap stock that is thinly traded and large percentage moves up or down don't take much volume. The stock was beaten down when WBR Jr. and Carolyn Vogel sold off millions of shares that were difficult for the market to absorb so the price could only go down. It started to recover and made it up into the $20's before the unexpected low earnings drove it back down. It is 70% institutionally owned and those big players are pretty fickle. It doesn't take much disapointment to drive them from a holding mood to a selling mood, and so it is a fairly risky stock for us little guys to be very heavily invested in.

Be passionate about the guns and the heritage, be sad to see that all change, but be emotionally detached if investing.

Myself, I have a small amount of stock and am not selling. I believe in the turnaround story from a business perspective and I understand that the Lean process implementation never starts off smoothly, there are always glitches and Ruger will work through those. Or, it will be taken over by another company. Either way, I personally don't see a lot of downside risk at the current valuation. That doesn't mean I like all the changes that are being made (internal locks, dropping the "S" in the logo - boy does that ever piss me off, whatever happened that made Sanetti leave, etc). And it doesn't mean I'm going to put my retirement savings into the stock. I just dabble in it.

And while we're at it, some of the changes have been good, like moving the Warning rollmark to the bottom of the barrel, coming out with the 50 year flattops and Bearcats that are truer to their roots than the 50 year Single Six ever was. The SR9 and the LCP both look very promising. And I actually bought a Charger.
 

golferboy426

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well put WMG, I've had the family Ruger disease for a long time . I even play their driver when I golf. However as an investor also I expect positive results. If I have a chance at the shareholders meeting I hope to ask Mr Fifer about dropping the S. The only explanation I can think of is there was some royality payment . I can think of no logical explanation.
 
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