Full disclosure, I purchased some MOZ at .45After a record...

Full disclosure, I purchased some MOZ at .45

After a record quarter - which was mainly due to stores being open, MOZ reported a "Net cash" position of $26.4m. This does not mean they have $26.4m cash spare after their current liabilities - this is strictly cash after debt. The current lockdowns will be killing MOZ financially as they will struggle to be meeting their short term liabilities.

The only reason to be buying or holding MOZ at the current point in time is either a bet on online sales of MOZ, which is unlikely given the demographics of their customer base (older with a slower uptake on eCommerce) or a bet that stores will open prior to Christmas.

The latter is what I am betting on. With Australia on track to meet it's 80% goal by 18th of November, and the 70% goal on the 1st of November (Even conservatively, these will still fall before December), I think MOZ is poised to have one of it's greatest months ever this December and the reduction in the likelihood of lockdowns should allow them to return to a state of consistent profitability after. The focus on paying down debt and renewing loan facilities have convinced me that management are know how to handle this situation. Paying off debt after a highly profitable quarter, and renewing debt facilities to brace for seasonal swings are exactly what they need to be doing to stay solvent.

The market is currently pricing MOZ to almost certainly go bankrupt, which isn't an unreasonable given it's previous 18 month run and the uncertainty regarding COVID. However, I think the performance of MOZ during last years Christmas period and the last 3 months show that the chance of bankruptcy is far lower than what is being priced in.

I don't believe there is a 'reasonable' valuation you can give this company in it's current form. Anything between $0-$150m wouldn't be unreasonable.

Interested to continue the discussion on this one.