Current Share price $15.54 Market Cap $225M --- Expectation $35-$40 per share
Research and Synopsis on Turtle BeachUp until January, I had never heard of Turtle Beach, and as a small time investor, my first visual of the company came when I had noticed that the gaming segment was going up and put about 100 shares into Logitech before their Q4 earnings report. It came out positive; Logitech went on CNN's Mad Money and I made about 10% before I sold it approximately 5-6 days after purchase. I wasn't really looking, but my news feed showed Turtle Beach because it was a similar company. I looked at it for 20 seconds, noticed the stock was relatively flat the past 2 months, when others were dropping, and dismissed it because I was looking for companies that had a recent precipitous drop. I did notice that the market cap was $225 million though, and moved on.
About a week after this, I was walking around the mall with my 10 year old daughter and I walked into a gaming store. As I looked around, I noticed headsets prominently displayed, and knowing it was a gaming accessory, I asked what headsets sell the most. The worker went into how he thinks Plantronics make the best headsets because they worked with NASA. (Definitely not investing in Plantronics) While there, a guy I know from church walked in (chick-fil-a worker on break) and said "You don't even play video games, what are you doing in her?" I replied, "You are right, I don't, but I am looking for companies to possibly invest in." He says, "If you are looking at gaming headsets, Turtle Beach is the best around and they have been for years." I say "Did you know their entire company is priced around $225 Million?" and he says "That is really low, I would have guessed at least double that."
I then make it a mission to find out as much about Turtle Beach as possible because as my friend said, "I don't play video games." I went asking around at a youth event at church to see what gaming headsets they use (to about 25 youth). I got 5 Turtle Beach, 2 that had Razer (I think) but want Turtle Beach, 1 that had Astro (Logitech brand), and 15-20 that either didn't play video games or had no headset at all.
Now I am really curious, I go into Target to talk to electronics people and asked some dude about headset sales. He says, "I can actually show you data on my scanner." My eyes lit up! Real-time-data. He walks over and scans an item and I notice that Turtle Beach had sold $70k worth of this one headset (stealth 700x) on week-to-date. This is around the same time that APEX legends had launched, but no numbers were out yet.
I buy 500 shares.
On 2/13 (Wednesday) I go back to Target and get someone to help me with a scanner. I have him give me the week to date sales totals of every single Turtle Beach product, the result, week-to date $300k+.
I buy another 1000 shares.
I hear about APEX Legends getting huge numbers so I go back on 2/16 (Saturday) and get a new week-to-date number, $517K in sales.
Bought another 1200 shares.
I go in on Monday 2/18 and the week had reset on Saturday night or Sunday, so now I am thinking the $517k may not have included a Saturday. 2/18 number is $132K (Sunday sales, I think). I go in on 2/19 ($214K). I think this is Sunday and Monday sales, but definitely $82k for one day. I also am able to see the literal markup % of between 30% - 40% per product. I go in again on Wednesday, Thursday, and Saturday but am unable to access the numbers as the stockers and electronics people who have been helping me are now getting error messages when they try to access the data
I then go hunting for electronics sales info and find a chart from 2017 that shows the top 10 retailers for electronics.
#10 is Target.
Bought another 1250 shares.
I then went into a gamestop to ask questions, and heard at this store they were selling about $800-$1000 worth of Turtle Beach per week. I asked how many Gamestops there are in the USA. They said over 4,000 and we are one of the smallest stores in the area.
I then start calling Gamestops from all over the country
I call Philly, Boston, Alexandria VA, Alexandria LA, Lincoln, Rockford, Anaheim, San Jose, Oakland, Portland, Minneapolis, Greensboro, Greensville, Dallas, Fort Worth, Houston, Atlanta, and many more that I cannot remember. This is what I gathered. The stores vary greatly in Turtle Beach sales. Some are around $150 per week, some are at almost $2,000. Over half said it was their largest mover for headsets. The average I believe is around $600-$800 per store. Their markup is also higher than Target with selling price marked up around 40%-50% over what they paid.
I also went into Best Buy, Walmart, and looked at Amazon and how recently people were rating the different versions of the headsets. Are they buying now??
The answer. YES
No man in the wrong can stand against a man in the right that keeps on a comin'
