using half the proceeds from LIFC sale to buy QSII in the 25 stocks to own portfolio. SSG uddated 5/1/08

Looks interesting - tell us more about the company - Quality Systems Inc

NB

Here's the numbers, by going to the data tab and typing in the ticker. Thingsa that stood out for me are no debt, $1.00 per share dividend. current ratio 2.6 - 1.0 mean they have two and a half times assets as liabilities. Very strong financials in a time where one may need to generate theri own capital rather than go and ask for it.

http://www.stockcentral.com/data/tabid/55/language/en-US/Default.aspx

From the tools>research links>yahoo company profile

http://finance.yahoo.com/q/pr?s=qsii 

remember to type in the company ticker when searching for research links.

It "seems" to be the ideal SSG candidate, check out the historical growth chart on the SSG the last three years are growing much better than the previous three.

Great quarter for QSII, plus they are sharing the wealth by increasing the dividend by 25%.

http://biz.yahoo.com/ap/080808/quality_systems_mover.html?.v=2 

Updated SSG does not include the latest earnings release on 8/08. I did update the dividend from .75 to 1.00 in sec three for 2007 since the dollar figure is TTM number and the dividend is being increased. I left growth at 15% as they seem to be meeting these goals in a tough business enviroment. U/D is 3.3 to1, so even with the 15% rise in price today it is still in the buy zone. I also used the expected EPS in sec 4 of $1.67. My guesstimate is they will be able to meet this with the next year. The selected low price might be a little lower than needed as the recent price was $27.63 on 7/14 and hadn't been there for some time.

http://finance.yahoo.com/echarts?s=QSII#chart3:symbol=qsii;range=1y;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

Danny,

I just read the proxy statement yesterday and appears there is big fight between board members.  Also the CEO is leaving August 16.  It wasn't quite clear why he was leaving.  I am not experienced enough in understanding business to know if this is really all as scary as it sounds.  I haven't seen any announcement on who is replacing Silverman.  Can you help?

Lynn; Here is the link to the replacement as filed in the 8K for change in directors etc. http://biz.yahoo.com/e/080812/qsii8-k.html

Here's a story of the new ceo's experience http://cf.us.biz.yahoo.com/bw/080812/20080812005423.html?.v=1 . With what he has done for others I wonder if he may try to position QSII for a buyout suitor. (My guess). He has 50,000 options that are priced at the closing 8/18 date and are automatically vested should the company sell. Should someone pay a premium for QSII he would have a significant payday.

Why do you think the board is at odds with each other? I know sometimes when there are personell moves people take sides and that may be a reason. Share the Link to the story you read that gave you that impression. Boards athat are at odds don't really concern me. I dislike the rubber stamps that are often found on many boards.

Danny,

Thank you for the quick response.  I was just not thinking.  I should have known to check Yahoo.  Interestingly, the new CEO salary is about in the range of guy leaving and as a board member he already has 46,000 shares of stock.  Getting options etc. sounds like what they have done with others.  That he can get them right away if company sells is interesting. 

The proxy statement (which I received in the mail, but I assume is on their web site), has pages of discussion about Ahmed Hussein who owns 17% of the stock and wants a by laws change so that he can control even more of the company and get rid of Mr. Razin.  He seems to be mad at the founder, Mr. Razin.  Hussein has been trying to run competing slates since 2004 annual meeting, getting a couple of his nominees on the Board in 2006.  The Board had a settlement agreement with Hussein, which they don't think he is complying with.  So in this election Board has put up couple new people to replace Hussein's members as well as removed Hussein.  However, since he controls so much of the stock and there is cumulative voting, they can't totally get rid of him.  Hussein supposedly has a totally separate proxy form that shareholders can use, but I didn't get one.  Sounds like a TV script.

Hopefully they can focus on what is best for shareholders. They have done that so far with a good dividend policy.

Danny,

Do you own QSII?  Now I have received all the information from the man fighting the board with his alternate proxy statement and board slate.  He claims that company is in trouble.  That their report only focused on last five years because comparison to prior years would show it was going down hill.  Also sales to new clients have only increased by 8.16% over 3 years (not annual).  He supports the dividend increase but only if tied to business strategy, a business plan and a budget based on the plan.  He says that management has none. 

There is no annual plan with a management letter.  All I can find in the 10k is they will continue to develop software, invest in infrastructure, maintain expense discipline, add new customers, and expand relationship w/ existing customers.

All these classes I have been taking try to show you how you could have picked up that a company was going downhill or running into management problems.  I just learned at InvestEd about price charts and thought I would check that.  PERT A looks good, Take Stock says good company.  I checked out annual report analysis form (Bob Adams) and looked at financial statements.  Accounts receivable and inventory make up 48% of the current assets.  If you substract that amount, there is 72.500,000 left in assets with 70,216,000 in liabilities.  That seems pretty close to me. 

So - What does this all mean?  I have to say, since I started going to classes on reading financial statements and annual reports, I worry about most of the companies I own.  Am i overreacting with QSII?

Lynn I do not own QSII personally. I added it to my portfolio ino the 25 stocks to own contest. I wonder if the Board member has a reason for thinking the company is not doing well. I'm sure analysts have looked at the three and five year results. Does he have a solution or just want his voice heard on this matter. Most Board members do not deal in the day to day management operations. Might this CEO change be a part of the forward direction of the company. Just some thoughts.

Lynn here is an advisory company's recommendation on the proxy by Mr Hussein.

http://biz.yahoo.com/bw/080825/20080825006035.html?.v=1