I regretfully submitted an article on CCUR to value investors club and micro-cap club. The thesis was that CCUR was trading below liquidation value, even if their 80% investment in LuxeMark Capital, LLC had completely failed. After reading several recent Bloomberg articles, I found that Abe Zeines (who CCUR is bringing on to LuxeMark Capital, LLC) has ties to David Glass, a real scum bag (actually portrayed by Ben Affleck in “Boiler Room”).
The fatal flaw in my analysis was downplaying the sketchiness of the merchant cash advance business. If I wouldn’t invest money in LuxeMark Capital, why should I be investing in a company that may or may not do the same? What does that say about the character and judgement of the management for even considering LuxeMark as a viable investment?
I have tried to contact CCUR management and some folks at LuxeMark Capital in regard to these Bloomberg articles. Their silence is deafening. I have completely sold out of my CCUR position.
Lesson learned: Focus more on the character of the management when performing future analysis.