Room to raise the ceiling: management says its own prices, rates, or terms sit below what the market would currently bea
The model's full reasoning — Q1 2017 call → NOWe need to determine if management conveys that the company is currently charging less than what the market would bear, and that it is actively closing that gap. The transcript discusses pricing in various contexts. Key points: In the U.S., there is minimal pricing, but they mention "we're looking at all the smart ways to do it" but environment is deflationary. They mention Woodford Reserve and Old Forester getting price increases. However, the question asks if management conveys that the company is undercharging relative to value and is now closing that gap. The transcript does not explicitly state that the company's prices are below market or that they are raising prices to capture more value. They talk about price mix, but it's mostly about volume and mix, not about raising prices to close a gap. There is mention of "we expect as we have higher volumes coming from our faster growing premium and plus brands" which is mix shift, not necessarily price increases. Also, they mention "we're looking at all the smart ways to do it" but that's not a claim of undercharging. The only specific price increases are for Woodford Reserve and Old Forester, but that's not a broad claim of undercharging. The question requires management's own claim that the company has been leaving money on the table and is now closing it. This is not present. So answer NO.
| Ticker | Company | Call | Date | Call grade |
|---|---|---|---|---|
| MEC | Mayville Engineering Company, Inc. | Q3 2022 | 2022-11-05 | B+ |
| CAG | Conagra Brands, Inc. | Q2 2017 | 2016-12-22 | C+ |
| SOHO | Sotherly Hotels Inc. | Q3 2016 | 2016-11-08 | D |
| RCL | Royal Caribbean Cruises Ltd. | Q1 2016 | 2016-04-29 | C+ |
| HPP | Hudson Pacific Properties, Inc. | Q4 2015 | 2016-02-25 | C |
HPP · Q4 2015 → YESThe question is: Does management convey that the company is currently charging LESS for what it sells than the market would presently bear — that its own prices, rates, fees, or terms sit meaningfully...YES The transcript shows management explicitly describing a gap between its current charges and what the market now supports, then confirming that the company is already closing it through mark-to-market resets and higher new/renewal rents. Victor Coleman states that the company has “rolled out 80% plus mark to market” on recent leases 2.5 years old, and that cash rent spreads on 1.6 million square feet executed since the acquisition were “north of 30%” with “20%, 25% mark-to-market for 2016 and 2017.
MEC · Q3 2022 → YESThe question is: Does management convey that the company is currently charging LESS for what it sells than the market would presently bear — that its own prices sit meaningfully below the value custom...YES Management explicitly states that they have taken pricing actions in 2022 and have "more room for margin expansion through continued value pricing even beyond the pricing actions taken during 2022." This conveys that their current prices sit below what the market would support, and they are actively beginning to close that gap with further value pricing.
SOHO · Q3 2016 → YESThe question is: Does management convey that the company is currently charging LESS for what it sells than the market would presently bear — that its own prices, rates, fees, or terms sit meaningfully...YES The transcript shows management explicitly identifying a rate gap at the Laurel hotel (and similar situations at other properties) where current charges sit below the competitive set/market, while describing active steps already underway to close that gap through continued ramp-up and occupancy/rate improvements.