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 — Q2 2017 call → NOWe need to determine if management conveys that the company is currently charging less than the market would bear, and that it is actively closing that gap. The transcript includes a question about pricing: "And has that bookings momentum allowed you to really turn up pricing?" Sven Lindblad responds: "We have not elected to focus on increasing pricing. We think the best play for us -- we believe that our pricing is where it should be and we believe that the growth should come from added inventory." Craig Felenstein adds: "So the only thing to remember is when you look at our pricing, a lot of our pricing has been set 9 to 12 months ago. So we tend to keep it consistent because obviously, our vessels are so small that we tend to make sure that our guests across vessels are paying a very similar price. So we tend not to adjust our prices too much during the year. There are instances where that may change but for the most part, we tend to be pretty consistent." This clearly indicates that management does NOT believe they are undercharging. They explicitly say pricing is where it should be, and they are not focusing on increasing pricing. They also say they tend not to adjust prices. There is no claim of a gap between price and value, nor any movement to close such a gap. The answer is 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.