RE:Some thoughts Thankfully I've been out of this stock for a good while now. By now, after such decline, you'd think that nobody on this board would still spew nonsense about the company's prospects.
1. Why would they ever do a buyback of the shares ? You said it yourself, shareholders don't matter anymore, Any forme of asset left, especially cash, will go to debt holders and maybe a portion to bond holders.
2. Your scenario doesn't add up. The only reason a company does a share buyback on the public market is to increase the EPS on a per share basis, which would in turn drive value up. You have to give up some of your shares for that to happen. Appart from a limited offer, in which a company can offer a premium to its shareholders for their shares, there's no way you will get to your 6$-8$ figure. How did you even come up with that ? Besides the company's earnings are negative. But let's assume and use the ''adjusted earnings'' of Q3.
Total adjusted earnings of 35 159 000$
Adjusted EPS of 0.69$/share ( 35 159 000$/ 51 000 000 shares )
On an adjusted basis, the shares are trading at a 3.91x P/E. ( 2.70$ per share/0.69$ eps )
You say buy back 10 million shares from the total outstanding of 51 000 000 shares, thus cutting it to 41 000 000 shares and spreading earnings on those.
41 000 000 shares/ 35 159 000$= 0.86$ adjusted EPS
Put this back to its price, and you get 3.36$/share ( 0.86$/share x 3.91 P/E ).
Not sure whether you just miscalculated those numbers or simply invented them but given my skepticism I'd say the latter.
To everybody not trading this stock actively, I'd say get out and focus your energy and whatever money you can salvage from the sell on other stocks. Better yet, wait until January to do it since stocks are overvalued anyway at the moment.
greatplay wrote: Most shorters made a kill today, what I mean, they have been covering around 2.05 all day long...
Why? volume talks... Anybody expected good quarter, not really, but it was a bit worse than I expected... Why? Current CEO, didn't much care (most companies back numbers to a certain degree) and the coming CEO didn't want to be part of it, until he becomes CEO.
One thing I didn't like in Earnings release: one statement: "stakeholders", not shareholders...
They don't care about shareholders at the moment... and it's really easy solve the problem... just do buyback of 5-10 mln shares (company has $470MLN cash) - 4.5 times of company current share value. And stock will be around $6-8 a share at least.
At the present moment shareholders aren't their concern, at least outgoing CEO's view... Now, with new CEO, we will see... I have 0 doubt that company will prosper, but a question is, will their stock be around? I think, yes; in couple days we will see, where stock price will go...