Concordia Healthcare Corp. T.CXR.R

Taking it in the Chin

[ryehigh2014]

Market seems to be pricing in bad earning expectations or something might have leaked.

Note: I am a bull

[borrowedlife]

Rye..when is the earnings report coming out?

[ryehigh2014]

Early November I believe. I think CXRX is following Valeant's trend at the moment. The two companies are NOT the same.  VRX is trading the way it is because institutional buyers hold large positions - CXRX virtually NO major fund has a significant holding. Valeant is a 10x riskier investment - the company has competitive pressures and supplier pressures on almost all products. Yes teh

[LaticelnExile]

This post has been removed in accordance with Community Policy

[PROtrading]

See, that's why I'm in love with Latice.  Provide valuable information for anyone really intererest in pharma.  "Verita via Symphony"   But WTF is "LU"? And what about Delerium?  That's the drug all these longs have been taking like crazy!?  Sales must be right through the FREAKING ROOF!!!! 

[cg16]

Is Zonegram the same as Zonegran? 

[ryehigh2014]

This is their North American Portfolio which is 34% of earnings. Zonegran was doing fine. Dyrenium is peanuts. Real concern is Plaquenil which they are doign fine on - and pricing pressure is already baked in + impairment is already realized. North American Port     Covis   Original  

[puma1]

the Pound is getting slaughtered, the Democrats look to take more than the Whitehouse and MGMT just sold off $350 million of the common shareholders equity to the bond market stripping out what little equity might have been attributable to the commons. .............. Nothing else needs to be said imo

[ryehigh2014]

You realize the 350MM issuance was positive right? The company had a HUGE liquidity issue. Note liquidity does not equal insolvency but it can lead to it very very quickly. The company is NOT insolvent and generates enough FCF. The company was illiquid before the issue when comparing against current liabilities.  I agree with you on the cable rate (GBPUSD). That will weigh on earnings

[PROtrading]

ryehigh, it's FAR from positive since it gives the Notes front of the line access to the assets. At best, it's neutral.  As many others here are advocating, until we know who the Notes owners are, we're flying blind.  Instruments (the charts) are saying the news is not good.... Now, you're think that the Notes would be disclosed on SEDI!  WTF Anyone making any

[ryehigh2014]

Why does it matter who owns them? They received CM support when everyone was expecting NONE.  Finally who cares about who has first lien on assets if your a shareholder? If company goes under you get nothing. The issuance was positive IMO.  As well like I said liquidity concerns are gone for now - if management executes properly (by covering near term obligations) they will be fine. If

[Craigbad]

I'll try and simplify what has been happening for you on multiple using a simple ebitda multiple since you are putting some work into it. Mosts analysts use ev/ebitda but this is for demonstration purpose. if a company gets a 7.5 x ebitda multiple and has no debt, that multiple is strictly on ebitda in the case of cxr it would look like this taking debt into the equation. when the debt

[ryehigh2014]

Yup I understand what your saying. But to get equity value from EV you add back Cash and other non-core assets and NOLs. It is definitely more complicated. Anyways your original point still stands.  If you use an 8x multiple it doesnt justify a 4$ USD share price - its substantially higher. 

[Craigbad]

That goes back to management performance. They deserve the lowest multiple possible in peer group for bad guidance, lack of clarity, regulatory headwinds and higher than normal interest actually eating up ebitda which most other companies don't have. When I said the notes would reduce analyst targets in the $2-3 range the pumpers attacked, but it was based on numbers, not fantasy.

[ryehigh2014]

Agreed. However a 2-3$ price target is ridiculous and implies literally 0 growth and minimal value to intangibles. RBCs is more reasonable - although they took awhile to reduce the multiple. Either way its a waiting game now. Longs will suffer. Its retail longs vs. institutional shorts lol. Unless management puts out decent reports and performance longs have no hope. Im in the optimistic group.

[Craigbad]

Rbc has yet to update the new notes into their price target. Realistically they should be lowering their muliple and adding in additional debt, all of which should come out of their target price. It will be interesting to see how far they slash, although they have been the worst by far so far.

[puma1]

you cannot use an 8 times multiple here with the lack of visibility on the numbers - if they can deliver 4 qtr.'s of solid numbers and no surprises you could start getting closer but pointless right now

[Craigbad]

There has been a long squeeze ever since Q2. When debt to ebitda target went to 6.4 it squeezed out most conventional funds. The new notes now drive it over 7 and totally screwed value managers who took a stab at it. They wont be re-entering anytime soon imo. Thats why short interest coming down, its playing out better than expected due to managements actions.

[ryehigh2014]

Well yeah Looking at Debt/Ebitda alone you get around 7.8.  Net Debt/Ebitda you get around 6.78.  I'm forecasting EBITDA of 450MM and NOT the Adj EBITDA of 500-550MM range management provided. I actually HATE adjusted EBITDA - it is a dumb dumb metric.   This is why I say this company needs to show stable revenue and continuous +ve FCF. 

[marcrobert]

OK, so assuming we aren't looking at restructure risk any time soon, is anybody averaging down at this level?