RE:Leased busses increment value to shareholdersslimjim11 wrote: Leased busses over the six year period accrete incremental value to shareholders. The residual six to seven years of the busses life earns revenue from a below-market valuation of the bus at termination of lease. Whether these leased busses are for new growth, or replace existing busses, the finance rate is 200 to 400 bps below the cost of debt. An off balance sheet lease, accreting value to shareholders, is a cause for comfort, not for concern.
I believe that STB has been leasing Busses since 2002.
To date there has been NO evidence of Shareholder Value Creation "incremental" or otherwise.
The “Tangible Book Value” is literally pennies.
That said STBs “Value” is the Revenue and Cash Flow.
The per share results to date have been underwhelming to say the least.
A while back I analyzed the Net Cash From Operations per share for the 2009 – 2015 period;
FCF = “Net cash provided by operating activities” from the YE Financials
SHARES = “Weighted-average shares outstanding-basic” from the YE Financials
| Fiscal Year | FCF USD | SHARES | FCF / SHARE USD |
| 2009 | $35.54m | 43.23m | $0.82 |
| 2010 | $41.66m | 55.11m | $0.76 |
| 2011 | $36.34m | 57.76m | $0.63 |
| 2012 | $34.91m | 66.14m | $0.52 |
| 2013 | $52.10m | 79.43m | $0.66 |
| 2014 | $46.41m | 82.10m | $0.57 |
| 2015 | $49.72m | 87.35m | $0.57 |
The Top Line Revenue and more importantly the “Net Cash From Operations” have both increased nicely in the 2009 – 2015 period. Unfortunately, that has been more than offset by the Dilution.
That well established trend may or not be reversing. Personally I will need to see some “evidence” before I believe it.
As Always; Do Your Own Due Diligence; It’s Your Money !!