RE:RE:RE:Verticalscope?@rinm99
Well, you are welcome! Fyi, PE firm Hellman & Friedman bought IB for Usd 640 million in 2010 at 13 times Ev/Ebitda. In 2014 KKR bought IB from Hellman for Usd 1.1 billion at again 13 times Ev/Ebitda. IB diversified in the SaaS space through acquisitions like Demandforce in the last few years. Through that IB is able to provide their corporate customers with SaaS offerings. Furthermore they bolstered their verticals with big acquisitions of internet platforms like WebMD and recently Avvo. They financed this spending spree mainly with debt and IB's debt ratios are sky-high, which is typical for PE firms scaling up their investments. For some more financial information:
https://www.moodys.com/research/Moodys-downgrades-Internet-Brands-CFR-to-B3-first-lien-credit--PR_370904
Today IB is a much bigger company than VS, but much more leveraged, too. I like a more conservative approach like Verticalscope's. Moreover, it is less risky. Bigger is not always better.
@retired234
Seems like the trading is incredibly thin at the moment and bid and ask just don't find together:-)
@marpincan
Thanks for your critical opinion which is very much appreciated. We should always try to invert and not get lost in the "confirmation bias" - to see only things we like to see. A couple of points:
- You are right, there has been a lot of financial mismanagement by the managers and board of Torstar. You named it: shopping.ca, wagjag, Star Touch and several others
I absolutely don't want to defend the management of Torstar, but they didn't burn through the whole Harlequin and Vaughan property sales price (combined about 500 million).
They retired the outstanding debt of nearly 180 million and bought 56% of Verticalscope for 180 million which so far seems a successful investment. To get some perspective I present free cash flow and dividend cash flow since the Harlequin sale closed in August 2014:
Free cash flows: 2nd half 2014: +10 million ; 2015: +7 million ; 2016: -29 million ; 2017est: -10 millionn => Cumulated fcf -22 million from July 2014 to the end of 2017
Dividends: 2nd half 2014: -20 million; 2015: -41 million; 2016: -14 million; 2017est: -8 million
=> Cumulated dividends -83 million from July 2014 to the end of 2017
So it isn't fair to say that they burned all the money in their operations, even if they had a lot of failures. Furthermore, the whole industry has a systemic problem. Print advertising has been declining unabated for years and so far no company has found the wholy grail (besides international brands like New York Times or Washington Post). To say it once again: I don't want to defend mismanagement, but show a bit of an objective picture.
Generally, I look at stocks from a risk reward perspective. No stock is risk free, but I think that Torstar has a compelling risk reward ratio at this level, if you analyse the parts of the company. Of course it could go to zero in several years if all comes together and they make big and bad acquisitions in the future, but Imo the probability is low.