This is no mysteryThere is no mystery to why Aimia is getting trashed more that the rest of the market.
First, as per the report Feb 25., the company barely breaks even on it's own opperations. That situation was improving, but in this economy, it will be a long time before I would see companies making new investments in loyalty solutions. In a tough economy investments in loyalty programs are likely to be among the first cuts, so the company's opperations are likely to come up negative.
Second, PLM is an airline based loyalty program. The success is tied tightly to the travel industry which is suffering far more than most other industries. It's not just the airlines, it's hotels, dinning etc that feed into the sucess of a loyalty program, so we can expect that the contribution of PLM, the only real source of profit last quarter, will be next to nil.
The value here is that there is $349.8 million in cash and securities, and only 93 million shares outstanding. There are $231.1 million in preferred shares outstanding. The current state of the market creates a significant buying opportunity which I expect the new board is exploring diligently. Of course timing the market is not easy, and if they had deployed a lot of cash last week, we might have spent the weekend happy, only to see today's results. For the present, the fact that we are sitting on this much cash and securities ought to be reasuring, and we should be hopeful that the board will be able to deploy it advantageously in the current market, which likely has further to drop before it recovers.