RE:RE:RE:RE:RE:Now look for a 50% pull back, minimum Capharnaum wrote: Energyrunsearth wrote:
yes.... OK.... but when the company no longer owes debt.... thats money has been injected into the company, whether or not you wish to acknowledge it.
It is also kinda funny how you acknowledge this fact even, "100million in NEW cash injected." Because thats is true. Just like debt paid (whether by issuing new shares)it is a true injection of cash.
Now correct me if I'm wrong... but 600 million was just injected into the company. (Without ignoring the facts.)
Considering that debt was settled at less than 15 cents on the dollar, it clearly means that the value of the debt wasn't anywhere close to $600M. Otherwise, the creditors would have asked for more. Saying $600M was injected in the company is like saying that you put 100k into a business because your new 20k investment was made at 20% of book value.
$100M of new money was injected in the company and about $40M was converted from debt to equity. The rest stayed as debt. So, in terms of how JE was valued prior to the consolidation, you could say that $140M worth of new equity was subscribed.
Right now, compared to pre-consolidation, JE has $100M more in cash, lower interest payments and a more favorable debt repayment schedule. At the same time, the equity holders have been diluted. We'll see how it shakes out in the end, as value will depends on their financial results. Looking at Q1 EBITDA, JE may be worth over $10. However, they still lack credibility considering all that's happened in the past 18 months. So the share price might trade low for a while.
Well... a few things we agree on.
It will most likely stay low till all the weak hands are gone and shorts covered.
And that the company needs to prove its self before we have a meaningful rally.
But, I will stick to my sentiment here, I feel most will regret selling low. (I could be wrong by no means am I some kinda savont, this is just my opinion.)
Do you have an actual reason to sell this low? Other than the currant sentiment on the fact its a recapitalization. (I.e. people saying it always drops 50% after a consolidation. Which I'm not denying is common.)
Personally i see lots of upside potential, but we will see. I've said this before im longer term investor. So im not to worried about the short term here myself.
Really have enjoyed the back and forth here though man'g. I do want to know though, so did the 500,000,000 worth of debt and preferred shares not switch over to the now consolidated company? I could be wrong/mistaken. Either way, we do have a stronger company going forward. (With a horrible history, I dont deny that.) Only time will tell what the future holds! ;)