RE:RE:RE:RE:RE:RE:RE:RE:Buy backmonty613 wrote: I was there. this is quite a different scenario. whether you believe it to be a useful tool or not, EBITDA is the key metric used across virtually all mergers & acquisitions activity for a business like this.
you constantly whine about WELL's interests costs - if someone buys this company for a cash payment, those costs disappear and the acquirer has the benefit of the full cashflow without SAID interest expenses. is that not a reasonable analysis?
WELL has one-time expenses due to M&A. if they stop or slow down acquiring, those one-time expenses disappear. is that not a reasonable analysis?
finally, I have gone into great detail on this board about their non-cash Amortization but you refuse to even acknowledge it in any way, only to keep rehashing the same Warren Buffet quote about Amortization and Depreciation. this was a $38MM expense in F2021.
you're saying this company simply doesn't make money. why did reputable big banks make loans to them if they don't have any capacity to pay? hint - it's because of the large non-cash expenses.
this is not Crescent Point Energy. this company can stop raising equity and sit back and let CRH and MyHealth compound cash. since you're so bearish, you'll be happy to know that their loans are monitored quarterly so the market will know if and when they default.
we get that you are an old man and have seen it time and time again, but this company is not a scam.
Anyway, one of Buffet's main principle is to not invest into capital heavy investments like CPG. The oil patch business model is quite simple, spend money to generate finite cashflow generation. On top of that, cashflow is higly unpredictable since it will vary based on the commodity price of oil. It's a tough business, since without leverage the returns can be anemic for a long time and with leverage it's a dangerous game when commodity prices (which ar cyclical) come down. There are also local headwinds related to the capacity of moving production, so there can be limits on production increases.
EBITDA by itself is just a measures of the total EV value (using a multiple), it doesn't mean the company can't run into financial problems and doesn't make the business activities more liquid. Investors should never use EBITDA as their only metric. Debt interest coverage should also be looked at, as well as cashflow generation and capacity to raise money that's not dilutive to shareholders.
There's little in common between CPG and WELL. Unlike CPG, WELL doesn't have to pump capex into the business to sustain its revenues and cashflows. Unlike CPG, WELL isn't at the mercy of high-volatility commodity prices that greatly affect cashflows. Unlike CPG, WELL doesn't inject capex info finite ressources, they use their capex to acquire assets that will generate perpetual cashflows (if managed right).