My algorithm suggests that a lack of interest here is a good sign that I can get a good deal on an LBO of DAVE before the retail investor wakes up. I know I can get the Hayward and Three Lakes crowd to step up. I am going to offer a 15 cent premium and start a proxy fight.
you are correct with option #2. they'll sell the entire position privately for a lower price than what the stock trades at...knowing they could never sell it all in the open market efficiently.
I agree, option 1 would be most devastating for the stock price(down to $5 maybe $4) since none of these investors have any interest being stuck with this dog and would dump it as soon as they received it, they just want their money back. Lioneye filed on Friday, they sold about 50,000 shares this week, selling small amounts during he last 3 day's. My guess is they are going to have to keep selling in the open market until they get down to around 500,000 shares or so, then an institution might take a shot on this company. The question is, at what price? Trading at a forward p/e of 29 this stock is not cheap and the turnaround is not happening as planned so far, they are having a hard time getting the old angry customers to come back after the last CEO destroyed the customer base. Keep on eye on the volume and filings, should be interesting.
Thanks for posting this, I missed that news, and it's potentially very useful. I see three possibilities:
1) Lioneye distributes the shares proportionately to its investors. I don't see this as likely, as most investors would prefer cash, and would probably view DAVE as a dog.
2) Lioneye could sell their entire DAVE stake in a private transaction to another fund (or funds) interested in taking a flyer at a relatively low price.
3) Lioneye sells on the open market, which will mean great opportunities for investors to bottom fish.
I think option 2 is most likely, but I've been keeping an eye on DAVE as a possible year end bargain, along with a few other big losers this year. Have some cash in my Roth IRA I'd like to put to work for a quick gain from December to mid-January or so.
Why Lioneye owned Men's Warehouse is beyond me - Jos. A. Bank was a horrible business for them to buy, with heavy discounting and lousy product quality.
Looks like they cut a new deal with Wells Fargo, quick take is that they reduced their lending exposure to DAVE, upped the interest rate, stiffer terms, and want them to make monthly payments to reduce principle, I think they are getting cautious.
The amended forbearance period ends today, and still no amended credit agreement. What does that tell you? Flush....
Sentiment: Strong Sell
Lioneye Capital Management just announced they are shutting down by year end, how will they get rid out the 1.2M shares that they own.
like my comment below which I made before this one...these are all reasonable suggestions - send it to them.
Looked at their menu...Get rid of salmon and cod....broccoli ...coleslaw and rice and mashed pot...offer baked pot..fries or pot salad...corn or grn beans...get rid of tips......Need a totally different appetizer menu (those are reg items except for the onion)...Keep it simple......many more soups and add bread......have a cowboys sized meal or plate...a Trail Boss sized and a Ranch Owners sized......add a big steak or 3......
Doing so means getting better employees that can do more without supervision (but with more pay, of course)...maybe try profit sharing by the stores to motivate people.....share 25% of the stores net profit with the employees......stream-line the menu ......cut some frills.....add higher margin items.....offer a "dollar menu" (not really a dollar but lower cost items)......have many, many specials in the off-peak hours.......have a points club for free meals.....(spend $100 in 1 month get $10 credit).....offer many veggie dishes.....add salad bar....add soups....add big steak......Justa thought...
I sold my GMCR stock this morning (84% premium on my purchase price after this buyout announcement), and I bought a small position in DAVE and CAT today.
I'll keep this short and sweet...Google "PennyStock101' signup for their free newsletter and get their next trade alert. Come back and thank me tomorrow!