Market telling us that COOL's cash is only worth 85% of its face value, or alternatively that their products actually detract from the enterprise value. Why doesn't the company buy back shares? They could realize a better return than they are currently seeing from game development.
85% of face value? well the u.s dollar isn't exactly going up these days but i don't think that's the point the market is saying. i think more along the lines the market is telling us that COOL is going to burn through it's cash. The market is saying zumba is cooling down and needs a new money maker. this company has a habit of bouncing back and zumba isn't going to go away too many people hooked on it. zumba is a prime candidate for dlc's i wonder if they're doing that on xbox 360.
Someone didn't pay attention during the conference call last week, obviously. Management themselves said that they will likely lose money this year until the next generation of game consoles come out. That means that the 70c per share in cash will likely be 55-60 cents by the time the next XBox and Playstation products come out. Also note that the new Wii U already came out, and the numbers for new games sold has started off slow.
If you look at what happened to THQ, and look at how EA and Activision/Blizzard are just hunkering down, it may end up even worse than what Management warned in the conference call.
An investment in COOL is just playing the roulette wheel at your nearest casino.