Management could buy back another 300M worth of shares
Management still has board approval to buyback 79M worth of shares. They have already bought 221M the last 26 months.
There is 291M available under credit facility. There is 237M sitting o our books. Management could get approval to buy back another 200M of shares on top of the 79M available using credit facility AGAIN and company would remain perfectly solvent. There is o reason this action should not be taken.
Buybacks are not necessarily the best use of money.
If they could open a store with $2M that will sell millions over the years or buy back 27,000 shares (.07% of the shares), the return on the investment is better with opening a new store. Buyback, generally, mean the company cannot deploy the capital in a better fashion.
The company opened more than 45 stores from 25 months ago and has bought back more than 221M worth of stock. There is now 237M CASH and just 9M debt sitting on the books. The company has the ability to open stores(which are smaller these days and costing less investment capital) so there are no issues there.
Management should be putting metal to the pedal here with the cash. This winter was a tremendous gift due to its being so cold for virtually half the year here on the EAST COAST(since October). So while I understand comparisons for next year against this year may not be pretty if it is not as cold next year, the point is the brand is very relevant, record revenues, and the company should make more than 160M in cash next year due to UGG PURE playing more of a role in product as well as the 10% reduction in sheepskin costs for 2014.
This is the time to start grabbing shares for the company in a buyback. There is nothing else to do between now and next year BUT buyback stock. So they should be doing it.
Frog, I was confident they would have already used up the original buybacks by now. There is no reason for them to have not to have bought back any stock this whole past year with the 79M remaining. What the $$$$ are they waiting for? Secondly, this is two years later, and we are now much healthier than 25 months ago and we are trading at the exact price of the first 100M in buyback initiated 25 months ago. So 25 months ago, with all the concerns of sheepskin and warm weather in our face and hurting our bottom line, well, now with 185 reductio in sheepskin costs since that time as well as two consecutive cold winters and RECORD revenues, these guys (angel and co.) should be initiating buybacks with the cash on hand. The cash sitting on the books does absolutely NOTHING for us when we could be buying shares with it at dirt cheap prices compared to where we will be 24-30 months from now as well based on UGG PURE stemming the bleeding.