It amazes me that several people posting on this board can actually believe they know something about investing !
Remember please, SSNC sells much of their product to Hedge Funds; Hedge Funds are well known for what ?
Very good: INVESTING
In order to sell to Hedge Funds, the sophistication of SSNC's product I would say vastly exceeds anyone's, certainly including myself, knowledge of investing, der- ivative hedging and the like.
Then, wouldn't it be logical to assume that if SSNC can sell products to Hedge Funds which are integral to their bus- iness and operations, just maybe they also know some- thing about investing, financing, capital formation, etc. ?
That being said, while I have absolutely no idea the intent or designs for this secondary offering, my strong guess would be they know what they're doing, and certainly more than the people posting here.
I 'spose the answer could be they are crooks ! Oops, the Chairman is a huge stock holder, so he would then be also hurting himself; not likely !
Remember also, the same people who have guided this Company's stock in the past year to an approx. quadruple in stock price, mostly via earnings, are the same one's performing this little maneuver.
Again, I have no idea why, but for an approx. 20% dilution and the stock to only decline only about 4% so far , I'd say that's pretty good and the "big, smart money" seems to agree.
This Secondary may not be good for the traders amongst you; I can understand that; but for the investor, my bet is this will all pay off handsomely.
Yes, and short interest increased by 60%in Jan-Feb. Hedge funds are the ones shorting this stock.
SSNC's license revenues have been abyssmal over the last three years- and in the recent qtr they were flat to slightly down. They acquired a fund administrator,so now SSNC is competing with some of the firms it licenses its software to. Yes outsourcing is up, but its very low relative to its overall revenue.
So, you think buying a software company that has had flat licensing growth warrants a market cap that is 9X revenues? You do the math- but this stock is way overextended, and no matter what the company has done to become profitable (it has done a good job at this), this stock price is unsustainable.
Ofcourse, the underwriters don't want anyone to understand these facts, at least until their fees are paid. And once the cash is in the bank SSNC can generate more investment banking revenues for them. It's a joke.