I own ESI and those shares are down 5% and I wanted to see if there was any reason for the decline (which there seems to be none, or I have yet to find out the reason). Anyway, I saw COCO down 20% and figured that I should take a look to see if there was something relevant here. I could not believe what I am looking at.
Market cap is $255 million
Debt has been reduced from $332 million to $98 million
(this includes capital leases!!!!)
Cash on b/s = $79 million
Stockholder's Equity = $570 million (up $5 million from prior year)
Cash flow for 2012 to equal $225 million.
All the above figures are incredible, but I have seen stocks trade at half of book value before (even with little debt). I do not think i have ever seen a stock trade at 1 times cash flow though. That figure is so stunning. One times cash flow! If I was able to buy the whole company here at this price, I would basically get all my money back in 1 year. Where is anyone going to find an investment like that?
Yet here the stock is down 20% today. Amazing. I guess in a marketplace where many, if not the majority, of buyers and sellers are only focused on price momentum, stock price direction and whether earnings guidance is being increased or decreased, there is no price that is in effect too low if these market players perceive things in a negative light (regardless of the above financial figures). And there is no price too high to pay if things look like they are perceived as going well (llok at AMZN's valuation).
I am talking about BK because of the balance sheet. You make my case for me. To wit, COCO has paid off debt. That used up cash. Now the cash position (see balance sheet) is $79M vs. accounts payable (that's money they have in current bills) is $183M (see balance sheet).
If you personally had %790,000 in cash, and 1.8M in bills sitting on your desk, do you say "all is fine, got lots of money" or do you say "hmmm, I wonder if I will be able to pay these bills given they exceed the money in my bank account."
It's not so funny at all.
I should add, I find it funny people are talking bankrupcy - look at the balance sheet - look at how they've paid down the debt - it's actually quite amazing when one looks at how quickly they've paid it down. And once the debt is under control/eliminated, we shall all laugh. Is COCO still a takeover? Will it sell? We'll see. I can't wait until next Q. though....
Eh, it'll get worse before it gets better. The Everest brand is a wreck; the only ground schools still growing are the Heald campuses. The 12 Heald locations now represent over a quarter of the company's entire student population. The entire industry is looking at a decline in both short and long term from changing demographics. CCi's prospects for survival are really dependent on if they can close down the money losing operations fast enough, while expanding the parts that do work; I.e. Heald and their online operations.
not good... here in Corinthian colleges land, i live in it daily and things are going down hill fast.
For all of you who think things are good, you dont know because you arent able to see the inner workings.
Reading a spreadsheet gives you very little true insight, come inside the walls and take a walk and you will see a whole new side of things.The Top brass paint a picture of possible upside buth those who are in here know things are headed south.
Great value trap, huh?
Numbers look great. Don't tell the story.
Book value overstated. Tangible book value = $200M
Revenues are declining. Campuses are emptying out The regulators are putting the hammers down on advertising and funding.
The lights were sill on and the music still playing when the Titanic sunk.
COCO has already hit the iceberg. But because the engines are still roaring and the clients are on deck, all looks OK. " It is just a scratch."
After the boat sinks, they'll still be saying "how did it happen?" Management hit the iceberg when it bought Heald. The rest is just the slow sinking story and the fantasies that all is OK.
the bonehead heald acquisition was made with the previous ceo. massismo was the captain prior to the previous ceo who manifest the huge revenues and growth. i thought it was genius to bring him back to make things right.
the heald acquision is being paid off rather quickly and the turnaround is going a lot better than most people thought. i suspect today's move has a lot to do with the shorts piling on and i'm expecting the short interest to be above 30% again at the end of this month.
i expect a couple more days of downward movement then i'll back the truck up and wait for the sweet short squeeze again. this stock is a gold mine.