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RadioShack AO Message Board

  • sync2l12 sync2l12 Apr 30, 2012 7:09 PM Flag

    A take under is RSH only hope to survive

    Somewhere in the 2-3.50 range to absorb all the debt they have and this money losing buisness. The buisness is worthless but some of the real estate does have value. The buisness model is shot dying a quicker and quicker death. Hopefully management will strike fast at any takeunder suitors. Circuit City let it go down and be worth nothing. RSH just may do the same.

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    • I don't understand why some posters here keep bringing up the idea that RS has vast holdings of real estate that can somehow be sold off. The stores are leases held in strip malls for the most part. These are worth absolutely nothing, especially in an economy that has not improved at all regardless of what the current administration likes to believe. The store fixtures are equally of little to no value. Shelving, pegs, old cash registers, worn out carpet, etc. The only real hard assets consist of the inventory and I don't know off hand what percentage of that is owed to creditors.

      This is a classic case where the value of the business is in its cash holdings, after debt, and good will. And any accountant will tell you that good will is not a tangible asset. Plus, a company whose customers are leaving it and whose sales are declining at a faster rate all the time is not one who has much in the way of good will.

      • 1 Reply to railroadxxx
      • I am looking at this stock as a possible `value play', but the `value price' may be below where it is trading for today. The money is in the real estate...yes leases. If a buyer could figure out which leases are worth keeping, subtract out the lease cancellation costs for those locations not worth keeping, and get a discount from there, one may have a fair price. Question is...what to sell at these locations? May be something totally unrelated to electronics.

        Problem with this, FMV may be around $1 a share