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NYSE Euronext, Inc. Message Board

  • stockman201 stockman201 Jun 2, 2006 12:13 AM Flag

    Accretive is Good, Dilutive is Bad

    Finance 101 here for the newbies, Accretive means it adds to earnings immediately. Dilutive means it takes away from earnings. This deal is accretive from day 1. This deal will add almost 400 MILLION DOLLARS to the bottom line over 3 yrs in cost savings. The AX deal was said to add about 200 Mill over 2 yrs. These are good things folks. NYX wont open at 100 tomorrow but over time when the earnings are growing nicely we will hit triple digits, be patient. NYX is in the drivers seat.

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    • wow, just saw the news. congrats to those who own it- too late at night to do some calculations but this deal has been assumed for a while. these types of mergers can be tricky to put a value on. will have to look at other similar examples - not AX merger because the NYSE side was not public.

      some general thoughts-
      - while the price paid is not at a premium from the current last sale, this stock has rallied ahead of time.
      - the dividends are nice, but did Thain mention an amount or yield?
      - the board split while in NYSE favor is good, but the nationalism thing still worried me. have we heard from the French etc. gov'ts?
      - don't forget the arb's. do they but Euronext and short NYS as their hedge. it might put a top on the stocks until they get their intitial positions. am checking on that already.
      - did someone mention that the DB can negotiate a higher price with Euronext or CME? would have hoped they had a lockup.

      at least this is another big piece of the puzzle which should clear away some of the clouds overhanging the stock. it certainly has gotten more interesting the last few days. Thain for Time magazine's Man of the Year.

      this news does add to a great night. Pearl Jam rocked NJ tonight!