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Radware Ltd. (RDWR) Message Board

  • jeffereyf2003 jeffereyf2003 Aug 22, 2011 3:40 PM Flag

    management should announce a buyback

    RDWR has a ton of cash on the balance sheet. They could easily buyback 25% of the shares outstanding with the cash they have...that would reduce the shares outstanding to 15.75M and the EPS would go to $2.16 a share for next year...and at the current multiple that is $32 a share...or identify some additional initiatives or sell the company...I increased my share count by 120% today

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    • They finally announced a share buyback...only 5% of the shares...but that is 1M shares at these prices...

      • 1 Reply to jeffereyf2003
      • think about this...shares are bought on the open market...if 5% of float is bought it would raise the % ownership by the family who holds a large portion of the shares. They wanted $50-53 a share to sell...now they would expect $53-56...the share price being up 5% is reflecting the purchase of 5% of the shares outstanding. Maybe the owners have an offer they could accept, but now they are going to increase the value of their shares as they will buyback shares at $20, which would increase their ownership % and buying 1M shares for $20M...when they know those same shares after a sale would cost them $50M+...or buy shares at this price that has no buyout premium included. I was thinking they should have announced a $50-100M share buyback plan, but that would put 66% of the ownership to the family and only 33% in the public markets...

    • up 4.6% on my purchase from yesterday...I will take it

    • better served to keep the cash for growth initiatives. Buybacks just don't do much for fast growing companies.

      • 1 Reply to stonefoxcapital
      • But they have not been putting the money back to work based on the growth in the marketable securities and cash balances...I would like to see some new growth initiatives, but If the best opportunity is buynig back the stock because the shares are undervalued and they cannot put the money to work earning at least 20% then they should buyback shares at these levels. They should also think about stopping the issuance of stock based compensation and not dilute the shareholders...i think they have issued like 5% of the shares outstanding over the past year.

    • RDWR has 200M in assets that could be liquidated easily...market cap is $500M currently...they could buyback 40% of the shares outstanding currently...being that an announcement like buying 25% of the outstanding shares would should this higher...maybe the shares are bought at an average price of $32...it would drop the float to 5M shares, with the original owners owning 66% of the outstanding shares...I doubt they do it, but they need to make sure they are get the most return out of their cash hoard...and if they cannot reinvest in the firm to grow revs and EPS, then buyback shares or issue a special dividend.

 
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