I think the Company needs to explain themselves after the stock dropped almost 10% from $10.10 because people think free cash flow guidance is at risk after "In the Mix." I think if they reaffirm full year revenue and free cash flow, should not be an issue.
Saw 2 outperformance + In the Mix shortfall should be a wash
LGF is appearing at the big UBS Media Conference in NY next week. The last agenda I saw which was still preliminary said they were on Tuesday at 3:30 ET. Given this, a need to update guidance was imperative.
I expect the guidance news to be bad. Just don't ever remember a Friday post close announcement from a company that indicated good news was coming. Add the big discrepancy between EBIDA and FCF, which is unsustainable, concerns about the DVD market, and In The Mix, and it just doesnt seem plausible the news will be good. I hope I am wrong or that the update will not be material.
Finally, I do see downside supported here by potential acquisition interest. The fact that Eisner offered to take a stake is interesting. We also have that former Icahn dude with over 7%, assuming he still owns it. Felt has been awfully cavalier about denying the company is for sale lately. If the guidance news is really bad, big shareholders are going to be pissed and push him very hard on this issue.
Hey, maybe they are clarifying guidance because they are negotiating with Eisner and need everything public. Fat chance.