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Liberty Global plc Message Board

  • zommerdoomer zommerdoomer Nov 8, 2007 2:54 PM Flag

    Good to go DOWN!

    Earnings after the close may hurt stock. Beat the Dart also agrees. "INVESTMENT SUGGESTIONS greater than one day - subject to volatility

    ... November 8, 2007

    ... 2:46pm ... SHORT Liberty Global, Inc. (LBTYA) - last $38.96 . LBTYA offers broadband communications of video, voice, and Internet access services primarily in Europe, Japan, and Chile. Overvalued based on P/E and other fundamental factors. As a result, any contract in earnings guidance will material affect stock price. Near term resistance suggests exposure to lower prices, while limited buying interest to contain price. DECLINING HIGHS complete trading pattern to attract new sellers.
    Near term resistance warrant PORTAL POINT within Subjective Probability model (SPM). Support $34.50. "

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • Looks like you were right. Good call.

    • They haven't reported yet, but 3 of their subsidiaries have and they all beat and raised guidance. I'd expect the same. Computer generated models are terrible at LGI, because they intentionally try to minimize GAAP earnings to avoid paying taxes. Fundamentally you need to look at their OCF and FCF numbers and their growth rates. Their leverage growth strategy only works if they can continue to grow organically and then lever that growth for increased returns. I'd be really surprised if we didn't get a terrific number for OCF this Q.

      • 1 Reply to unkulunkulu
      • Looks like pretty good numbers overall. I calculate a current EV of about 8x annualized OCF. Net debt/OCF of 3.9 times. At a similar EV/OCF valuation next year, 15% OCF growth and 600 million of FCF for the next four quarters gives a market cap of 19.9 billion which is a 30% return absent any acquisitions or buybacks. Doing either of those would compound those returns.

        Overall, I'm pleased. They did warn that they'd miss their revenue and subscriber addition targets for the year though.

 
LBTYA
46.79+0.02(+0.05%)Jan 23 4:00 PMEST

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