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Corrections Corporation of America Message Board

  • GenJackripper GenJackripper Jan 10, 1999 12:02 AM Flag

    For those interested in more accurate da

    than that currently being reported by Yahoo re:
    PZN's ADV and Market Capitalization, I will endeavor to
    provide same.

    Market Guide furnishes the subject
    data to Yahoo-Finance for reporting on this
    site.
    Due to the 1/01/99 merger of "old" CCA with PZN, it
    may take MG weeks to more accurately reflect the M-C
    for PZN and perhaps 3 months to reflect a more
    accurate ADV.

    The reason for the M-C being wrong is
    that MG's computers are still multiplying the stock's
    price by the shares PZN had outstanding prior to its
    merger with CCA.
    Why it might take them as much as
    perhaps a month to rectify that, I can't say, but it
    usually has.

    According to PZN's 3Q98 10-Q (filed
    11/17/98), as of 10/31/98, PZN reported 21,945,569 shares
    outstanding (s/o).

    CCA's documented record of shares
    outstanding is more interesting, if less stable.

    In
    its 2Q98 10-Q, filed 9/29/98, it reports 80,523,735
    s/o as of 8/01/98.

    By the 11/16/98 filing of
    its 3Q98 10-Q, it reported s/o (as of 11/01/98) of
    84,214,275. How come 3,690,540 more s/o in just 3 months (an
    increase of 4.58%) some may wonder? The answer, of course,
    is that HSBC began its monthly purchases of CCA
    stock in September.

    If you tried to back into
    the s/o by taking the M-C, as reported here on Yahoo,
    and dividing it by the share's price, you would've
    been behind the times and in error. Through the week
    ending 11/20/98, the s/o number you would've backed into
    would've essentially been the one reported in the 2Q98's
    10-Q (a/o 8/01/99).

    Beginning with the week
    ending 11/27/98, MG adjusted its s/o multiplier upward,
    but, for the remaining 5 weeks of 1998, the average
    "backed into" s/o figure was still LESS THAN the s/o CCA
    reported in its 3Q98 10-Q (84,209,605 vs.
    84,214,275).

    In consideration of HSBC's continuing purchases
    through November and December, neither of those numbers
    was an accurate reflection of CCA's actual
    s/o.

    To be concluded in Part II.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • Per CCA, its s/o as of 12/31/98 stood at
      91,379,203 (while "backing into" s/o from Yahoo's reported
      M-C on 12/31/98 would've yielded
      84,198,582).

      Since I do not have PZN's comparable s/o as of
      12/31/99, but expect to have it, I will assume its 3Q98
      10-Q's reported 21,945,569 to be operative for
      12/31/99.

      Disregarding the fractional shares of PZN (on conversion of
      CCA shares) redeeemed for cash (and thereby retired),
      I have assumed that the "merged" PZN began 1999
      with 101,902,372 shares outstanding, calculated as
      follows:

      21,945,569 + 91,379,203 x 0.875 = 101,902,372.

      With
      that as a multiplier, PZN's M-C should
      be:

      $22.3125 x 101,902,372 = $2,273,696,675.

      That's
      #2,273.7 M versus the $489.7 M which Yahoo (per MG) is
      currently reporting.

      As RP has mentioned in #135,
      HSBC will be purchasing additional shares (on a
      monthly basis of $50 million per) throughout FY99 and
      FY00. The actual number of shares HSBC's $50 M will
      translate to depends on the average of that month's daily
      closing prices for PZN.

      If, for example, that
      averaged daily closing price for January's 20 trading days
      was to come to exactly $25.000 / share, PZN would
      issue HSBC 2,000,000 more shares and February's s/o
      would start out with ~103.9 million.

      PZN will be
      revising its s/o upward each month (for the next 2 years)
      and unless someone (@ PZN) notifies MG of this
      situation, they'll probably be at least a quarter behind in
      relavancy as far as M-C is concerned.

      With regard to
      ADV, if this were a simple matter of a stock split
      rather than a merger, it would still take MG 2 or 3
      weeks to make the correct adjustment, but since this IS
      a merger and since MG calcs the ADV by averaging,
      on a monthly basis, the prior 3 months of trading
      days, it'll take close to that long for its ADV to bear
      a semblance of reality to the post-merger
      ADV.

      Witness the fact that in its first 5 trading days since
      the merger, PZN has averaged 742,840 shares traded
      per day this past week.

      As of the end of the
      week on 12/31/98, PZN's ADV was reported here on Yahoo
      as 167,909 shares. Now it is reporting
      202,590.

      Looks like Part III will conclude.

      • 1 Reply to GenJackripper
      • Of what relevance is PZN's pre-merger ADV (when
        it had about a fifth of the post-merger's shares
        outstanding) to its trading activity since the merger? Not
        very much, IMO. But you'll have to wait the better
        part of 3 months until you can rely on what Yahoo is
        telling you.

        As a point of information to the many
        who did not attend Doc's Road Show, one of the
        criteria HSBC required for its equity participation was
        that the ADV, post-merger, had to be a minimum of
        500,000. It appears that PZN is off to a healthy start in
        meeting that condition.

        Since it is a matter of
        custom for me to maintain end-of-the-week statistical
        summaries, I will be calc'ing PZN's post-merger ADV and
        market cap. If there is any interest on the part of
        lurkers here, let me know and I will try to provide
        periodic data to keep these factors more currently
        accurate until Yahoo's reporting catches up with reality.

 
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