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ITT Educational Services Inc. Message Board

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  • aaatiles aaatiles Sep 3, 2008 1:29 PM Flag

    Advising against a Short position and a note to the company's Board and Executives

    Sadly, ESI doesn't have the available cash to buy back anymore treasury shares, which is why they stopped doing so in February. At 6-30-08, I think they had something like $220 million in cash (not exactly sure right off the top of my head), of which something like $157 million was restricted as collateral on the $150 million outstanding loan. And considering that ESI has started internally funding revenue due to the disappearance of the sub-prime lenders, it resulted in something like a negative $40 million cash flow from operations during the second quarter 2008. Cash has been shrinking for the past two years. Two more quarters similar to 2Q08 and I believe this company will have no available cash to spend, unless management comes up with a new plan.

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    • AATILES there you go again. Your post is below. My comments are in CAPITAL LETTERS. You really have no clue. I am going to sit back and continue to make a killing enjoying the gradual increase in this stock's price. Keep up your posts. Maybe they will drive down the price temporarily and create more buying opportunities.

      Your post and my comments:

      Sadly, ESI doesn't have the available cash to buy back anymore treasury shares, which is why they stopped doing so in February. At 6-30-08, I think they had something like $220 million in cash (not exactly sure right off the top of my head), of which something like $157 million was restricted as collateral on the $150 million outstanding loan. And considering that ESI has started internally funding revenue due to the disappearance of the sub-prime lenders, WHERE IS THE DATA TO SUPPORT THIS? HAVE YOU LISTENED TO THE CONFERENCE CALLS? it resulted in something like a negative $40 million cash flow from operations during the second quarter 2008. THIS IS DUE TO A REDUCTION IN CURRENT LIABILITIES- THIS HAS NOTHING TO DO WITH SUBPRIME. THEY AVERAGE $40 MILLION PER QUARTER IN CASH FLOW FROM OPERATIONS. Cash has been shrinking for the past two years. SHRINKING DUE TO STOCK BUY BACKS. Two more quarters similar to 2Q08 and I believe this company will have no available cash to spend, AGAIN YOU ARE COMPLETELY WRONG unless management comes up with a new plan.

 
ESI
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