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EZCORP, Inc. Message Board

  • makea_bayn makea_bayn Feb 7, 2014 12:04 PM Flag

    Proxy Statement filed to raise AS to 100m from 55.5m

    Sorry will not let me post the link but I will copy the content: (Still watching this not in)

    At the meeting, stockholders will consider and vote on a proposal to amend our Certificate of Incorporation to increase the number of authorized shares of Class A Non-Voting Common Stock from 55,550,000 shares to 100,000,000 shares. The Board of Directors has approved, and recommends that you adopt, this amendment in order provide us with additional authorized but unissued shares of Class A Non-Voting Common Stock that may be used to support our growth and to provide adequate flexibility for future financings and other corporate needs. Details of the proposal are described in the accompanying proxy statement, which you are urged to read thoroughly

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    • Yeah, this is a minor technical item, but my attitude remains "Vote 'NO' on anything and everything we get a chance to vote on until management shows some friendliness to owners." And I think management is looking at it that way too--an insignificant vote to judge how fed up we are.

      I keep saying this: a dime a year of dividend and an elected non-voting board member. (A short chairman's statement every other CC wouldn't necessarily hurt, either) Watch it jump.

    • Wonder how many shares were issued and used at much higher prices to do deals that the seller has taken big lumps on. This should mean all the deals done at much higher prices make this stock look really cheap?

    • Makea_bayn,

      This is not an issue to be concerned with. Standard operating practice is to increase authorized shares in large lumps so that management doesn't need to constantly seek approval on a yearly or bi-annual basis.

      The long term record shows that outstanding shares tend to increase between 4 and 5 percent annually while revenues are increasing at 20% annually. It's a decent tradeoff for shareholders.

      To describe the predicament of EZPW, I'll use the analogy of an automobile driver who has found himself unable to control his vehicle going 100 mph. He smashed into pylons, other cars, and ran over pedestrians. Onlookers decided he didn't know how to drive. However, this is not true. Once the driver slowed down the car to 50 mph he was able to control the vehicle and get from A to B without misadventure.

      This is where the management of EZPW is at. They have slowed down the car so that they can control it. They have purposefully curtailed growth in order to regain their emotional composure and put into place formulas and infrastructure that ensure growth is safe and not destructive.

      The share price says, "These bums can't drive, period." I'm a buyer at current prices because I think they can drive, but only at reasonable speeds. Will the driver one day be able to safely navigate the car at higher speeds? Maybe, but I don't need that to be true to make money at current levels.

      • 1 Reply to t_e_n_k_a_y
      • This was only for an informative post. I am still on the sidelines with this one as there were some other items that concerned me in their earnings and conference call. However by third quarter they may be able to turn those around. Thus its definitely on watch -- for me though it isn't quite there yet to be attractive. Yesterday was interesting movement but then saw somewhat of a pump article/mention out on it last night on twitter which explained the movement on such low volume. I wasn't here when it dipped to 10.80s - that may have been a different story. Support being at the $10.71 level.

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