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Emmis Communications Corp. Message Board

  • nhlabman nhlabman Jan 11, 2011 5:18 PM Flag

    If EMMS is so wonderful - then buy it..

    pump and dump, lack of finl sophistication, etc.

    I have no axe to grind and have made good money in radio, including EMMS.

    The company is highly levered, and that doesn't even include the preferred stock. It generates extremely little free cash flow and certainly not enough to pay down the bank debt. That is why the company has announced all stations are for sale.

    If the company violates the bank covenants in 9/11 and hasn't sold any assets, it will be in deep trouble. The bank interest rate will skyrocket from the current 5.6% level and interest expense will further destroy any free cash flow.

    The company is drastically overleveraged and only an asset sale at a high price can save them.

    They have done it before, but I wouldn't want to bet on that today.

    It might happen, but it might not. You are not playing with the odds in your favor. You are speculating.

    You want to make money in radio - buy SGA.

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    • >> You are not playing with the odds in your favor.

      Actually, you ARE playing with the odds in your favor. Some people just don't know that...because they haven't done their homework.

      It amazes me, the ability for the Street to IGNORE relevant public information to valuing a company. Few greater invalidations exits, of the useless "efficient market theory" than the valuation of EMMS last month. Not because there have not been more drastic examples of undervaluation (there have been)...but because of the significant amount of public information that was available to red flag that undervaluation.

    • I do in fact own a considerable number of Emmis shares, but I would never recommend that anyone buy (or sell) any stock based on the comments that are made on the Yahoo! boards.

    • speculating? aren't most stocks under $1 a gamble? Did you take into consideration the CEO just tried to buy the company for 3x the current value? What does he see that you don't? Loans can be renegotiated. It happens daily in the business world. Look at Sirius last year. I made a fortune on that gamble. I also doubt the CEO will risk losing the majority of his shares to a BK.

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