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C&J Energy Services, Ltd. Message Board

  • floridaguy4fun876 floridaguy4fun876 Nov 1, 2012 10:04 AM Flag

    Buyout Only chance for tue Value

    this is a joke. I wish I had a Billion in spare change cause this is a no brainer buy out candidate with the extremely positive cash flow CJES has. Let me give you some quick numbers and see if you dont agree. Lets be conservative and Call EBITDA $1.25 per quarter on Average. The stock trades at call it 20 bucks. With 1.25 in positive cash flow or 5 bucks a year you could buy this company and it pays for itself in 4 freakin years. THAT IS INSANE. A smart investment banker could borrow 75% or call it 750 Mill, put down 250 mill. so in this scenario this investment banker is basically buying CJES for 250 Mill and using the EBITDA of 5 bucks a year to pay the otehr 750 mill financed in 3 Years. You can buy a billion dollar company for 250 mill and own it outright free n clear in 3 years. Now this is somewhat unrealistic so lets say a buyout warrants a 25% premium to todays price. Now you are basically still paying 250 Mill but it takes you 4 years instead of 3 to own it outright. That assumes no growth whtsoever. Add in a meager 10% growth rate and also the potential for stock appreciation over the next four years and this investment banker could own a 2 Billion (stock goes to 40)dollar company for 250 Mill and pay it in 4 years and with continued growth have the stock potentially appreciate to fair value after the acquisition to a 40 dollar stock. With growth and stock appreciation Joe Investment banker could not only pull this deal off but he could ride positive cash flow while paying the debt and with stock appreciation do a secondary and pay off the note early and cost him even less cause say the stock hits 30 n he does a secondary of 8 million shares and raises 240 mill to pay down the debt he incurred to buy the company in the first place. This is also assuming the Term on the note he takes out is only 4 years which we all know anyone doing this would want to do like a 10 year note or something so now Joe investment banker truly has major positive cash flow and is going to steal this Money printing company for 250 Million bucks and over a 10 year period more likely than not sell enough shares to prob pay off 75% or so of the outstanding note. THIS IS TOTALLY CRAZY, if i can run these numbers quick and they look that good dont you think someone else who actually has the wherewithall to do this will to? It will be bought I promise you this and it is sad cause at a 25% premium whoever buys it is stealing it and I am jealous cause I want to raise the money and steal it myself.

    Sentiment: Strong Buy

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