Thanks for response.
Wasn't sure how you were coming up with shares OS, but with this much stock out there, it does become confusing.
It appears, contrary to popular belief, that Ferguson intends to go through with reverse stock split based on his comments in conference call.
I thought they made as good a case as possible about how 4th quarter improved over the year. However, I was a little disappointed that they didn't give more insite into how the 1st quarter was going. Did you pick up on anything.
""By the way, number of outstanding shares at 12/31 were reported at 235.4mm with an additional 46.9mm to be issued as part of litigation settlement.""
Yes of course thanks again. I've been trying to work on CXW numbers on an absolute level versus a per share level as I own the pref. stock.
The CC was interesting, none of the old regulars, every analyst has dropped the company. I'm sure the new fellows are a bit confused about that.
I'd certainly love to see how they do with there assets sales, this will be the story of the industry. With places like CA City costing $100mm to build there're certainly assets, whether they are worth anything to another buyer..hmmmm.
Bone-head politicians should start feeling the budget pinch. No more pork barrell prison projects it looks like. Eat _____ Gov. Davis, looks like you'll be getting the tar and feathering you deserve. Maybe next time you won't sleep through Business 101. hahahaha
Thanks for your response. I agree we are guessing, but always watching to see if others see something I don't.
By the way, number of outstanding shares at 12/31 were reported at 235.4mm with an additional 46.9mm to be issued as part of litigation settlement.
One important bit of info on the CC is CXW is in compliance of their bank covenents. That's good to hear.
If CXW is able to cut $200mm off their debt it would lop $30mm in interest off their yearly bill. With 17% operating margins, which they have been for awhile it's all the interest expense game.
WHC's G and A expense runs 4% of gross Rev., for CXW that would be $36mm so $44mm is not far off. ($46*365*54,500 beds*.04)
Assuming a "normal" interest rate on the remaining $900mm in debt of say $6.5% would put a $58.5mm interest rate bill to them. cash flow/shr. would be $165mm(operating profit)-$36mm G&A-$58.5mm interest expense=$70mm profit. Based on 165mm shares out that's $.42/cash flow/shr. I can dream can't I?
""Is it likely that G&A for 4th quarter is uncommonally overstated for the 4th quarter since it likely included settlement of employment agreements with Doc, Darrell and others. ""
Good point. The 3rd quarter figures for private CCA give almost no supporting detail so it would be a wild guess on my part which probably not safe to do. Needless to say with near 90% occupancy they could be cash flow positive it appears.
stockmavin4, as usual, has a good eye for value, I agree with him the pref A is the best play here(or bonds), IMO. I have not decided if I'm going to add or not.
The reverse split is coming soon on what looks like a total of 165mm shares. A rights offering makes clear sense along with asset sales if possible. I own some CPV and they have had little luck selling their Jena, LA facility as it's empty and WHC pays full rent on it. WHC would love to get rid of it and LA. I wonder how much luck CXW could have....but I guess at the right price anything can be bought.
If all these good things are coming along on plan then the cash flow will become positive within six months. \The immediate purchase of the pfd A at $7 that comes with the $2 accrued dividend is a easy safe play. Especially as the accruals increase $2 per year or 16.6 cents per month. At a $7 purchase less $2 accrued is $5 adjusted cost. Going forward you have an expected increase of 3 % per month in the accruals alone.(3% times $5=15 cents.
When the company gets on its feet and proves it can "rent" all their beds during the year 2001, then a $2 per year dividend payor pfd stock with a $25 face value will sell at a much higher price than $7. Actually adjusted price is $7 less $2 accrued or $5 at present.
reverse indicator I get a loss.
Rev.$310.2....oper/G&A/lease (238.4)=$71.8..interest expense($131.5)=($59.7)...not including one time charges.
Don't forget 46mm shares for shareholder settlement too.