If you assume that revenue were 3/4% better than expected then it would be about 75mm better than the middle of guidance from the 1stq call. Most of this marginal revenue should drop to the bottom line or about 20 cents a share higher than current estimates. Higher earnings should lead to a higher P/E and move us back to the mid 50s in short order.
Longer term we should see more money flow into LOW P?E cyclical stocks as consumer staples and utilities
are well overvalued with record P/E ratios. and Bonds offer no yield at all. Airlines could double and still have value in this market.
AGN generic deal to close?
Every time I see another line sold the article seems to indicate that they will now be able to close and then a few days later i see another line has a buyer. Are we near the end or do we still have to trim current product lineup to please the regulators?
It feels like a year has already passed.
Why would someone wait until the last few seconds from the close on a Friday prior to a 3 day weekend to trade more than a normal days worth of volume? It looks to me as if a short were trying to make the stock fall thru to 50 day moving average. Next week will probably have thin trade across the board and this stock (normally thin trading) should be easy to kick around.
If they push it too hard I will add to positions.
Happy Independence Day
If you assume they issue $30 billion in bonds (to refinance bank debt) taken on to buy AGN generics unit, they should save nearly $300 a year in interest costs from the time the deal was announced. with current rates this low and corporate bond spreads still tight, I would expect a large refinancing bond deal soon after the unit is purchased in the next week or two. Interest savings alone should boost earnings about 30 cents a share higher than when the deal was first made public last year. The stock could easily go back to 70 for a 40% gain in the next year.
in at 49.4
I'm old enough and have seen many cycles where valuations seemed cheap but when the cycle turned the earnings vanished. This industry has changed, The airlines have been burned by over capacity time after time. Last week LUV announced that they are delaying delivery by several years on many of their jets, AAL and UAL have very tepid capacity increases. Earnings will shurley fall in the next downturn but we should not see the losses that have been experienced in past recessions. The industry has been repurchasing share and will probably soon increase dividends and not overextending capacity.
The airline market is priced as if we were already entering a recession. We havn't seen over capacity built in other industries and the housing sector is well under control in contrast to other economic cycle peaks.
Purchased shares last friday and again today.
"Based on quarter to date originations, the company expects loan originations in the second quarter of 2016 to be roughly one third lower than in the first quarter of 2016"
I thought it may be as law as one half. looking to add on the dip. Second quarter should be ugly. No telling how long to get back to earlier pace of loan origination. It will probably take another quarter for analyst to properly adjust expectations.
Russell rebalances its indexes each year on the last friday in June. Funds indexed to russell indexes must buy or sell shares based upon the the new make-up of the index. All of the airlines have repurchased a rather large share of their outstanding stock in the past year therefore index managers must SELL some of their shares to reflect the new weightings in the index. If the airlines repurchased 15% of their shares this past year and all else being equal then managers who try to match the index would have to sell 15% of their shares. If aal had 660mm shares outstanding last year and only 585mm shares (last reported) the decline would be 75mm shares. If russell index funds held 5% of outstanding shares (33mm shares) they would have to sell 3.75mm shares on the close.
Market makers and hedge funds know how many shares will be offered by index funds on the close and aftermarket. They will short shares earlier in the day and cover when the index funds have to dump their shares. This action may have contributed to the steady decline of the three major airlines today. all three airlines had several million shares trade at 16:13 (4:13 pm)
I have also seen in the past some of the issuers also purchase shares with their repurchase programs on reconstitution date. Lets hope that AAL was a buyer of 2mm shares at 27.04.
You also must consider average fleet age. AAL 10.9 years , delta 17 years, united air 13.8 years. The other airlines will be purchasing aircraft with their cash flow while AAL will pay down debt, repurchase shares and increase the dividend.
Mr, market is having a sale.
Thank You Mr. Market.
Do you think the company is buying stock hand over fist today? We are only a week from quarter end and the stock is at a 52 week low. Purchases at this level will look very good. If they buy early in the quarter and the stock drops then they look as if they have egg on their face. On the other hand, at quarter end is a no brainer.
I believe that we revisit the lows.
What do you think?
AND LOSSES OF 700MM IN THE LAST 12 MONTHS.
Bonds are starting to slide again.
Where is the value?
LC is a market leader in a growth market but has had a hiccup. Il looks as if the number of new loans continue to fall from last quarter and I believe that we will soon see another selloff but not new lows. The stock could see another 25% fall to about 3.75 prior to the next quarterly earnings report. I will reenter and expand the position with any fall below 4.
The overall market tooks long in the tooth and tired so I don't expect to miss much on the upside if I am wrong. The option makers were once again hard at work and drove this toward 5 where many options were outstanding.
I like this stock long term but believe that it is due for another setback. VRX has also had many false rallies each time it hit a new low this past year. I expect to be back in LC by mid-late July.
Did he just talk buyout to goose the stock to get a better price for his sale?
Falsified transactions in March and April so why not talk buyout in June.
Long and holding
Pitch to buyout firm.
1) I got no cash
2) I got no job
3) I want to run a financial firm and I just got fired for falsifying documents.
Charly Brown has a better chance of kicking that football with Lucy than this guy has leading a buyout.
Long and holding not betting on any buyout.
Too much long term value to sell anywhere near current levels.
Purchased 88% of position at 3.51 the other 12% at 4.83
Will add more if we trade lower.
"According to a PricewaterhouseCoopers (PwC) report, P2P platforms accounted for about $5.5 billion in loans in 2014. While this number is only a drop in the massive present-day banking ocean, PwC analysts project the market could balloon to $150 billion over the next decade."
Banks across the board are down about 4% and LC was down about the same amount. This stock has a beta about 3x the other financials and should have been down a lot more. The fact that it wasn't tells me that investors are taking advantage of the weakness to cover shorts or add to positions.
Purchased another 10% at 4.83
Fewer and fewer companies are entering the market thru initial public offerings. These companies always offer growth prospects for growth funds. The lack of new issuance will force these investors to purchase the few public companies that have above average growth. LC, despite their recent disclosures, still offers a growth profile much quicker than the average company. In addition, they are profitable and a market leader.
This stock could easily be back to their IPO price of 15 by year end and back to old highs by year end 2017.
Purchased shares at 3.51 as a quick trade but will now keep it as a long term investment. Expect to see near 7 by end of this month. By next Tuesday it should be clear that institutional investors have returned.
European Central Bank purchasing corporate bonds should also offer a boost. The lack of bond supply will lead to lower corporate bond rates and investors will look at loan products as an alternative.