She stupidly forgets to mention that someone would be willing to pay full price for BABA through Yahoo and assume the tax liability. The $35 billion BABA gain and tax liability of $10 billion is not going away. Spinco will sell at a discount to NAV because of tax liability.
There was great confidence in continuing profit growth. Now $.20 cent annual rate and rising. Very confident in account opening product. Going to Europe as new legislation will allow Mobile Deposit. Channel partners like Fiserv already there. Felt like we are safe and secure with lots of growth coming.
Sentiment: Strong Buy
When you get your spinco, they will begin to sell stock and pay tax as they diversify. You can do nothing about that and holding in tax free account does you no good. They should have spun out baba to shareholders. Mistake
Said 2015 $45MM of EBITDA so selling for only 10x. That is very cheap for double digit revenue growth. Finally it is in buying range. ORBC will be a big company. It is scooping up some very good acquisitions that are also accretive. This will be a triple over next 3 years.
The VIE structure will surface again and BABA stock will be under pressure. As a shareholder, you own nothing but a contract to share in profits. In addition, the Communist China government has stated that that they do not approve of the contract. Pretty big leap of faith at 100x times earnings. Also try to get your share of the profits payable in Yuan and convertible as approved by China. The Hong kong exchange passed up billions is fees and would not allow the listing. I guess we and the lawyers know more than them.
They appear to be unwilling to lower yields on new business. There is plenty of business. I agree they need more volume and more growth. That us why the stock is down from $27. If they lower threshold yields than capital would get deployed.
Last quarter was $5.5MM and $.06 non-gaap. This is not a seasonal business. This quarter could be a big upside surprise and non-gaap could be $.09 or $.36 annual rate. Litigation expense will still be $500,000. Revenues could begin to grow much faster as they raise per check fees. A 2 cent increase is 20% increase in revs. Account opening may get some traction. Drivers license recognition is a huge market, bigger than check. As the company begins to get serious traction in non-check, they will look for a suitor. My guess we will get Fiserv stock at $12/shr. Any body selling here is misguided.
Sentiment: Strong Buy
They are financing short term just to boost profits when long rates are at historic lows. When rates rise they will be severely squeezed as leases do not adjust. The Portnoys do not care as thye get there fees no matter what. AVOID,
Sentiment: Strong Sell
Tangible book value is $14 and growing at an 8% rate on the current portfolio. Yield is 2.9% with dividend growth at 20%. As they deploy their excess capital, earnings could increase 80% without any new equity or debt. They have been slow to deploy capital instead being careful with credit. Marlin would be a great acquisition for a major regional bank who wants to get into the leasing business. It will be purchased at 2x BV in 2017 at a price of $36. The current 1.25 TBV price is as low as the stock has been in 3 years. Earnings are very stable as lease portfolio does not change much and interest rates are fixed. What makes Marlin so desirable is that it has a bank charter and the cost funds is .7%. They can also outbid banks for deposits as interest rates spreads are almost triple the average bank spread. This is a unique company and occasionally get cheap as it is pretty illiquid. Great buy at $17.50.
Also dilution from tangible notes is 7.8mm shares. They will have to face the bankers in Q1 with a writeoff. The acquisition will have to written down to FMV. Perhaps a $200mm or $5-6 per shares. Double ouch.
PV of cash flows makes it worth very little. We need a building boom to get value up which is not happening. Canola LLC now in default and they need tp pump in more cash. Horrible!!
Dollar will not be strong forever. When it turns will they give JNJ a beat for currency gains? JNJ is historically cheap on P/CF and PE and will raise Div next quarter. At midpoint of 2015, selling at 15.9x earnings with 11% ROA and 25% ROE. This is a great blue chip to own and yields almost 3% with.little downside in slowing economy. There are so many computers selling and buying stocks it is hard to tell the real price anymore.
BTW-- Bob Stine the old CEO milked this for several million before leaving and got nowhere. He saddled it with $80MM of debt, no income, and no future plan. It should be valued at $800/acre or $10/shr. At that price it would still be 30x earnings. Any hope of appreciation is siphoned off by inside management through options.
Sentiment: Strong Sell
Admire your effort but this is dead money for years. Wind gen is over as Federal subsidy expired. Oil has dropped so wind is not economic. Pop growth is overestimated. Water seems to be big issues and try and build without entitlements. It is losing money. It is a hobby ranch at best.