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The Active Network, Inc. Message Board

betasplen1 105 posts  |  Last Activity: 7 hours ago Member since: Mar 2, 2004
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  • betasplen1 betasplen1 7 hours ago Flag

    Granted it looks bad on paper. Stock has fallen 50%. But they are earning $6MM per year. Give 22% of that away, make nothing in return for the cash they just got and that is still 4.68M or the market cap right now! If they buy a distressed silver or gold mine (small window for purchase) and get higher returns, then it is all OK. I think there is a followup PR coming shortly..

  • betasplen1 betasplen1 10 hours ago Flag

    I have no doubt they are in the red for that portion. But more than made up by the remaining 82% from their earnings report.

  • betasplen1 betasplen1 11 hours ago Flag

    Maybe guys like 7777 are making hay while the sun shines. Better to claim that they made huge profits shorting and covering at the lows than to be squeezed and getting picked on later. He is quiet lately. Or maybe I am giving him too much credit and his ego will eventually get the better of him...

  • betasplen1 betasplen1 11 hours ago Flag

    omega, I think you misread the existing 18% deal. They are not giving away 18% of their profits currently. They are just giving 18% of their total production at a discounted price of 75 cents per pound to Anglo Asia. In other words, Anglo Asia is a customer that gets preferential pricing for part of their production. The remaining 82% is being sold at market rates. But the new agreement is 22% of their total profits. It will only make sense if they are using the money for some immediate opportunity that yields more than 22% to the bottom line. We may find out about that opportunity soon enough as it makes no sense otherwise to get funding at such a steep price, when they are a very profitable company already.

  • Reply to

    Institutional Holdings 6/30/14

    by betasplen1 Aug 19, 2014 3:00 PM
    betasplen1 betasplen1 11 hours ago Flag

    I forgot to include one more holdings update as of Jul 10:

    Blackrock Inc.: 1,374,907 shares

  • betasplen1 betasplen1 12 hours ago Flag

    Exercise price of $5.62. So, the 3M options is worth zilch right now. But it can be exercised only a year from now and that too only a third of it. If he can do a turnaround like TMUS and get this to $12 by then, then those options are worth almost $20M in a year. Not too shabby, even for a billionaire

  • Reply to

    Borrowed More Money to Average Down to $0.97

    by quickkeeping1 Aug 15, 2014 9:38 AM
    betasplen1 betasplen1 12 hours ago Flag

    Quick, I know there are many characters who post these kind of sad stories to jeer the longs of any company that has fallen to oblivion. They get a sort of sick entertainment by doing so. Perhaps that is why you are not getting much sympathy that you might expect here. Since you have been at it for 2 months, maybe you are telling the truth. I can't guarantee anything like Southi, but there is a decent chance that you can breakeven (or even make a small profit!) on a short squeeze, especially if they get more than the street expects for their schools or if there is a merger/buyout or if they keep operating as a 10 campus FP school after the sale or if the DE becomes more lenient due to political and public pressure. Finally, there are 24M short shares that might actually save you when all is said and done. See my earlier posts. I don't believe in pumping and try to look at things based on facts or technical indicators. 97 cents may feel like the sky right now but on Wall street, it is just another 80 cents! My personal target is 85 cents.

  • betasplen1 betasplen1 Aug 19, 2014 5:30 PM Flag

    Absurd market cap. Only twice the cash they just received and a PE of 1 Sheesh!.

  • Here's the update on the top 10 holders after the bad news (when everyone thought they are going BK) but before the deal with the DE (which pretty much eliminated BK risk). Net 2MM shares added in 2Q14 and 25MM shares held by the top 10. Remember that over 100MM shares traded between the release of the news on 6/19/14 and 6/30/14. If they didn't sell then, chances are, they are still holding after the deal with the DE. Coincidentally, that amount is equal to the shorted shares as of 7/31/14. The squeeze could be dramatic since retail has already sold and these big boys will not let go for cheap IMO...

    Owner Name Date Shared Held Change (Shares) Change (%) Value (in 1,000s)
    SHAH CAPITAL MANAGEMENT 06/30/2014 8,277,040 2,302,466 38.54 1,299
    DIMENSIONAL FUND ADVISORS LP 06/30/2014 3,323,518 (83,855) (2.46) 522
    FMR LLC 06/30/2014 3,069,800 (530,200) (14.73) 482
    VANGUARD GROUP INC 06/30/2014 2,440,764 25,820 1.07 383
    CREDIT SUISSE AG/ 06/30/2014 2,220,537 1,287,240 137.92 349
    NANTAHALA CAPITAL MANAGEMENT, LLC 06/30/2014 1,400,000 1,400,000 New 220
    BARCLAYS GLOBAL INVESTORS UK HOLDINGS LTD 06/30/2014 1,364,484 (759,154) (35.75) 214
    EUCLIDEAN TECHNOLOGIES MANAGEMENT, LLC 06/30/2014 1,103,439 (1,590,174) (59.04) 173
    RUANE, CUNNIFF & GOLDFARB INC 06/30/2014 1,000,000 0 0.00 157

  • betasplen1 betasplen1 Aug 19, 2014 1:44 PM Flag

    Unless management saw an opportunity that will yield more than 22% to the bottom line if they act right now with the extra funding. And in that case, it was a leverage move. In any case, this should be trading at 40 cents and not a penny. Not sure what's going on here.

  • betasplen1 betasplen1 Aug 19, 2014 1:40 PM Flag

    I understand not wanting to dilute shares by 33% and hence going this route. But the royalties in perpetuity is quite steep at 22%. I understand they are a customer as well but not sure why they agreed to that, especially if revenues are climbing exponentially. Also, if they are profitable, why take on the additional financing? But the hacking today of 40% when the company was already grossly undervalued is crazy. Buying at a penny...

  • Reply to

    Rumor mill grinding

    by betasplen1 Aug 18, 2014 9:47 AM
    betasplen1 betasplen1 Aug 19, 2014 10:46 AM Flag

    While we are talking hypothetical and totally discounting the rumor, why will EDMC need money to propose a merger? They can simply issue stock in the new company, which will be the aggregate of the revised COCO valuation and EDMC. Also, unlike telecom, the govt would want consolidation in this space so that they can watch the fewer institutions like a hawk. They will just require both EDMC and COCO to remedy any outstanding data requests and to fix any non-compliance as part of the merger approval.

  • Reply to

    Rumor mill grinding

    by betasplen1 Aug 18, 2014 9:47 AM
    betasplen1 betasplen1 Aug 18, 2014 10:10 AM Flag

    Not that I place much importance on merger rumors, but even if they just try to merge as equals, what will COCO's valuation be? If you go by revenue and assume that EDMC is fairly valued at $1.60/share, COCO should then be valued at $1.40/share. This is just one of the many scenarios that could play out between now and December. If most of the retail has sold, who is going to sell to balance the demand from short covering, and that too 24M shares? It's a dangerous game to play when you think your opponent is down and you turn your back on him in the 12th round to soak in the applause......

  • betasplen1 by betasplen1 Aug 18, 2014 9:47 AM Flag

    In company news, Education Management Corp ( EDMC ) was sharply higher Friday amid renewed Internet chatter the for-profit educator could be looking to merge in today's tough market environment for the sector and increased regulatory scrutiny.

    In particular, some investors today were on Internet chat boards for EDMC citing a SE Group report from earlier this week speculating the company and Corinthian Colleges ( COCO ) could likely merge.

    COCO this week said it received a grand jury subpoena seeking records including student-loan defaults and job placements. The for-profit chain last month said it was putting 85 locations up for sale as it tries to remain above water.

    EDMC shares were up slightly more than 23% in late Friday trade at $1.57 apiece. The stock slid to an all-time low of $1.12 last Tuesday, Aug. 12. COCO was down nearly 11% shortly before the close today at 15 cents a share.

  • betasplen1 by betasplen1 Aug 15, 2014 4:36 PM Flag

    at 16:10 EST at 0.149. Wonder what that's about...

  • Reply to

    EDMC and COCO

    by southi25 Aug 15, 2014 3:17 PM
    betasplen1 betasplen1 Aug 15, 2014 3:48 PM Flag

    You believe that blonde in Sierra World Equity Review? She has called a few correctly before but it is just a guess at this time. No point getting anyone excited about it. How can they even be allowed to merge when there is this huge albatross around each institution's neck? EDMC is running today for some reason though..

  • Reply to

    Thought for the day

    by betasplen1 Aug 15, 2014 10:57 AM
    betasplen1 betasplen1 Aug 15, 2014 12:10 PM Flag

    That is possible too. But I am not too greedy (like the shorts from the dollar range are right now) and will most probably be looking for the next candidate at that time...

  • Reply to

    Thought for the day

    by betasplen1 Aug 15, 2014 10:57 AM
    betasplen1 betasplen1 Aug 15, 2014 11:46 AM Flag

    jd, I am biased of course but I wouldn't hold such a large position if I thought they will go BK before the sale. I can't predict the near term, but I see 40s first (where I'll sell half) and then 80s (sell the rest) before the final valuation is decided by the market. I will not be holding past Dec. So I expect to see those targets in the next 4-5 months. But to be complete in my analysis of the situation, I need to consider a BK situation as well if the DE withholds funds again for some inexplicable reason. In that case, I plan to double up in the single digits and exit at breakeven in the ensuing short covering to the teens...

  • betasplen1 by betasplen1 Aug 15, 2014 10:57 AM Flag

    An investment (or a gamble if you want to call it that) in COCO does not have to be seen as a value proposition based on how much they will get for their schools after debt repayment. It is hard to guess as the estimates have a wide range. The discount due to the tarnished image is subjective and buyers know if they don't buy, someone else will and enjoy the economy of scale. But that is besides the point.

    The huge short position in of itself is enough to take this to 48 cents at least. That is where it went on the first bounce, after the news of the financial woes. Turns out, only 4MM shares covered in the first round and a lot of ammo (24M) is still left. The banks have $140M at stake here. The govt has invested billions over the years. There are over 70K student and 12k employees. The govt is not going to let the company die and destroy so many people's lives in the process. The Republican's will be all over the administration like flies on #$%$. The DE will keep using the withdrawal of Title IV funding as a threat to make sure COCO submits the required paperwork they have been asking for a year, even if it won't provide the incriminating evidence they so desperately seek. However, they won't exercise it since they know the company is in dire straits without it and cannot complete the sale in an orderly fashion under the independent monitor's supervision. The banks will remain mum and wait it out as well, waiving any covenants that are being violated to get their money back or a large equity stake in the new, more nimble company.

    As long as the US Govt and the banks want an orderly sale to happen, there is no worry to COCO, other than it will be a smaller fraction of itself in the future. And COCO is operating business-as-usual in the meantime. As someone said, COCO might actually be better off (profitable) by being forcefully downsized. The math says 107-85-12 = 10.

  • Reply to


    by betasplen1 Aug 12, 2014 2:55 PM
    betasplen1 betasplen1 Aug 15, 2014 8:37 AM Flag

    I don't believe you responded to this.

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