There is a floor. Quarter was not that bad.
Q1 was negative $110 million ebitda. So that means q2-q4 will be $510 million. If Q1 were at Q2-Q4 levels that would be an annual run rate of say $650 million Ebitda. a generous 7 multiple to Ebitda would be 4.5 billion enterprice value. - $3 billion in debt that leaves $1.5 billion for common Share holders or about $10/share. Stock is 80% too high. I think $15-17 will be revisited.
They were Barclays and Merril lynch and it was yesterday. UBS downgraded to sell Friday before last 2.50 target as well. Saying there really is no long term business model.
That is a mega rally in the bonds. Stock still seems dumb though because how do they ever earn a billion to get book value back to Unch? Eventually a recesion hits and they are toast.
I mean i don't want to get filled at some dumb price like $37
If they have to roll their debt at 15% they could never hope to make a profit. Steel needs to be a phoenix of all phoenix for this stock to be a good buy at $5. Problem is US economy is growing slower and slower and so is the world. China or the US will likely have a recession of sorts by the time the debt comes due so this stock will likely be Zero. So why pay $4.8 for a stock today that will likely be close to Zero in the future. It should be trading around $3 right now max certainly not above $4. When you consider the 2020 price range of the stock is likely Zero or $8 max. So why pay more than the middle of that range now 4 years out?? This stock will fall back into $3's i do believe. If the economy was strong then there would be a chance. But its slow.
It seems we will run out of storage. we should be able to hit 4600+ if we have room for it. Then huge multi year Bull market will start in NOVember
Why did this analyst not like it? I shorted 175 premkt because the stock is not acting great premkt.
Free cash flow over $3 billion a year. They will pay back $6 billion in debt over next 2 years. Assuming Ebitda flat at $6 billion. 10 multiple (below average). $60 billion - $25 billion debt leaves $35 billion market cap. That is $100/share. Pretty simple.
They will pay down $6 billion in debt over next 2 years. down to $25 billion debt with $6 billion ebitda. The company will be worth $60 billion minus $25 billion or $35 billion in 2 years.. That is about $100/share
so instead of 1/2% maybe they end up paying 1% more interest. Doesn't matter much because it goes back to zero once the 10k is filed.