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American Capital Agency Corp. Message Board

eagledragon1 55 posts  |  Last Activity: May 17, 2016 2:33 PM Member since: Feb 8, 2008
  • eagledragon1 eagledragon1 Apr 28, 2016 8:14 PM Flag

    It was announced on April 30th last year..............

  • eagledragon1 by eagledragon1 Apr 28, 2016 3:02 PM Flag

    Credit Suisse analyst Stephen #$%$ points out that the sudden spike in this line item over the past two quarters indicates that Amazon Prime growth is accelerating. But as a result the company's shipping costs could have increased more than expected, thus pressuring its gross margins.

    "Netnet, we believe the acceleration in growth of this line item in 3Q15 ? likely as a result of Prime Day in #$%$ly 2015 ? and the continued strength in 4Q15 indicate that Amazon is more rapidly driving Prime adoption," #$%$ writes. "There is a near-term impact to gross margin due to a step-up in Prime shipping costs that we believe is often overlooked."

    If nothing else, this growth in Prime membership will push Amazon to make the ATSG collaboration a success.

  • Reply to

    4 years from now.

    by cal_doon Apr 13, 2016 8:34 PM
    eagledragon1 eagledragon1 Apr 16, 2016 11:27 AM Flag

    Time to start a pool. I'll take 2018 on the offer, closing 2019.

  • eagledragon1 eagledragon1 Apr 13, 2016 12:31 PM Flag

    Depends on cost of capital? Please explain.

    They said they will be spending 215 million in capex for this year. They announced the expected schedule of deliveries during the CC. They also expect to raise the leverage on the debt ration up to 2.5 from well below 2.

    It's obvious you're going to blindly follow and question nothing. That's your right of course. But when you post erroneous information, I'm gonna jump on you.

  • eagledragon1 eagledragon1 Apr 13, 2016 11:40 AM Flag

    Wrong. 1. Amazon will not be exercising any options until after ATSG's shareholder meeting next month at the earliest.

    2. So what if you think that Hete thinks ATSG will be above 15? Would seem smart?? For every share ATSG repurchases for say 14 and sells to Amazon to help satisfy the warrant, they lose 4.27 per share. The shares would have to ride well north of 18 before they could even hope to break even on that part of the deal. In the meanwhile, the loss they suffer on a share repurchase is directly removed from capex funding. That means more of a draw on borrowed funds, more money going to interest payments. For the amount of shares they might be contemplating to repurchase, the affect on reducing dilution would be extremely minimal.

  • Reply to

    Possible merger?

    by j157272 Apr 8, 2016 1:20 PM
    eagledragon1 eagledragon1 Apr 11, 2016 3:53 PM Flag

    Do a little research on them and you can find some unsavory dealings in their past. Combined with the fact that they launch this proposal based on a total of 11,000 shares of ownership tells me more than I need to know. No how, no way.

  • Reply to

    Proxy vote

    by eagledragon1 Apr 6, 2016 4:31 PM
    eagledragon1 eagledragon1 Apr 11, 2016 12:05 PM Flag

    Then let them fully explain their philosophy on this matter. Quint honestly did a miserable job of explaining the ramifications during the question and answer portion of the CC. Now we have proxy proposals that again incorporate the same type of generalities that were offered in the CC. I am not the only one wanting more details, this is why you see proposal 6. When it comes to business it is foolish to implicitly trust that management always works on behalf of the shareholders.

  • Reply to

    Proxy vote

    by eagledragon1 Apr 6, 2016 4:31 PM
    eagledragon1 eagledragon1 Apr 11, 2016 11:44 AM Flag

    The whole point is that ATSG would be repurchasing shares at higher prices and selling them to Amazon at a significantly LOWER price. This does not make sense. Better ATSG simply raises the overall corporate share count to accommodate the Amazon deal. Better to suffer the added share dilution and add to book value and available capital than continue the share repurchase program and create a negative equity "offering" that would do very little in alleviating EPS dilution.

  • Reply to

    Proxy vote

    by eagledragon1 Apr 6, 2016 4:31 PM
    eagledragon1 eagledragon1 Apr 8, 2016 11:05 AM Flag

    There are several provisions that exceed the boundaries of what is necessary to satisfy the Amazon investment. There is considerable discomfort concerning these provisions. I am very much opposed to continuing the share repurchase program. Why? The company is going to repurchase shares at 13, 14, or more per share so they can sell them to Amazon for 9.73?? The saving in dilutive affects is far smaller than the net loss of capital.

    There will be no approval of props 4 through 6 from this arena.

  • eagledragon1 by eagledragon1 Apr 6, 2016 4:31 PM Flag

    Please read proposals 4 through 6 very carefully.

  • eagledragon1 eagledragon1 Mar 29, 2016 2:11 PM Flag

    Though there is not a large group of analysts, the numbers being forecast going forward are likely driving the share price. The estimate average from 5 analysts for this year (2016) is for earnings of .63/share. The average estimate from 4 analysts for next year (2017) is for earnings of .90/share. This represents an increase of over 42% in per share earnings. The average P/E ratio for the trailing 12 months is 24.9 which is actually more in line with the industry average of 23.9 (air freight and logistics). IF earnings estimates happen to pan out and the P/E stays fairly static, the share price by the end of 2017 would be in the area of 22.40. That would be a 45% increase in share price from 15.40.

    Granted, these are estimates by analysts and how well they have incorporated capex expenditure and share dilution through exercising of warrants is somewhat of an unknown. However, these are the numbers as posted today (Fidelity research).

  • Reply to

    Why Amazon will eventually buy out ATSG

    by eagledragon1 Mar 28, 2016 12:26 PM
    eagledragon1 eagledragon1 Mar 28, 2016 1:31 PM Flag

    Acquiring the warrant deal is nothing but a prelude to a possible buy out. These warrants allow them 20% ownership at a significant discount to current share price estimates. It also allows them more leverage with THEIR shareholders in offering to buy out the remaining 80%. The warrants also offer a measure of dilution that will help maintain the share price to minimal ranges until they are ready to make a final decision.

    It is important to remember that 5 years is not written in stone concerning these warrants. Anywhere along the way the terms and conditions of these warrants may be amended if properly approved. They may be amended as part of the terms of a buy out. I believe Amazon will be ready to move well before 5 years passes. At that time I’m expecting a request to amend the warrant terms and an offer north of 20 dollars per share for the remaining 80%. At this point it is all up to ATSG to deliver. I’m betting they will.

  • Amazon has simple goals in teaming up with ATSG. Cutting costs and increasing efficiency are these goals. Having a gateway into China is the icing on the cake. The current window covering 5 years will allow Amazon to thoroughly learn the business, including complete transparency to all operations through the addition of a BoD observer and eventual member.

    Amazon is starting this endeavor with 20 aircraft. If the goals Amazon is looking for can be attained, there is no reason to believe this fleet will not be increased as time goes on. For Amazon this is just a beginning, not a total solution. The advantages of Amazon outright owning ATSG are pretty impressive:

    1. A further reduction of in house air freight costs as paying a profit to another party is eliminated.

    2. Further offset of expense from the profits generated by the other business ATSG currently employs.

    3. Operational savings from several directions such as varied insurance coverage, etc. that could be supplied by vendors under the Amazon umbrella.

    4. More control of operational efficiency in respect to Amazon’s internal logistical operations.

    5. A solid base from which to launch an international network.

    ALL of this could be accomplished without changing basic day to day operations or current personnel. It would just be a matter of buying the shareholders out. Amazon is taking a very intelligent approach concerning its interest in ATSG. They want to LEARN the business, be a fly on the wall, not just jump in with both feet. These people don’t jump, they R & D everything to the Nth degree.

  • eagledragon1 eagledragon1 Mar 22, 2016 5:39 PM Flag

    I already have everything in life that I want and need, thanks anyway. But good for Amazon!

  • eagledragon1 eagledragon1 Mar 21, 2016 2:39 PM Flag

    Last day of March is the end of Q1. So dilution won't occur in Q1. If Amazon held off till July 1st, Q2 would see no dilution either. So Q1 EPS should only be affected by capex expenditures.

    Never have I seen so many news wire articles flat wrong...

  • eagledragon1 eagledragon1 Mar 21, 2016 1:38 PM Flag

    It appears..... all the news wires erroneously reported that Amazon had indeed acquired a 9.99% stake. I never bothered reading the 13D filing myself because I honestly didn't think that many reporting services could get it wrong. However, after reading the 13D myself I noticed that the terms for exercising the warrants were different than what ATSG had outlined in their 8-K! If I remember correctly, the first tranch of 9.99% was available to exercise upon signing of the initial agreement (which is reported as March 8th).

    Go read the 13D filed by Amazon and it appears to indicate the first tranch is not available until between after the shareholders meeting and July 8th.

  • Something strange going on here.

  • eagledragon1 by eagledragon1 Mar 21, 2016 12:20 PM Flag

    Here is what we are looking at concerning Q1 estimates:

    As of this posting the Q1 estimate is earnings of .14 per share. With the new share count as dictated by the recent 9.99% Amazon warrant acquisition, this gives an estimated net income of 10 million.

    Net income for Q4 2015 came in at 14.8 million. The Q1 estimate represents an almost 1/3 drop in net income which likely takes into account the increased capex as ATSG keeps ramping up operations ahead of accounts receivable.

    Book value has increased approximately .40 per share due to the Amazon warrant purchase. It currently stands around 6.16 and will increase with Q1 earnings.

    Cash flow due to the Amazon warrant purchase increased by just over 69 million.

    One year target estimates have been upgraded to just over 15 dollars per share as of this posting.

  • eagledragon1 eagledragon1 Mar 20, 2016 1:38 PM Flag

    You're so emphatic that I would expect you can prove it. Do so.

  • Reply to


    by ex14142000 Mar 19, 2016 12:26 PM
    eagledragon1 eagledragon1 Mar 19, 2016 12:50 PM Flag

    and book value moved from 5.76 to ~ 6.16.

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