Definitely, E! After I read the Vanity Fair article it seemed apparent to me that Mr. Ackman had not done sufficient due diligence. So great entertainment.
I am sorry for your pain. I hope you rebound and can create another multiple choice where most of the answers represent monetarily rewarding outcomes.
It is worth reading the Vanity Fair article on Valeant/Pearson/Ackman. What seems clear to me is that Mr. Ackman understood VRX much less well than he should have. To have invested billions of $s and to have missed just how much the entire business model depended on just jacking up drug prices would make any savvy investor run away from Pershing Square. It will be interesting to see if he and Mr. Pappa can save the company.
If you visit the Antero website the characterization of the acquired acreage is "core" or "heart" of the Marcellus. Their press release is effusive about the quality of the acreage.
That was the price paid to CHK, $5 billion for 413,000 acres in the Marcellus. So in June 2016 SWN sold 55,500 acres in the Marcellus to Antero for $450 million or $8,181 an acre. So a drop of 33%. Hmmm? All acreage is not created equal but maybe the rough math works?? 33% haircut for balance sheet protection?? What I know about spudding wells is zilch... just running a calculator.
The rise in oil prices without a rise in ng prices is problematic for SWN because rigs seeking oil will come back on stream and produce some ng "by mistake" keeping ng prices at unprofitable levels.
By "not understanding" I look at the last 6 months correlation with LC. Why is it so strong??.... they both have Lending in the name????.... but one is really an internet oriented advertising company with growing revenues and significant profits while the other is a broken piece of FinTech that has serious funding issues and is staring at a huge q2 loss.
You may be correct on the 2 or 3 hedge fund theory, but unwinding short positions when 60% of the float is short can be painful and I can't quite get my head around how the end game will be profitable.
Mr. Lebda did a good job on the show. He sounded convinced that the business is good and getting better. I guess he exercised about 5k options and TREE is buying back shares. It is hard to reconcile the excellent q4 2015 report and the outstanding q1 2016 report with the stock price. Seems like many people do not understand the company. I don't think Cramer has full picture. One part of the interview that seemed out of place was talking politics and bringing up Lebda's previous support of Carson and now Trump. It didn't make me think ill or better of TREE, just seemed like a part of conversation that didn't fit the show or the viewer's needs. Bizarre Cramerism???
So VRX acquired Isuprel and Nitropress in 2015. According to Today's WSJ, they then raised the prices by 525% and 212%. Now, under changes effective immediately again according to the journal hospitals will be "eligible for a rebate of at least 10% but up to 40% based on volume... So my thinking is that the prices will still be up between ~475% and ~200% on Isuprel and between ~190% and 120% on Nitropress. Very generous of Valeant??????
But the problem confronting LC is the lack of investment/lenders. Prepare for a huge drop in LC revenue over the next 6 to 12 months. Not good. I am not a shareholder but I am an LC lender and I just turned off the automated investment feature in hopes of higher rates later.
I asked a pretty savvy investment advisor to take a look at the huge short interest situation in TREE last evening. His thoughts revolved around a number of possibilities. 1. Fear of a new competitor (Google, Amazon, or other big scale), I did notice that Well Fargo which I guess is about a 10% customer for TREE is launching a small business Fintech operation for some of their existing customers. 2. Whispered insider issues (he thinks highly unlikely) 3. A way for hedge funds to bet against higher interest rates at low cost, 4. A general hedge against Fintech.
Personally, I like #3 and maybe #4 although i don't think either issue represents long term problem for TREE.
Ok. But what is the bear case that has caused the huge short interest. I see good revenue and income growth despite the problems of the peer to peer lenders. What am I missing?
It is a different business from Lending Club but all of Fintech is being tarred with same brush.
CEO still owns about 17% of the company so he wants TREE to do well and he has put together a great business. Lending Club, Prosper, and Ondeck are all customers of TREE (and they all have funding issues)... and maybe they make up 5% of TREE revenue as a wild #$%$ guess... so there is some correlation but it shouldn't be quite as big at the recent price action indicates.
Last quarter TREE repurchased about $40 million is stock at $69 a share average. I just listened to the CFO's presentation at the Suntrust conference. My take is that TREE welcomes the opportunity to buyback more shares at these prices so Doug Lebda may be smiling. TREE issued a million shares at $115 in November. To be able to buyback shares at this price is a gift to TREE. Mr. Lebda also sold 100,000 of his shares at $115 tangental to that November offering. Hmm? Maybe he will also be a buyer, now?
So, I am a long time Lending Club lender. I have avoided the stock because it has been overpriced and there are scalability problems if loan losses mount. I think TREE will be a winner in the space. Lending Club gets some leads through the TREE platform. While there exists some correlation between loan originations and TREE versus Lending Club, Prosper, and On Deck they are in a different segment from TREE. I agree the market incorrectly tends to lump TREE with the others. Solution: Buy more TREE!!? It is on sale.
I don't agree that $13 is over any reasonable valuation (just on the high side), but agree on equity raise. It is always interesting when oil is up and ng is down, yet SWN (which is 99% gas) is up big. SWN reacts to oil???
The presentation on page 55 of the 10K is a little fuzzy. They actually marked up the value from 2014 when Career Builder was carried at ~$227 mm to ~$230 mm for 2015. MNI acknowledges a dividend from CB of $7.5 mm in 2015.
I think the accounting regulations say they have to mark down the stake if it falls below the carrying value. so given that they marked the stake upwards and the dividend looks like it is about 3%, my take would be to go with the $230mm value. I am not an accountant.... but I like looking at financial statements.