JCOM has enough cash. So what is the purpose of additional 250 million @ 8% due 2022?
Major acquisition is probably coming as revenue and EPS growth seems to have stagnated.
Mr. Peterson, whatever you did or did not do for shareholders of LodgeNet.
Stock moving up on June 15th, your last day as CEO does speak itself of your performance.
How could they let this company go so cheap and then make a mockery of shareholders by saying that this deal is in the best interest of shareholders?
Apparently the board is stealing the company from helpless shareholders and selling it cheap to the buyers at ridiculously low price. They have not done due diligence or I am missing something.
And then our smartypants CEO Trudy Sullivan...What happened to all those promises to shareholders at these quarterly conference calls? She along with other executives and these so called reputed (but do-nothing) directors were paid huge salaries and compensation to do what...drag the value of company down and down and...then sell it cheap.
Is CEO and others are being promised jobs by the buyers? I hope not.
Once again SHAME to those on the board if sale goes through at $2.75/share.
This was the first quarter warrants are in the money. For transparency all derivatives/liablities ets have to be marked to market each quarter. Hence loss on warrants issued to Berkshire are required to be reported on both balance sheet and income statement (I believe).
Every dollar increase in BAC stock would a $700 million loss to BAC. So Berkshire Hathaway gain on warrants on 3/30/12 has to be reported as loss to BAC.
We should see that in the detailed financial statements.
What do others think?
Probably touch $8 tomorrow when numbers are not as good as some on this board are hoping for.
Few more hours before earnings...
Berkshire Hathaway Inc. owns 700 million warrants on Bank of America (BAC) common stock with exercise price of $7.14 per share,
BAC closed at $9.57 on 3/30/2012
Berkshire's gain on warrants = 700 million x ($9.57 - $7.14) = $1,701 million.
With 10.73 billion BAC shares outstanding, this gain to Berkshire translates to a loss of about 16 cents/share(before-tax)for BAC.
This loss could be a partial explanation of lowered earning estimates for BAC by some analysts.
But next quarter earnings numbers need to be watched carefully now.
Revised expectations of management for diluted earnings are 8 to 9 cents, significantly less than 13 cents estimate by analysts.
We may soon see some downward revisions.
Hence lower stock price today as expected.
Expected gains for Q4 moved to Q3. Hence the results show 18 cents per share EPS as compared to 13 cents expected by analysts in Q3. Management lowered consensus estimate for Q4 at 8 to 9 cents per share (from 13 cents expected by analysts for Q4 as it appears on Yahoo finance).
So it appears that what is gained in Q3 (5 cents = 18 -13) is expected to be lost in Q4.
So what will be markets reaction when it opens after this news.
Here is info cut from earnings announcement....
>>>>>1) What are your revenue and net income projections for the fourth quarter of fiscal year 2012?
For the fourth quarter, we are projecting that revenues will be slightly higher than the $68.1 million realized in the fourth quarter last year. We are projecting that diluted earnings per share for the fourth quarter of fiscal year 2012 will be approximately $0.08 to $0.09 per share. As mentioned above, we expect for the full year that revenues will grow 9% to 10% and that net income will grow approximately 40%, after adding back the one-time impairment charge of $4.8 million to net income for fiscal year 2011.
The increase in net income during the third quarter and the decrease in net income in the fourth quarter compared to our prior guidance are due to the timing of the recording of the change in the fair market value of our investment in Windset. Based on a recent appraisal of Windset it was determined that the change in the fair market value of our investment for fiscal year 2012 will be $5.8 million. In addition, based on the appraisal, it was determined that $4.7 million of the $5.8 million should be recorded for the nine months ended February 26, 2012, which resulted in $3.5 million being recorded in the third quarter and the remaining $1.1 million to be recorded in the fourth quarter of fiscal year 2012. In our prior guidance, we had assumed that the majority of the annual fair market value adjustment would occur in the fourth quarter not the third quarter of fiscal year 2012. Operationally, Windset is ahead of its plan for the twelve months ended May 27, 2012 and this improved performance will be reflected in the $5.8 million change in the fair market value of our investment for fiscal year 2012.<<<<<<
And what will be impact of dilution due to additional 47 million shares.
The conversion price is very attractive at $6.374 per share when the current price of common stock is around $11.80.
How will it change balace sheet and income statement?
Absence of preferred dividend will cut expenses but the additional 47 million shares will result in huge dilution in future earnings.
How will the difference...($11.80 - $6.374) X 47 million shares = around $255 million adjustment affect the balance sheet.
And then we should not forget any valuation reserves of deferred tax assets that would be moved to the back from reserves to books.
Any response will be welcome.
Watch for EPS estimates..
They are being lowered as you see on Yahoo finance earning estimates.
How far these estimates will be loweed from the current levels would be important signal for stock decline to stop.
Also there has not been any insiders buying...or stock buyback announcement by firm (Is there any?).
What are they waiting for?
Perhaps a better (lower) entry point!
What about lower future earnings forecast?
What happens when analysts cut thie estimates down to reflect management's lowered diluted EPS numbers?
Same thing happened to Denny's ...ticker..DENN.
Denny's this quarter created Deferred tax assets on balance sheet(reduction in valuation reserves for deferred tax assets).
Stock went up on earnings announcement but has come down after that announcement.
I agree that retail investors are likely to be confused buy this shuffling of assets like deferred tax assets.
Confusion creates uncertainty and unexpected price moves and thus opportunities for some.
Could the management's remark about just 21 to 24 cents per share diluted share be the reason for KKD's decline?
Here is what management said in recent report....
.... Management estimates diluted EPS for fiscal 2013 will be in the range of $0.21 to $0.24; this range reflects an estimated tax rate of 45% compared to management's earlier estimate of 6-7%. The higher tax rate is a result of the reversal of valuation allowances on deferred tax assets in the fourth quarter of fiscal 2012 as more fully discussed below; the amount of taxes expected to be paid in cash, which is insignificant, is unchanged from prior estimates....
Could this be the reason?
This stinker smells more and more every day...
And the management seems to be unaware of it.
What good are the patents when no body seems to be paying anything for this technologies.
Shareholders are frustrated with the lousy results management has reported so far....declining sales every quarter...consuming firm's cash in management salaries for doing nothing.
Why don't they sell the company to someone who can manage the company well.
I hope management brings something positive this quarter!!!
God bless ERII.
Adjusted taxable income before taxes = $9.5 million
Taxes (avg of last two quarters) = $0.407 million
After Tax Income = $9.5 - $0.407 = $9.093 million
Weighted Avg. Number of shares outstanding = 96.188 million
Earning per share = $9.093 / 96.188 = $0.09453
So excluding the effect of tax benefits....
Denny's earned slightly more than 9 cents per share which beats the 8 cents per share analysts' consensus estimate.
Am I missing something?