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OneBeacon Insurance Group, Ltd. Message Board

sage533 6 posts  |  Last Activity: Jan 28, 2016 4:21 PM Member since: Dec 4, 2001
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  • They have $26MM of gross profit before overhead and R&D. If someone acquired MITK, they would add $26MM to profit. They could easily pay $260 million or 10 x times earnings. That is very cheap for 30% growth. Add in $27mm of cash and you get $9/shr. The new products are free.

    MITK is ramping revenue with 65% more employees vs last year. R&D is up 32%. When the new products get traction, the company will be diversified and command a much higher PE. I do not think earnings matter that much right now as the company is concentrating on growth. They did not have to add 31 new employees in sales. The are managing earnings at BE to get the most leverage while adding to cash.

    Unfortunately DeBello is not the best manager. He does not communicate his plan well and has no idea how to manage growth and earnings at the same time. He does have good a BOD who have advised him to go for growth and the home run.

    Hard to believe the stock sold off 10% but then again we have a new group of owners who have little idea of what they really own. I think we will finish the year at $7.

    Sentiment: Strong Buy

  • sage533 by sage533 Jan 28, 2016 9:48 AM Flag

    Whoops they forgot to pay down the debt. They instead bought companies at the top of the cycle. With declining cash flow and no prospect of recovery for several years, the balance sheet could be strained. Day rates are declining. Buying back stock is the kiss of death for these gamblers. Earnings will decline every quarter for the next 4 years.

    Sentiment: Strong Sell

  • This has turned into an oil stock. Sales in the Dakotas will decline as people leave the area. What is the deal with the vitamin stores? That business is dead. We will probably have several quarters of negative earnings. Stock head to $45.

    Sentiment: Sell

  • Coal loadings down 37%, metals down 25%. Only thing up is autos but car loadings down 11% overall in Q4. IBM hits skids as does some other big holdings. BV will be down in Q4 and Q1. PCP will turn out to be bust as airplane orders evaporate. BRKA will underperform S&P500 from here on out. Too bad.

  • sage533 sage533 Jan 8, 2016 9:47 AM Flag

    MITK to be acquired. Will be in talks this year. Buyout price $12.

    Sentiment: Strong Buy

  • sage533 by sage533 Nov 20, 2015 9:54 AM Flag

    At 16x earnings and 25% growth in revenues and 30% in earnings, it is the cheapest stock owned. Mitek has a 5 year window to grow without competition and with modest price increases as it prepares for sale. The new products add significant value. Mgt says the new products have more potential than Mobile Deposit. Mobile Deposit has a lock on the market because of MySnap which is unique to them and patent protected. It is the key to client retention.

    They also have the ability to price the product based on bank avoided cost. The avoided cost of a check is $3-5/check as acknowledged by the industry. Fiserv charges $.40 --that will not last. My estimate is Mitek has the ability to make $1.20/shr or $37MM in earnings as it ramps. Most of that is tax free covered by their NOL.

    Thornton and mgt. will sell the company at $25/shr but that is only $750MM. It could bring more. We are now waiting for the new PR firm to get the story out to the investment community. No one really follows the company but that is about to change. The estimate will be $.35/shr for the next 12 mos.

    Sentiment: Strong Buy

OB
13.39+0.24(+1.83%)11:40 AMEST