This is a hot space with Visa and Mastercard. GE's private label credit card does the consumer finance and credit card for Walmart, #$%$ Lenscrafters, AMAZON and hundreds of other retailers. Earned $2B AFTER TAX last year.
This is pretty much as B. Riley had telegraphed. Interesting item is $5.3mm of "unearned revenue" on balance sheet, which means that this is revenue which has already been paid for by the customer, but will be taken by the company as revenue in the future. Good sign as it means sales # should start ramping up next Q and then really move ahead in Q3, as guided by the company.
This quarter (to be reported tomorrow) and the quarter after that will be relatively soft; however the new contracts and backlog growth should show very strong growth for the rest of 2014 and 2015. My hunch is that they will strongly reaffirm that in the conference call tomorrow, while also reinforcing the dividend payment.
Make you a deal. If the price is over $8 at the close next Friday you never will post on this board again under this ID-mary5connelly59
If the price is Under $8 I will never post on this board again under swank818. Deal??
Even if it is not a deal you can lick my feet for being wrong if the price is over $8 at the close on Friday.
The IPO is being sold directly to the public by GE, so GE gets the cash and whomever buys the shares on the IPO owns the 20% of the company, which will have $50 BILLION in assets. Then in 2015 GE will try to do a tax-free exchange offering current GE shareholders the option to convert their GE stock into the Consumer Finance/Credit Card stock at a ratio reflecting both their prices on the open market, with a probable slight discount. This will spin out the other 80% and have the secondary effect of reducing GE shares outstanding (like a buyback but instead of using cash they will be using the Consumer Finance Co. as their currency.) It is expected that this will reduce GE' share count enough so that the loss of the Consumer Finance earnings will not impact GE's EPS and may even help it since the Consumer Finance Co. will probably go at a much higher multiple (see Visa, Mastercard etc.)
Also, it will make many institutional investors happy as GECC will then be less than 30% of GE and revert back to what it was originally designed to do....finance GE's customers' purchase of GE industrial equipment.
This combined with the 30 year bond issue today shows that GE is serious about generating more value for shareholders.
This will be a hot IPO...see if you can get some from your broker. They will IPO 20% and then "spin" the other 80% next year.
The market has very little patience for stocks that don't perform TODAY. EVOL has a dominant position in a decent-sized market and they have had good contract wins and their backlog is starting to grow. Last quarter and the one that they will report next week (in my opinion) are not very impressive for those who need their daily fix; however starting with the next quarter and thereafter that backlog should begin to translate into impressive revenue growth and VERY impressive earnings growth (given their huge margins and high leverage.) In the meantime, at these prices, you get paid 4.5% to wait.
However, the simple answer to your question is that their earnings performance last quarter (and probably the one they report next week) is relatively unimpressive, and Mr. Market is in a NOW mode...not a mañana mode.
Only explanation unless this is a 6th grader who likes to post during his recess??
2-3 cents for Q1 with flat revenues Q to Q, and basically a DOWN year in EPS (even with share buybacks).
However, IF the marketing efforts and backlog come through then just after the 2nd Q earnings report will be a good time to get this at the right price and ride a nice uptick through 2015. However, with the Nasdaq ripping ahead and no one knowing what the market will look like in a year, very few investors will stomach the "wait till next year" line and I expect this to trade down to $3.50 or so in the next 2-3 weeks (difficult for people to trade out of a large position, so it will be a lurch today, to around $4.25-$.30 and then a slow bleed. Was one of my favorite stocks and hope it will again be, but why ride it down when it will be a while coming back. However, if you are the kind of investor who puts your certificates away in a safe deposit box and comes back to look at them in 5 years, this should do OK.
Current exchange value of what the offer was for SIRI. Basically each $1 that LMCA rises adds about 2.5 cents to the exchange value for SIRI. If Liberty gets to $158 then SIRI's exchange value is $4
This should be a hot little company as Visa, Mastercard, Paypal are sporting huge multiples. GE's private label credit card does Walmart and carries over $30 billion in balances. They have about a 65% market share in the private label credit card business.
Do YOU understand the exchange ratio and its implications for the stock's value. Most on this board think the offer is $3.68 NOTTT That was only the value for the exchange on the day the offer was made. Since then Liberty stock has dropped from $145 down to $129. For each $1 move in LMCA, it equates to a .02533 change in the value of the offer. Not derogatory, just facts.
However, it would appear that there are many numb-nuts on this board who don't have a clue and will be squeaking and squawking until either the deal closes or is broken. If they go up 10% (most one could assume) then it will be ,0836 divided by 3 which is .02787 times $129.60 (or whatever the LMCA price is when the deal closes) = $3.61 when the shares are converted.
That is why he exhibits OCD with regard to EVOL postings.
Wrong....deal will happen. "Independent" committee will negotiate a raise from .02533 to .0279 and declare that they have won a huge victory for shareholders and sign on the dotted line. IB will bless the valuation and then overnight you will own Liberty stock.
Raised 10% that would be $3.59 bagholders.
Current value of the Liberty offer. If they raise it 10% (probably maximum) then = $3.64 = DEAD MONEY
All of you amateur arbitrageurs should pack up and buy CDs before I will have to be supporting you in your old age when you are sitting on a curb eating dogfood.
They will make a product that initially looks like an iPhone out of foreskins and when you massage it the product will expand to an iPad and if you keep massaging it, the product will become a 40 inch TV.
I don't seek BK, but I also don't see much upside for shareholders given the huge anchor of debt, which impacts their total value much more than moves in their share price. The only thing that will really improve their share price is if they begin to show meaningful revenue increases (like 15% annual rate for 3 or 4 quarters). Till then this is dead money