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Strategies & Market Trends : Value Investing
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To: smaycs4 who wrote (50400)12/19/2012 2:10:37 PM
From: Spekulatius  Read Replies (1) of 78603
 
And today, they offically announced their Reorganization Plan Confirmed. My plan is to hold my shares for higher prices, while their prior book value was mostly wiped out by large losses in prior years, Their strategic plan calls for good cash flow going forward.


Now we are talking. As far as valuation is concerned, I would put your own multiple on pre tax EBIT or EBITDA (5x ?) and put in some value for the NOL (10% of nominal max, imo) and subtract the net debt (13M$ ?).

That will give you an estimate for the value of the company. To estimate the value of the stock, you need to know how many shares are going to be outstanding after the reorg. I have not seen any evidence of share issues to debtors or such, but I suspect that management is going to propose a large incentive share grant for themselves as a reward for their troubles.

STRZQ does look about fairly valued here. Keep in mind that this is just a plan and it is apparent that plans can go wrong, otherwise they would not be in the trouble they are finding themselves right now.
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