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Strategies & Market Trends : Value Investing
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To: Paul Senior who wrote (63553)3/27/2020 3:42:30 PM
From: Nya_Quy  Read Replies (1) of 78782
 
TLRD. Was also wondering. Maybe it's all in the financials as with cash flow projections or something. Nya_Qua laid out a case for the company, but I couldn't see it (comprehend it).
You are very warm, Paul! The trick is looking at the company in terms of its free cash flows (i.e. also treating leases as any other kind of interest-bearing debt). This reveals the company is having no problems in term of being cash flow positive, but rather in terms of using the generated amounts of cash. In an normal business environment TLRD should be able to be making more than $300 mln in unlevered FCF, or about $100 mln in normalized levered FCF (lease payments are already subtracted from this amount). Current market cap is about the same as the levered FCF. All FCFs figures are given after-tax.

With regard to the current use of capital by the company. It has already eliminated dividend payments in favor of debt reduction and share buybacks. Noteworthy also is TLRD's recent sale of its Joseph Abbouds trademarks for cash, while simultaneously entering into an exclusive licensing agreement with the buyer.

-- Nya --

P.S. Yesterday, or so, Burry filed another 13-D stating he has increased his stake to about 8% of total outstanding shares.
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