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Strategies & Market Trends : Value Investing
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To: Spekulatius who wrote (66711)2/28/2021 5:36:38 PM
From: Madharry1 Recommendation

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E_K_S

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I was trying to make it simple for petal re baba. now for the gang here is the puzzle: what do we do with EBIX?
cpa firm resigned citing two issues, both of which on the surface seem to be no big deal. the company reported a huge volume increase in indian gift card sales but despite the large revenue growth it contributes almost nothing to the bottom line. so why is that so material that the cpa frm chose to resign. issue no. 2 was $30 million in cash that is held in trust in conjunction with some possible acquisition. the company wants to list it as cash. the cpa firm wants it listed as other current assets. the other issue is that the company waited 5 days after receiving the letter to publicly announce it. On the face of it neither of these issues to me seem big enough to merit a cpa resignation. Someone on a different thread speculated that the cpa firm resigned because of concern that the gift card usage might be linked to some illegal activity that the cpa firm wanted no connection to so they bailed. Perhaps the CPA firm got cold feet because EBIX is planning an ipo including this india gift card unit and they got cold feet fearing they might get sued by investors if the ipo blows up. .

What say you petal et al? on the surface looking at the numbers this seems like a cheap stock now by almost any standards, they need to find a new cpa firm willing to take them on and hope that there isnt a lot more fire to this smoke.
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