Anant Vijay

Revlon's Debt Will Lead The Share Price Higher

Revlon (NYSE:REV) recently underwent a fairly taxing privatization case with the SEC. After the company settled with a fine, investors re-assessed their view and the stock treaded higher. The company currently trades at a P/E ratio of approximately 33x, up from an average of 14x over the last five years. The ratio was depressed, in part, of the large debt burden on Revlon's sheets. As of March 28, 2013, Revlon had net debt of approximately $1.16 bn (in contrast with a market cap of $1.18 bn). My idea for the article came to me when I noticed how badly the market was undervaluing the company in comparison to some of its closest peers and the overall fundamentals of...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
WITH SEEKING ALPHA PRO, INVESTORS CAN ALSO:
  • Access Top Ideas, chosen by Seeking Alpha’s editors
  • Filter long and short ideas by market cap and sector
  • Get Coverage of over 5,000 stocks, many of which have little or no coverage elsewhere
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO." Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else." Patrick Rice, Mainstay Capital Management
100% Satisfaction Guaranteed
Money back guarantee. Seeking Alpha PRO members receive a no-questions-asked refund for membership on months paid and not used. Details