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  • Taxi Farebox Declines A Harder Hit To Medallion Owner Bottom Lines [View article]
    ff2017: "I'm not sure this Gene Friedman person's situation is all that bad."

    And yet, despite "substantial equity", he has had great difficulty getting someone to finance these medallions. It would be surprising if nobody comes to the rescue with so much supposed 'equity' supporting these medallions, but if nobody does, that is a pretty big statement from the rest of the taxi medallion lending industry of their views on medallion values.

    One need only look at what happened in Philadelphia when a number of new medallions were released for sale at the same time last fall (the first in 15 years.) Original asking price $475,000 which was described as around 'market' price at the time (45 medallions earmarked for handicapped accessible cabs in the fall of 2014.) There were no bidders. Actual sale of only 3 medallions THIS month at $80,000 (minimum sealed bid of $50,000 so don't expect to reach $80,000 again if the other 42 medallions are auctioned later by sealed bid.) The writing is already on the wall!

    http://bit.ly/1eaqzOu
    http://cbsloc.al/1eaqzOw
    http://bit.ly/1Fdrh7u
    May 18, 2015. 04:28 AM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    "the most experienced medallion lender in the world (with a 70-year record of zero losses) "

    This is not a true statement. TAXI has experienced medallion losses in the past. But it sounds nice though.
    Apr 21, 2015. 06:10 AM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mr. Meyers, MORE MISDIRECTION. You can't have it both ways. Either vehicles are empty and they can pick you up quickly (as in a street hail for a taxi or a rideshare waiting for an e-hail) or you wait for a pick up in either case because they are busy or there aren't enough around. To imply something positive because a street hail is so quick (meaning the cab was empty and driving around looking for a fair) and somehow something negative because a bunch of Ubers are standing at the ready on a Saturday night in Manhattan is wrong. The Uber equivalent of a taxi burning fuel and driving around looking for a hail is for an Uber to go to an area shown to be a likely high volume area (shown by the app.) and wait for an e-hail. Hey Mr. Meyers, I bet this might just result in lower fuel costs for an Uber driver! I'm surprised you never mentioned that!
    Apr 19, 2015. 12:39 AM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mr. Meyers, how does this after tax calculation you have done compare with your 10-12x Gross earnings per medallion in annual debt service. More blatant misdirection??? Kinda like comparing peppercorns to watermelons isn't it? Why don't you also deduct the money he sends his grand kids on their birthdays and pays for Mars Bars as well? It would surely make the number look smaller?
    Apr 16, 2015. 11:35 PM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mellar, when interest rates rise due to Fed tightening and perception that medallions are a riskier asset, won't this impact debt service coverage ratio and cause prices to fall if lease rates don't also rise? We can both agree that your 1.25x assumption is a far cry from Mr. Meyers assertion that the average medallion earns 10-12x annual debt service each year.
    Apr 16, 2015. 01:01 AM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mr. Meyers, Do you mean someone either buying out or bailing out Friedman's medallions? Woohoo! You seem to be jumping up and down because a catastrophic crisis might be averted? Again, with so much uncertainty out there, why be long? What would have to happen for you not to be Long?
    Apr 16, 2015. 12:38 AM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Sorry Mellar, I see you are referring to 725k for a minifleet of 2 medallions and not one. My bad.
    Apr 15, 2015. 10:04 PM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mellar, I agree anything is possible but you are talking about turning the tides on a very strong set of circumstances. Why would you remain so adamantly long in the face of so many difficult hurdles?
    Apr 15, 2015. 10:00 PM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mellar, if Friedman can't refinance 87 medallions at an average of $362k, why do you think financing purchases of medallions purchased at $725k "would be a breeze?" Maybe if you click your red shoes together and wish it so three times it may happen!
    Apr 15, 2015. 09:48 PM | 2 Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Larry Meyers comment: "...the average medallion earns 10-12x annual debt service each year....not counting lease fees from other drivers that the owner leases to."

    Again Mr. Meyers, you should consider getting a book on finance and lending practices. "earn" implies net income and not gross revenues. I have never seen a lender look at a multiple of gross revenues to debt service. The lenders are concerned with what is left to pay the debt.

    A medallion only "earns" the fee associated with what it would cost to use it which has been stated to be about US$3,000/month (and dropping.) Sums coming in above this are from the driver's labor and would have to offset his expenses (gas, etc.) An owner/operator can still drive a cab without owning a medallion by leasing one from someone else. Then he doesn’t have to use the rent money, grocery money, school money, personal car payment money, gas money, etc, to keep paying off a loan on a falling asset if it becomes severely underwater with an unlikely prospect to recover. If you look properly at what the MEDALLION "earns" (vs. a someone who drives a cab and also has an INVESTMENT in a medallion) it is the gross incomings (currently around $36,000/year) that would need to support whatever debt the owner has outstanding and provide a return on his or her capital. Lease rates have been falling and interest rates are more likely going up than down over the next year so you quoting 10-12x cash flow coverage over debt service is truly the kind of "misdirection campaign" you have accused the "shorts" of making.

    As an example, a $600,000 loan at 5% would attract $30,000 in interest alone let alone principal amortization SO LOOKING MORE LIKE A 1x RATHER THAN THE 10-12x AS YOU SUGGEST. Your pooling in the return to labor along with the return on a medallion is a trick and has little to no use as an analytic tool in these circumstances but continues to be one of the many elements of your misdirection campaign. Why are you so wed to your position in the face of an overwhelming tide of events that have pointed toward a looming problem? (dropping medallion prices, dropping lease rates, possible large foreclosure of medallions, etc. etc. etc.) I can understand someone not going short in these circumstances but to continue to emphatically PROMOTE a long position with a 50% upside to the readers who may rely on this misdirection is worrisome to say the least.
    Apr 15, 2015. 11:48 AM | 1 Like Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mr. Meyers, he is describing a 'term' loan. When a term loan is due, you have to pay the the entire outstanding balance or refinance. You don't just get to keep paying the monthly payments as before the term is up unless the lender allows you to (called a refinancing.) Perhaps you should get a book to brush up on how lending works.
    Apr 14, 2015. 12:27 PM | 3 Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mr. Myers, I certainly understand how assets are sold in a foreclosure. Perhaps you should talk to a few lenders to figure how this usually works. Unlike your suggestion that TAXI will buy them, I'm pretty sure Citi has no interest in owning 87 medallions (they don't even want to lend on them, why would they want to own them?) Nor does NYCB. Citi will sell at the market. They will hope to sell at an AVERAGE of $362,000. Maybe they stop selling if medallions get this low, maybe they don't if they think that it isn't going to get any better.

    I would consider myself a "not long" on TAXI. If they buy these medallions, I would seriously consider a short if the price doesn't collapse on the news alone.
    Apr 14, 2015. 11:50 AM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mr. Meyers, I'm sure Citi would be happy to sell for an average price of $362,000 if they are allowed to proceed with their foreclosure. Maybe you can broker such a transaction with Taxi?
    Apr 14, 2015. 11:39 AM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Yes Mr. Meyers, and that has really slowed the growth and penetration of Uber, Lyft, et. al....not!
    Apr 14, 2015. 11:36 AM | Likes Like |Link to Comment
  • For Medallion Financial, The Future Is Arriving [View article]
    Mr. Meyers, are you seriously suggesting that the way for TAXI save the market is to buy 87 medallions at $362,000 each if nobody else wants them? Will you stop at nothing to try to support a position that the steady stream of facts has shown to be less and less likely (like your $15 magical and unsubstantiated price target?) Based on this logic you should give up journalism and go to Las Vegas and keep doubling your bets until you eventually win. It is foolproof as long as you don't run out of money first.
    Apr 14, 2015. 11:00 AM | Likes Like |Link to Comment
COMMENTS STATS
66 Comments
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