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Poseidon Concepts Could Resurface
There is not a lot written on this stock and I picked it up from the John Mauldin newsletter. I was stung by this stock today and am trying to look at it from a valuation perspective. I am debating whether to cut my losses or dig in for a bit. At $1.50 the stock has an enterprise value of $173mm. That would imply 1.2x their recent guidance. They were at $116mm EBITDA year to date but are likely to miss the range of $140-$150mm given the dividend suspension and management changes. However, on a go forward basis this company would have to have EBITDA of around $43mm at a 4x EBITDA multiple to justify the current valuation. That would be much lower EBITDA than the $65mm it delivered even in 2011. I suppose anything is possible but with the insider buying it seems like this is a bit of a hot mess but maybe not yet headed for bankruptcy.
Dec 28, 2012. 03:38 AM
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