If the company pays back the $150 million due in September 2008, how much cash would they have left? Depends on how much they lose between now and then and how much they have after getting the $46m from Musiwave sale, right? Not having owned this stock in quite some time I don't know what they reported having last week but I can tell you this
there isn't a pile of cash in this puppy and it gets less and less everyday.
Notice I began with IF they pay back the debtholders in September. From having watched this company for almost six long hard years I say the probability of this company making good on the debt is like 50-50% which would make the common stock worth exactly $0/pps.
Yes they have cut back on expenses (they are in survival mode) but previous restructurings have netted dissappointing bottomline results.
What possible reasons can anyone give for being optimistic?
A sale? They just shopped it last Spring and came up with what? Selling Musiwave for $46m after paying over $120m two years earlier. Ouch. But it does give them cash to burn for what another 2,3, 4 quarters?
The long standing Chairman of the Board (Bernie Puckett) recently left because IMO he didn't want to be the last one to turn out the lights.
This stock rose from the ashes once from 2002 and many were surprised then. Is it a good bet to say that it will happen again? Each will decide for themselves but IMO they'd have to find a cash infusion which I don't believe they'll find.