siddharth18 Posted August 6, 2014 Share Posted August 6, 2014 ebix the company that is supposed to be swimming in excess cash flow wants more borrowing capacity... ::) Yes they repaid their previous debt using the excess cash flow. Let's not forget that EBIX has paid out (in buybacks, dividends & acquisitions) more cash than it has taken in (via issuing equity/debt). They wouldn't have gotten the capacity if the (multiple) bankers weren't convinced of its cash generation ability - that is the point. The fact that they were able to open a new credit line despite the outstanding issues should tell you what the bankers (who have access to more information than shorts do) think about the outstanding issues. Link to comment Share on other sites More sharing options...
Scudbucket Posted August 7, 2014 Share Posted August 7, 2014 ebix the company that is supposed to be swimming in excess cash flow wants more borrowing capacity... ::) Yes they repaid their previous debt using the excess cash flow. Let's not forget that EBIX has paid out (in buybacks, dividends & acquisitions) more cash than it has taken in (via issuing equity/debt). They wouldn't have gotten the capacity if the (multiple) bankers weren't convinced of its cash generation ability - that is the point. The fact that they were able to open a new credit line despite the outstanding issues should tell you what the bankers (who have access to more information than shorts do) think about the outstanding issues. With respect... I don't have an opinion on EBIX, but I don't agree with the reasoning and implied conclusion, "The fact that they were able to open a new credit line despite the outstanding issues should tell you what the bankers (who have access to more information than shorts do) think about the outstanding issues." You have to remember that bankers are people, too. And they're susceptible to the same things as every investor. Also, consider how they're compensated; a lot of them need to meet quarterly sales targets. From what I gather from all the bankers I know - all in different regions - is that bankers are competing a lot more now so lending standards are decreasing, covenants are getting lighter, maturity is extending, features like PIK are picking up, etc... I would be careful to make such an assumption based off the fact they were able to get a loan. But, again, I don't know anything about EBIX... Link to comment Share on other sites More sharing options...
siddharth18 Posted August 7, 2014 Share Posted August 7, 2014 With respect... I don't have an opinion on EBIX, but I don't agree with the reasoning and implied conclusion, "The fact that they were able to open a new credit line despite the outstanding issues should tell you what the bankers (who have access to more information than shorts do) think about the outstanding issues." You have to remember that bankers are people, too. And they're susceptible to the same things as every investor. Also, consider how they're compensated; a lot of them need to meet quarterly sales targets. From what I gather from all the bankers I know - all in different regions - is that bankers are competing a lot more now so lending standards are decreasing, covenants are getting lighter, maturity is extending, features like PIK are picking up, etc... I would be careful to make such an assumption based off the fact they were able to get a loan. But, again, I don't know anything about EBIX... Ya I agree with you. I think lot of these facts that are emerging are ancillary data points and none of those individually prove or disprove if EBIX is what the shorts allege. However, I don't understand how this could at all be negative. In the same way as a bank severing a relationship with a company does not prove that the company is fraud, it's likely...in the same way - a bank creating a relationship in light of the allegation does not disprove fraud, but it's likely that it ain't a fraud. Link to comment Share on other sites More sharing options...
jouni1 Posted August 7, 2014 Share Posted August 7, 2014 i'm pretty sure enron had relations with banks. edit: just to clarify, i'm not saying ebix is a fraud, just that them getting a loan doesn't probably mean much. it probably isn't a fraud, and if it's all as good as they say it's probably a good investment too. Link to comment Share on other sites More sharing options...
FFHWatcher Posted August 20, 2014 Share Posted August 20, 2014 It is interesting going back 3 years or so when this thread was restarted. No time to read 80 pages but a few are interesting. Seems like Ebix is still moving fwd, plugging away but not acquiring as aggressively. Share price was $14. Still is. At some point it will hit it's true value. Not sure if that is $0 or $20. After 2011, it seems their revenue run rate did come in at about $200M but not a lot of change since then. Link to comment Share on other sites More sharing options...
mankap Posted August 25, 2014 Share Posted August 25, 2014 It would be interesting to watch Ebix over next 12 months.It is going to be a battle between the shorts and the company.At $80m, Ebix could buy back 5m shares. There are more than 16m shares shorted. Ebix Inc. Announces Intent to Repurchase $80 Million of Shares Over the Next 12 Months Link to comment Share on other sites More sharing options...
mankap Posted January 6, 2015 Share Posted January 6, 2015 Slowly the clouds are lifting over Ebix . Ebix has appointed 2 independent directors and now are done with the IRS audit Ebix Announces Resolution of IRS Audit Ebix, Inc. 34 minutes ago GlobeNewswire ATLANTA, Jan. 6, 2015 (GLOBE NEWSWIRE) -- Ebix, Inc. (EBIX), a leading international supplier of On-Demand software and E-commerce services to the insurance, financial and healthcare industries, today announced that it has reached a resolution with the Internal Revenue Service with respect to the previously disclosed audit of Ebix's income tax returns for the taxable years 2008 through 2012. The assessment relates solely to non-recurring issues associated with certain acquisitions occurring during the audit period. No adverse assessments or deficiencies were asserted with respect to any recurring operating transactions. The audit was extended to 2012, which is now part of the resolution. The company expects that the assessment will result in an approximately ($1.4) million impact on net income for the fourth quarter of 2014 after taking into account the company's previously established and disclosed provisions for uncertain tax positions. The audit has no effect on any positions that the Company has taken in any future years. This resolution includes all issues for the taxable years 2008 through 2012. Link to comment Share on other sites More sharing options...
Vish_ram Posted January 6, 2015 Share Posted January 6, 2015 Will the posters who viciously attacked EBIX without presenting a shred of evidence have the integrity to apologize? Link to comment Share on other sites More sharing options...
siddharth18 Posted January 6, 2015 Share Posted January 6, 2015 Let's read this again, shall we? To put things in perspective: Ebix owes at least $80 million to creditors, has a negative net cash position, and potentially owes over $100 million to U.S. taxpayers (in back-taxes, penalties, and interest). Looks like Gotham was wrong by just a magnitude of around 100x. Oops... It's unclear how Ebix's management can successfully navigate its declining operations even as Ebix faces the trifecta of the IRS, SEC, and DOJ. Well...with the benefit of hindsight, we can state that Robin Raina not only maintained his sanity (unlike the hysterical masses who sold out in a fire-sale), but in the interim, he acquired a few companies, obtained a line of credit and had two new board members join the company. True value investors will stay away from Ebix - There is no margin of safety against fraud, as famous value investors Benjamin Graham and Seth Klarman have taught. There was definitely fraud...the only question is whether the shorts were fraud (due to their illogical argument and short + distort campaign) or the company whose owner-operator had been at the helm for over a decade, had majority of his net-worth invested in it and was on the cusp of increasing his stake in the buyout? Be fearful of what the regulators know - We have provided regulators with additional information that has yet to be publicly disseminated, and we will likely continue to aid in their efforts. Gotham City Research has no obligation to share our additional findings with the public. You should assume that its materiality equals, if not exceeds, what we've published so far ....LOL...even the most gullible amongst us cannot POSSIBLY take that at face value. ---------------- Without gloating too much on the backs of underwater shorts, I gotta say - It's funny to look back at this thread and see how various posters on this board reacted to the same piece of news and information. I don't think there was an information advantage/edge here (i.e. - some having more info than others) - it was just that their bias (and the ability to be rational) was off. I believe that even if you have same information as everybody else, but have the emotional edge and the ability to be rational and focus on the right questions, you will come out ahead over time. Maybe it's due to our past experiences, or our defense mechanism...or due to simple risk-aversion. What I learned most from EBIX, OCN/ASPS, Buffett's AXP purchase and Dr. Mike Burry's Avant! purchase is that if there's a solid core business that's worth something, with real customers that generates real cash, then temporary short-term issues are easier to get over. Someone wrote in the OCN/ASPS thread that the regulator had a problem with the business model, not some ancillary issues like tax-rate or "intentional misconduct" and had "a gun pointed at the heart of the company." Compare that to EBIX/AXP, where the core business was very healthy and very much in demand. It was clear that EBIX's core business was never in trouble. If this business had no moat, how fast would've the clients fled? But not a single client left. EBIX even came out and said they hadn't lost a single client through all this. It would've been a nightmare for EBIX clients if EBIX were shut down...and there was no problem with EBIX's product to begin with, so they had no reason to leave. So I'm wondering...what happens to those ~15 million shares that are short? Link to comment Share on other sites More sharing options...
investor-man Posted January 6, 2015 Share Posted January 6, 2015 It's good to see a positive development for EBIX. I was tempted to buy it way back when all the negativity erupted, but ultimately decided to put it on the too hard pile. Link to comment Share on other sites More sharing options...
Phaceliacapital Posted January 7, 2015 Share Posted January 7, 2015 I'm out, I based my thesis around the offer from GS and had a sell order at 20. Rode it up from 13.5 so not that bad, I also had the USD currency effect. Link to comment Share on other sites More sharing options...
bookie71 Posted January 8, 2015 Share Posted January 8, 2015 I wonder if the short sellers got hammered or if they got out in time? I hope hammered. (jmho) Link to comment Share on other sites More sharing options...
HWWProject Posted January 8, 2015 Share Posted January 8, 2015 Look forward to diving into EBIX further to see how much value remains after this weeks big move up. Held this stock for a year (and a day) back in 2012-13 as a 'Magic Formula' pick. Made no money on it. Wished I'd held longer. Would love to know how big the 'market' is that EBIX is going after - because I think Raina will make sure they're the dominant player. Link to comment Share on other sites More sharing options...
Liberty Posted January 8, 2015 Author Share Posted January 8, 2015 EBIX now up over 100% since the Goldman deal fell through a year and a half ago. Congrats to those who bought then :) Link to comment Share on other sites More sharing options...
Vish_ram Posted January 8, 2015 Share Posted January 8, 2015 EBIX now up over 100% since the Goldman deal fell through a year and a half ago. Congrats to those who bought then :) What does it have to do with anything? Who cares about anyone who bought during the deal? They could be doing an arb play. The fact is that, like in fairfax, ebix and raina were slandered. The shorts were shouting fire in the crowded theater. The only sad part is the posters here joined the shorts chorus and yelled fire. I've been in this forum for last 10+ years and this was the first time I witnessed something unsavory. You make $, lose $. in the long run $ doesn't matter. Reputation and integrity matter. I don't even have a big ebix position, but have spoken to Raina. Link to comment Share on other sites More sharing options...
Liberty Posted January 8, 2015 Author Share Posted January 8, 2015 EBIX now up over 100% since the Goldman deal fell through a year and a half ago. Congrats to those who bought then :) What does it have to do with anything? Who cares about anyone who bought during the deal? They could be doing an arb play. The fact is that, like in fairfax, ebix and raina were slandered. The shorts were shouting fire in the crowded theater. The only sad part is the posters here joined the shorts chorus and yelled fire. I've been in this forum for last 10+ years and this was the first time I witnessed something unsavory. You make $, lose $. in the long run $ doesn't matter. Reputation and integrity matter. I don't even have a big ebix position, but have spoken to Raina. I can't congratulate people who had the guts to buy when everybody else was running the other way? Isn't that a lot of what value investing is about? Don't take your frustration out on me. I started this thread and defended EBIX for years. I haven't owned any for a long time, and I don't plan to, but I'm certainly not to blame for the business having been attacked. People can't even admit they were wrong about Apple in 2013, so I doubt you'll see people say they were wrong on Ebix any time soon. Link to comment Share on other sites More sharing options...
Phaceliacapital Posted January 8, 2015 Share Posted January 8, 2015 Reputation and integrity matter. Try buying a Ferrari with that :D (Just kidding, don't shoot me, I was long) Link to comment Share on other sites More sharing options...
Martian Posted January 8, 2015 Share Posted January 8, 2015 I wonder if the short sellers got hammered or if they got out in time? I hope hammered. (jmho) http://www.nasdaq.com/symbol/ebix/short-interest Most of the shorts are still intact. The volume of the past few days will barely make a dent on the overall short position. I think most of them shorted at $20, so they might not have lost much so far. Link to comment Share on other sites More sharing options...
Vish_ram Posted January 8, 2015 Share Posted January 8, 2015 Reputation and integrity matter. Try buying a Ferrari with that :D (Just kidding, don't shoot me, I was long) ha ha. Good one ---------------------------------------------------- Liberty: You were not one of the posters that I was referring to. I value your posts. ---------------------------------------------------- Let me forget about who wrote what and focus on the biz of making money. Haters gonna hate. Link to comment Share on other sites More sharing options...
siddharth18 Posted January 8, 2015 Share Posted January 8, 2015 I wonder if the short sellers got hammered or if they got out in time? I hope hammered. (jmho) http://www.nasdaq.com/symbol/ebix/short-interest Most of the shorts are still intact. The volume of the past few days will barely make a dent on the overall short position. I think most of them shorted at $20, so they might not have lost much so far. The only ones that got hammered were (i) the idiots who sheepishly took whatever the shorts said at face value and sold their long position at an absurdly low price or (ii) the imitators who piled onto the short at a lower (riskier) price than Gotham City. The worst outcome was for those who shorted right after the merger was terminated and there was mass panic. From an analytical perspective, we can get some insight into the price of the shorts by looking at this: http://chart.gurufocus.com/1420754361727.png. Looking at the magnitude of short interest increase in June and the prevailing price then. Which means that over 20 percentage point increase in the short interest occurred at prices between $10 and $12 per share! Looking forward a bit, you can see that the shorts started covering when the price went to $17.5/share but again the short interest increased at prices between $12.5 and $15/share. The conclusion I draw from it is that, on an absolute basis, from May end 2013 till this week, the price was always below $20 and we saw a substantial increase in short interest. Which can only mean 1 thing - huge losses (even if it's MTM) for the shorts. Let me forget about who wrote what and focus on the biz of making money. Haters gonna hate. Meh...I can blame the shorts too much...without them, how would I ever have bought EBIX at $10, or even took interest in EBIX in first place? I'm sure SOME shorts made good money here too, actually, as long as they exited around the peak of panic (right after acquisition was terminated)...and as long as they didn't short when the risk/reward of being long, far exceeded risk/reward of being short. Link to comment Share on other sites More sharing options...
innerscorecard Posted January 9, 2015 Share Posted January 9, 2015 I've held EBIX since August 2014 at a cost basis of 13.95 as part of my mechanical strictly rule-based Magic Formula strategy. I guess it shows that despite most heavily-shorted stocks under-performing the S&P 500, they sometimes really do work out, especially as part of a basket of stocks with similar attractive characteristics. I will sell it this August as I strictly obey the exact rules with my Magic Formula basket strategy. (Of course, I've also held CBI, HLF and WTW, among other stinkers.) Link to comment Share on other sites More sharing options...
siddharth18 Posted January 20, 2015 Share Posted January 20, 2015 Looks like a nice squeeze...the bad news (for shorts) is that such squeezes have a nasty way of reinforcing themselves. Truth doesn't matter in the short run (as they should very well know). Besides, the longs here seem vindictive and out for blood. Anyway I'm out of EBIX. It was quite a ride. Link to comment Share on other sites More sharing options...
mankap Posted January 20, 2015 Share Posted January 20, 2015 It is a nice feeling after a long wait. For me the biggest factor in the decision making process was Ebix's consistent cashflow and low valuation. Once two new directors joined the board, I had a feeling that they will settle soon. One of the new board members is Joseph R Wright. He is is currently member of Obama's defense board. He has a long history of serving under various presidents. If Ebix were fraud, why would such a person agree to be associated with such a company. I think having Barrington capital as shareholder and on board is a shareholder friendly move. They bring experience to the board and can guide Robin Raina on how to handle legal issues. Link to comment Share on other sites More sharing options...
mankap Posted February 17, 2015 Share Posted February 17, 2015 Ebix is moving to its all time high. I do not what triggered today's run. There was a news that Ebix won a contract for setting up a insurance exchange in London.I do not know how big the win is. Here is the news Ebix wins London market PPL tender Adam McNestrie16 February 2015 IT software firm Ebix has beaten competition from Xchanging in the tender for developing a IT platform that will allow electronic placement to be introduced to the London market, The Insurance Insider can reveal. The Placing Platform Limited (PPL) board, which was created by the London market insurers and brokers, made its decision earlier this month following a competitive tender run by management consultancy Accenture. PPL had originally planned to choose a service provider for electronic placement by the end... Link to comment Share on other sites More sharing options...
Liberty Posted March 13, 2015 Author Share Posted March 13, 2015 +16% http://www.ebix.com/PressRelease/PressReleasebyID/332 Link to comment Share on other sites More sharing options...
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