phil_Buffett Posted January 23, 2014 Share Posted January 23, 2014 Stock is off 9%-10% since Jan 9. one step foreward, two steps foreward. everytime the same :D. i dont like it but it is normal Link to comment Share on other sites More sharing options...
phil_Buffett Posted January 28, 2014 Share Posted January 28, 2014 stock down more and more. amazing. big undervalued. liberty global bought ziggo an dutch cable Company for over 11times ebitda. if gncma only get a multiple of 5times it is a steal. Link to comment Share on other sites More sharing options...
yadayada Posted January 28, 2014 Share Posted January 28, 2014 10 billion right? 2.7 in net debt. 0.95 bn in ebitda. That would imply roughly 7.7x ev ebitda? Which would imply 1.2 bn$ for GCI. But weren't there some strategic advantages of buying up ziggo with their other holdings? So GCI prob wont get a multiple that high right. allthough at roughly 6x ev ebitda it would still be a double. Link to comment Share on other sites More sharing options...
phil_Buffett Posted January 28, 2014 Share Posted January 28, 2014 10 billion right? 2.7 in net debt. 0.95 bn in ebitda. That would imply roughly 7.7x ev ebitda? Which would imply 1.2 bn$ for GCI. But weren't there some strategic advantages of buying up ziggo with their other holdings? So GCI prob wont get a multiple that high right. allthough at roughly 6x ev ebitda it would still be a double. if ziggo has more Advantages i dont know exactly. i only want to say there is a lot of interest in the cable Business and the companies pay high Prices. the lowest Point in the valuation for gncma is a double. iam looking more for a 2x or 3x. packer mentioned also before that we can normally value cable co´s around 6-7times ebitda. so gncma would be worth a lot more than today. the valuation Point is a Point of view. iam very positive about this Company, because i have a large margin of safety. if it doubles in two years it is great. if it goes up more, ok i take it and would be more happy. i can sleep well at night. Link to comment Share on other sites More sharing options...
jm25 Posted January 28, 2014 Share Posted January 28, 2014 I'm not sure what numbers you guys are using, but Capital IQ says: Market Cap - $407 Debt - $1,091 Cash & STI = $58 NCI = $306 EV of $1,746 2014E EBITDA of $285; therefore EV/14 EBITDA of 6.1x, leverage of 4.4x LTM Link to comment Share on other sites More sharing options...
phil_Buffett Posted January 28, 2014 Share Posted January 28, 2014 I'm not sure what numbers you guys are using, but Capital IQ says: Market Cap - $407 Debt - $1,091 Cash & STI = $58 NCI = $306 EV of $1,746 2014E EBITDA of $285; therefore EV/14 EBITDA of 6.1x, leverage of 4.4x LTM if you take the ebitda of $285 and multiple it with 6 you have a fair value around 1,7b$. market cap 400mio. so it is a multibagger even if you take a low multiple of 4 it is 1,1b$ Link to comment Share on other sites More sharing options...
jm25 Posted January 28, 2014 Share Posted January 28, 2014 I'm not sure what numbers you guys are using, but Capital IQ says: Market Cap - $407 Debt - $1,091 Cash & STI = $58 NCI = $306 EV of $1,746 2014E EBITDA of $285; therefore EV/14 EBITDA of 6.1x, leverage of 4.4x LTM if you take the ebitda of $285 and multiple it with 6 you have a fair value around 1,7b$. market cap 400mio. so it is a multibagger even if you take a low multiple of 4 it is 1,1b$ Are you ignoring all the debt? EV is currently $1.7 billion. When you apply a multiple to EBITDA you need to back out all debt to get to your market cap. Link to comment Share on other sites More sharing options...
racemize Posted January 28, 2014 Share Posted January 28, 2014 I'm not sure what numbers you guys are using, but Capital IQ says: Market Cap - $407 Debt - $1,091 Cash & STI = $58 NCI = $306 EV of $1,746 2014E EBITDA of $285; therefore EV/14 EBITDA of 6.1x, leverage of 4.4x LTM Well, Packer has some calculations earlier that the adjusted EBITDA should be ~296m outside of the NCI (presuming that is coming from AWN). EBITDA with the NCI should be well over 300, I would think. This requires some synergy adjustments, however. Perhaps this is why it is cheap--the data doesn't it show the multiples looking good, which should start showing up this year. There's also the uncertainty with Verizon... Link to comment Share on other sites More sharing options...
jm25 Posted January 28, 2014 Share Posted January 28, 2014 I'm not sure what numbers you guys are using, but Capital IQ says: Market Cap - $407 Debt - $1,091 Cash & STI = $58 NCI = $306 EV of $1,746 2014E EBITDA of $285; therefore EV/14 EBITDA of 6.1x, leverage of 4.4x LTM Well, Packer has some calculations earlier that the adjusted EBITDA should be ~296m outside of the NCI (presuming that is coming from AWN). EBITDA with the NCI should be well over 300, I would think. This requires some synergy adjustments, however. Perhaps this is why it is cheap--the data doesn't it show the multiples looking good, which should start showing up this year. There's also the uncertainty with Verizon... $300 million EBITDA at 6.0x doesn't leave for much upside, if any. Just trying to understand the story here. Maybe I should do more digging... Link to comment Share on other sites More sharing options...
phil_Buffett Posted January 28, 2014 Share Posted January 28, 2014 I'm not sure what numbers you guys are using, but Capital IQ says: Market Cap - $407 Debt - $1,091 Cash & STI = $58 NCI = $306 EV of $1,746 2014E EBITDA of $285; therefore EV/14 EBITDA of 6.1x, leverage of 4.4x LTM Well, Packer has some calculations earlier that the adjusted EBITDA should be ~296m outside of the NCI (presuming that is coming from AWN). EBITDA with the NCI should be well over 300, I would think. This requires some synergy adjustments, however. Perhaps this is why it is cheap--the data doesn't it show the multiples looking good, which should start showing up this year. There's also the uncertainty with Verizon... $300 million EBITDA at 6.0x doesn't leave for much upside, if any. Just trying to understand the story here. Maybe I should do more digging... if you take 6times ebitda with $300mio and also cut all the debt away from the valuation you have still almost 800mio$ so a double at least. this Company is undervalued and worth a lot more than a double. Link to comment Share on other sites More sharing options...
Packer16 Posted January 28, 2014 Author Share Posted January 28, 2014 Go back through the thread to understand the story. A few pages back there is an EBITDA and FCF calc taking into account GNCMA's ownership of AWN. Without these bottom's up adjustments looking from the top down can be misleading as the accounting does not fully reflect the economics. Packer Link to comment Share on other sites More sharing options...
phil_Buffett Posted January 28, 2014 Share Posted January 28, 2014 Go back through the thread to understand the story. A few pages back there is an EBITDA and FCF calc taking into account GNCMA's ownership of AWN. Without these bottom's up adjustments looking from the top down can be misleading as the accounting does not fully reflect the economics. Packer +1 Link to comment Share on other sites More sharing options...
xtreeq Posted January 28, 2014 Share Posted January 28, 2014 I'm not sure what numbers you guys are using, but Capital IQ says: Market Cap - $407 Debt - $1,091 Cash & STI = $58 NCI = $306 EV of $1,746 2014E EBITDA of $285; therefore EV/14 EBITDA of 6.1x, leverage of 4.4x LTM if you take the ebitda of $285 and multiple it with 6 you have a fair value around 1,7b$. market cap 400mio. so it is a multibagger even if you take a low multiple of 4 it is 1,1b$ Phil, The relevant multiple used here is EV/EBITDA, not Market-Cap/EBITDA. I believe there are some good threads on the subject of multiples in the General section, here's one I remember: http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/evebitda-vs-evebit-vs-pfcf/ Link to comment Share on other sites More sharing options...
racemize Posted January 28, 2014 Share Posted January 28, 2014 I'm not sure what numbers you guys are using, but Capital IQ says: Market Cap - $407 Debt - $1,091 Cash & STI = $58 NCI = $306 EV of $1,746 2014E EBITDA of $285; therefore EV/14 EBITDA of 6.1x, leverage of 4.4x LTM Well, Packer has some calculations earlier that the adjusted EBITDA should be ~296m outside of the NCI (presuming that is coming from AWN). EBITDA with the NCI should be well over 300, I would think. This requires some synergy adjustments, however. Perhaps this is why it is cheap--the data doesn't it show the multiples looking good, which should start showing up this year. There's also the uncertainty with Verizon... $300 million EBITDA at 6.0x doesn't leave for much upside, if any. Just trying to understand the story here. Maybe I should do more digging... Here's Packer's original calculation: I get EBITDA closer to $296 = $62.1*4 (total 2Q EBITDA) - $13.4*4 (2Q wireless EBITDA) + $150m*2/3 (AWN EBITDA (incl synergies of $30m); Note: 2 mo annualized EBITDA from ALSK disclosure closer to $200m) + $5m (AWN mgmt fee). I have net debt of $958 so EV of $1.343. Resulting in an EV/EBITDA of 4.5x. Adjusting for including the NCI gives ~350m and yields EV/EBITDA of 5.0x Link to comment Share on other sites More sharing options...
xtreeq Posted January 28, 2014 Share Posted January 28, 2014 Looked at my calculations, I'm getting net debt of $1,039. Packer, are you excluding the $76 capital lease obligations from the debt calculation? Link to comment Share on other sites More sharing options...
Packer16 Posted January 28, 2014 Author Share Posted January 28, 2014 I did not include cap leases but if I do the change is relatively small. Packer Link to comment Share on other sites More sharing options...
Yours Truly Posted February 4, 2014 Share Posted February 4, 2014 The stock has dropped 15% YTD and looks interesting if it falls further. Are there any catalyst in the future that some of you are expecting? or it simply just undervalued based on the ebitda/fcf adjustments? Link to comment Share on other sites More sharing options...
yadayada Posted February 4, 2014 Share Posted February 4, 2014 Won't they pretty much have a rock solid monopoly if they get the fiber installed tho? They are one of the first to do that. That should increase ebitda even more right? Since they dont really have meaningfull competition here. And everyone gets bundles these days. And how would verizon move in on their market if they dont own a cable running into alaska? I checked and if you want internet your pretty much forced to use GCI. So they should keep getting that roaming revenue stream since they own 2/3 of AWN? Unless Verizon buys ALSK. But even then they still get 2/3 of the assets right? And wouldn't that be a dumb move by Verizon. Since in most rural places in the US there usually exists some form of monopoly. So it makes the most sense to buy GCI if they want to really make a large move in Alaska. They do seem to care about customers tho that they install fibre. I looked at their internet plans, and those prices are criminal. Almost anywhere in Europe you would get their most expensive internet connection for like 1/4 or 1/5 of the price. Or they think that fibre will solidify their monopoly. Since then you wont have those ridicilous limits anymore. Using netflix alot on anything lower then their 80$ plan wouldnt make alot of sense. And then your safer with thier 110$ plan. What would prices look like on their fibre? I honestly cannot get why this is so cheap, there seems very little risk at this price. It looks really really cheap. I kind of want to make this a large position in my portfolio. Link to comment Share on other sites More sharing options...
jwfm1985 Posted February 4, 2014 Share Posted February 4, 2014 Added more today around 9.31. Not sure what has driven the decline, but tough to not buy more at these prices. Link to comment Share on other sites More sharing options...
Yours Truly Posted February 4, 2014 Share Posted February 4, 2014 Won't they pretty much have a rock solid monopoly if they get the fiber installed tho? They are one of the first to do that. That should increase ebitda even more right? Since they dont really have meaningfull competition here. And everyone gets bundles these days. And how would verizon move in on their market if they dont own a cable running into alaska? I checked and if you want internet your pretty much forced to use GCI. So they should keep getting that roaming revenue stream since they own 2/3 of AWN? Unless Verizon buys ALSK. But even then they still get 2/3 of the assets right? And wouldn't that be a dumb move by Verizon. Since in most rural places in the US there usually exists some form of monopoly. So it makes the most sense to buy GCI if they want to really make a large move in Alaska. They do seem to care about customers tho that they install fibre. I looked at their internet plans, and those prices are criminal. Almost anywhere in Europe you would get their most expensive internet connection for like 1/4 or 1/5 of the price. Or they think that fibre will solidify their monopoly. Since then you wont have those ridicilous limits anymore. Using netflix alot on anything lower then their 80$ plan wouldnt make alot of sense. And then your safer with thier 110$ plan. What would prices look like on their fibre? I honestly cannot get why this is so cheap, there seems very little risk at this price. It looks really really cheap. I kind of want to make this a large position in my portfolio. It's probably cheap because like Packer said in a previous post that at the surface level, it doesn't appear cheap at all and only appears so when adjustments are made. Looking at the last quarterly release, they bought a bunch back at an average cost of $8.26. Link to comment Share on other sites More sharing options...
Packer16 Posted February 6, 2014 Author Share Posted February 6, 2014 It looks like insider bought over $6.5 million in shares at the end of last month. http://finance.yahoo.com/q/it?s=GNCMA+Insider+Transactions Packer Link to comment Share on other sites More sharing options...
mbrock77 Posted February 6, 2014 Share Posted February 6, 2014 I think these were restricted stock awards, not purchases Link to comment Share on other sites More sharing options...
krazeenyc Posted February 6, 2014 Share Posted February 6, 2014 It looks like insider bought over $6.5 million in shares at the end of last month. http://finance.yahoo.com/q/it?s=GNCMA+Insider+Transactions Packer I think these were restricted stock awards, not purchases I think Packer might be talking about the Private Management Group Filing. Looks like Private Management group's buying was behind the December run up. Link to comment Share on other sites More sharing options...
Palantir Posted February 13, 2014 Share Posted February 13, 2014 Correct me if I'm wrong on this, but GCI's main expense as part of the AWN Transaction was buying assets from ACS for 100M? So basically they bought ACS assets, and then folded them into the AWN entity, and ACS also contributed some assets. End result being that GCI is getting a bump in EBITDA by about 24M this quarter, which amounts to nearly a 100M in EBITDA gain for the year. On top of that they are going to get escalating management fees.....am I wrong? Looks too good to be true. Link to comment Share on other sites More sharing options...
rayfinkle Posted February 14, 2014 Share Posted February 14, 2014 Packer-are you counting the preferred payments as debt? Link to comment Share on other sites More sharing options...
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