MYX - Mayne Pharma Group
- Thread starter Kuri
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Hmmm... not that the Market is always right or anything... but for a company where shareholders see their share price halved in a year, yet the company's market cap is still the same size. i.e. at $2 cap was $1.5m, at $1 a share, still $1.5. It's a pretty crappy business for shareholders.
When I raised the issue and say it's a crappy business - at $1 a share - Most people think it's a real bargain and reckon it'll go to $1.60s once the Teva acquisition put a fire under the FY17 results.
Didn't impress the market too much, price crashed to $0.70s... don't know man, maybe I'm not completely clueless I can't figure out the numbers.
Here's another prediction... MYX will raise more cash in FY18. Not because it needs to, of course. But because of "new opportunities".
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I found the ignore button protected my sanity.
Good on you mate. Awesome. We all know that the best way to see every side of the issue is to ignore those who raises too many issue it makes your head hurt. Always best to have "yes man" around.
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If I am going to buy that Teva portfolio and the net earnings would take some 16 years to break even the price tag... maybe I'd give some shiet about it.
Anyway, take a look at MYX cash flows since eternity. They've never managed to return enough cash from those investing and financing activities. i.e. they've financed [borrowed and raise equity] year on year, make loads of "investing" year on year... and not exactly raking in the cash from operation has it?
skc
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On one hand you are saying the market was wrong @ $2 a share, on the other you are using the market pricing it at ~$0.80 a share now to validate that you are right.
Most people? A few posters thought it's a bargain. 2 weeks on they are neither right or wrong.
You made a mistake in your calculation (applying a NPAT-to-gross profit ratio to the EBITDA) and you used the wrong methodology (using NPAT as payback calculations) in your assessment. Sometimes the correct answer (in this case it was just 50:50) can be reached using the wrong methodology and/or despite calculation errors. But the fact remains that the mistakes were still there and the methodology was still wrong. This is why any discussion with you lasting more than 2 posts drive people insane. Because you never address the arguments and simply move from one issue to the next.
I will continue to post here on MYX depending on where the discussions go, but you will understand when I don't reply to your posts in order to keep my sanity.
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Where did I say the market was wrong at $2 but right at ~$0.80? I even said that "not the the market is always right" etc.... So yes, those who think it's a bargain at a buck would be more right that it's even a better lately. So if they believe in their analysis and management's enthusiasms, load up... I recently did load up on Hikma when I bought in at 20 pound just to see it drop to ~14, and it's now in the high 12s.
The point I raised about the price crash was those who believe that MYX's history hasn't been that bright, but the Teva portfolio will be a game changer (of a good kind). Maybe it will be, one day... so far, the market hasn't been impressed. i.e. maybe I'm not always completely clueless.
As to EBITDA and NPAT... I've answered it above.
I remember reading some old Buffett's newsletter about EBITDA... it's management's way of telling shareholders how great the company's performance has been (if you ignore all the real life, bad stuff). You know, in real life taxes have to be paid, interests better be paid, depreciation and amortisation does actually costs the company money (eventually). But maybe that's just Buffett and what does he know.
As to using either Gross Profit or EBITDA to NPAT to gauge the recent market update that report the Teva's EBITDA's... as I said above, Interest will be higher FY17 (and coming years) as $145m was also raised for the Teva acquisition... add to the $888 raised, that's $1.033B.
Interest will also be higher now that MYX has $A355m "undrawn" debt facilities it just open up. Why open it when you're not going to use it soon, right?
Then there's the A or the D on that $1.033B (or $881m, depends on how you want to look at the actual costs of Teva's)... that's going to be written down to zero over 15 years. Do the maths and see how these alone will affect the "50%" EBITDA to NPAT this and in coming years.
I know, it's the cash flow, stupid.
Look through MYX historical cash flows. Those has never really been big enough to cover its dreams and ambitions. So that will leave either the shareholders or the lenders to fork out the cash.
So far in its corporate history, MYX shareholders has given some $1.2b (from memory)... If they still have faith in that brighter future, then sure.
As to the bankers... they kinda told MYX to better go raise more equity before they would think about lending more cash. Now that that's done and more debt has been raised... wanna bet how keen the bankers would want to lend given that most of MYX's assets are "intangibles"... you know, filing cabinets and office stationaries they can flog off at 10cents on a dollar. "Intangibles"... who knows.
Anywho... MYX is one of those companies that if you own it, best to take a really, really close look. Get a PhD in medicine if you need to. I mean, unless those new Teva R&D pipelines, or those R&Ds MYX has a definite chance of curing cancer or something, it's not going to be easy holding on.
If you study the likes of WalMart, or even BNSF... and study the failures like ABC Learning Centre and One.Tel.... MYX is more the One.Tels than the WalMart.
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The cynic in me thinks Brucie will offload his previous purchase within this financial year to please his accountant. But I guess it is a positive that a director have faith in the business's future.
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Mayne announced two new products today. (Which could explain the recent rise from 64.5 to 74?).
Both products in regards to dealing with UTI's.
Announcement mentioned:
"Mayne Pharma received a 5-year period of protection for the information it provided in its application to the TGA for approval for the products. Data exclusivity commences from the date on which the new product is registered and the effect is that generic competitors are not permitted for the period of exclusivity from using an innovator company’s data in support of their own application for approval of a generic product."
How significant is this? Wouldn't this largely be standard in the generic market?
Both products in regards to dealing with UTI's.
Announcement mentioned:
"Mayne Pharma received a 5-year period of protection for the information it provided in its application to the TGA for approval for the products. Data exclusivity commences from the date on which the new product is registered and the effect is that generic competitors are not permitted for the period of exclusivity from using an innovator company’s data in support of their own application for approval of a generic product."
How significant is this? Wouldn't this largely be standard in the generic market?
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Scanned through the CEO's speech today....
So it's been a bad year with sales down, earnings down. But, he says, if we ignore that and assume a more "normalised" future where the times are good again, it's going to be good.
How come people laugh at only me when I say stuff like that
And oh yea, they're cancelling/taking a lost on the share incentives. Rationale being that (with the share price being so freaking low) giving shares away is not going to incentivise the "employees" (aka, executives).
As Han Solo says to Chewy, that's not how incentives work!
You don't hand out cheap/free shares to "employees" to encourage them to create value for shareholders just to then take a lost on it and give them other more beneficial "incentives" when they failed to deliver the value to shareholders.
That's lowering the bar, widening the goal posts, heads I give you shareholders' money tails I give you more shareholders money.
I mean there are good and bad years in any business, even those managed by the best of them. But to have a board that does this kind of rubbish just isn't cutting it.
So it's been a bad year with sales down, earnings down. But, he says, if we ignore that and assume a more "normalised" future where the times are good again, it's going to be good.
How come people laugh at only me when I say stuff like that
And oh yea, they're cancelling/taking a lost on the share incentives. Rationale being that (with the share price being so freaking low) giving shares away is not going to incentivise the "employees" (aka, executives).
As Han Solo says to Chewy, that's not how incentives work!
You don't hand out cheap/free shares to "employees" to encourage them to create value for shareholders just to then take a lost on it and give them other more beneficial "incentives" when they failed to deliver the value to shareholders.
That's lowering the bar, widening the goal posts, heads I give you shareholders' money tails I give you more shareholders money.
I mean there are good and bad years in any business, even those managed by the best of them. But to have a board that does this kind of rubbish just isn't cutting it.
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TEVA has been going up in the USA.
Cutting back their workforce might mean less competition for MYX.
pixel
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MYX chart looks good. C&H breakout should trigger lots of buying interest.
I'm not on yet, but put it on buy alert. Waiting for volume supporting price.
I'm not on yet, but put it on buy alert. Waiting for volume supporting price.
Is this the price and volume action Pixel was waiting for?
I'm in for a small punt to find out
Knobby22
Mmmmmm 2nd breakfast
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I have noticed that there has been lots of interested buyers over the last month. Sellers are drying up when once there were plenty.
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So often in my endeavors I find myself:
- gun shy on a stock I've taken a loss on
- questioning whether I should be buying a stock breaking from a basing pattern over a stock that is clearly in an uptrend.
The dilemmas remain in this example however the patterns look promising.
Shout out to Pixel!
So_Cynical
The Contrarian Averager
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I have a parcel @ 63 from around Nov 2017, just a small punt with the IB account.
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Came up in my weekly system
Country Lad
Off into the sunset
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Kid, in my early trading days, I had a similar reluctance to buy back into ones that had not gone according to plan even though I was comfortable with the company, only to see them rise again. Then I had the logical light bulb moment realising that I had selected the right company, just at the wrong time. No hesitation now as long as I am still happy with the fundamentals or potential.
Breaking or one in uptrend? Both, I love breakouts and also often go for ones when they achieve 12 month highs.
