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Lycos Internet

Discussion in 'Investment Analysis' started by nirajshah, Oct 4, 2016.

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  1. nirajshah

    nirajshah Champion

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    The stock is trading at 0.9 its EPS. Not book value but yearly earnings.

    Stock has a market cap of 380 crore and has annual profit of 405 crore.

    Does that not sound strange?

    Does it not mean the company has more cash than its market cap?

    If you have 400 crore, can you not buy this company and get back 2000 crores?? Trading under 0.2 book value

    Am I understanding anything wrong here ?

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    nirajshah, Oct 4, 2016
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  2. shabbir

    shabbir Administrator Staff Member

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    I am out of ideas but to keep things really simple if management is not willing to buy the company at that valuations, its better to be avoided.
     
    shabbir, Oct 4, 2016
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  3. sainath85

    sainath85 Member

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    Well in that case the only reason I could think of is that the market does not believe in the company's numbers.

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    sainath85, Oct 4, 2016
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  4. akuvijay

    akuvijay Active Member

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    First of all that management will not sell that company at 400 crores.. since it is making anual profit more than that.. if some one comes to buy that company then we can see the share price rally.. but considering current valuation market doesn't believe in the company

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    akuvijay, Oct 4, 2016
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  5. nirajshah

    nirajshah Champion

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    nirajshah, Oct 5, 2016
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  6. Suresh_Sinha

    Suresh_Sinha Active Member

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    These shares are best avoided.
     
    Suresh_Sinha, Oct 10, 2016
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  7. sethuramcbe

    sethuramcbe Responder

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    I do not believe in this company as of now
     
    sethuramcbe, Oct 13, 2016
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  8. shreeganeshchikhali

    shreeganeshchikhali Active Member

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    shreeganeshchikhali, Oct 13, 2016
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