A Titanic Verdict
A company called Premier Exhibitions (PRXI) has been on value investors' radars for quite a while now. I have never invested in the company because I find its body exhibit completely disgusting ;). I try to leave morality out of investing, as one can see by my investment in Philip Morris International (PM), but something about a company that makes money by exploiting the dead bodies of poor Chinese people and prisoners creeps me out.
I kid, somewhat, though that aspect of Premier completely turns me off I probably would be willing to invest in it if it was a screaming buy.
Not surprisingly, PRXI is up over ten percent today after the Titanic verdict, both literally and figuratively HAHAHAH (OK, I know that was bad).
Titanic salvage company wins award from Va. court
One doesn't realize just how big this is until they look at the numbers. If Premier really ends up getting $110 million for these artifacts, divided by 46.81 million shares outstanding that comes out to a whopping $2.35/share. That may not sound like a "whopping number" but it is when you consider that even after today's big gain PRXI's only trading at $1.76/share.
I wonder what's holding the stock back here? Yes, PRXI is earnings and cash flow negative, but it doesn't have much debt. If we add the $110 million to the $10.339 million "Cash And Cash Equivalents" and $3.308 million in "Short Term Investments" and subtract out the $5.518 in "Accounts Payable" and $6.585 in "other liabilities" we have a stock that should be worth a bare minimum of $2.38/share without even taking into account any of its hard assets that would be part of its book value.
I suppose that one major variable here is whether the Titanic assets are really worth $110 million. I wonder who's estimate that is?
Hmmm, the body exhibits still disgust me, but I'm going to take a flier on this one in CAPS.