Diebold, Inc. (DBD)
The Company is engaged primarily in the sale, manufacture, installation and service of automated self-service transaction systems, electronic and physical security products, election systems and software.
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PEGDY screen 9_18_2009
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Reliable cash flow, solid management.
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This stock is very undervalued. It was undervalued at 29 when "Brand X" attempted a buyout and it is way undervalued now. I think it's ties to the banking industry are making people nervous but, what you have to remember, they are a service based organization. Even if banks are nationalized, they will still need service and product. Diebold has also diversified well.
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Sh*tty company under investigation for Enron-like shenanigans. Makes hackable voting machines and for all we know, writes code to randomly switch 2% of all votes to Republican from other parties. We don't really know, do we? But we can hope this corrupt old crapco goes down the tubes financially. Even if they maintain the div, it's hardly worth $20 on a value basis, and shouldn't be bought that high. In fact 20 is an appropriate sell point on fundamentals.
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cash cow, good earnings projection, new products, Global
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Short-term thinking (all banks will blow up) has clouded what should be the obvious. In the new, completely risk averse world of finance, what will banks choose?-- more ATMs or more subprime loans? hmm...
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I suspect that DBD rejected UTX bid because the executives were concern about passing the audit.
They can't clear their past report from October 07.
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DBD board has already rejected the takeover offer from UTX.
Saying it "drastically undervalues" the company. Hmmm, the offer was a 60% premium over the current stock price.
This won't end well for DBD.
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takeover
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China's buying.
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Financial Services industry is out of favor, helping to depress DBD. However, banks will continue to invest in new and upgraded ATMs around the globe. BAC alone has over 17,000 ATMS in their network....This looks like a value play with a decent margin of safety.
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Banks still have to keep updating security systems.
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atm's across the globe
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Real story is cost cutting. Restructuring of the manufacturing processes, order-to-cash cycle (increasing lead times), and supply chain . Significant upside.
75% of revenue derived from the Americas, International expansion should provide continued growth opp. Growth in the global ATM market will help drive future growth.
DBD will discontinue the use of bill and hold as a method of rev recognition in both its North America and international businesses. Change in accounting policy should help move SEC review forward
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Between now and the end of January is a good time to short this stock. Never buy this stock. Look to short now and whenever it gets between $ 47.00 and $ 50.00 for the next year or so.
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Diebold voting machines will get blame for some bugs etc. even though this only accounts for 6% of diebold's revenue.
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Company gets knocks for creating crappy voting machines and having a less than stellar management team. However the voting machine line of business is relatively minor and the management team has been virtually replaced since 2002.
Right now the company is a solid earnings machine printing cash with a dominant position in its primary market space.
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Its the election, man.
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This company has never delivered outsized return will continue to under deliver.

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