+ Watch EBIX
on My Watchlist
The Company is an international provider of software and Internet-based solutions for the insurance industry.
Turn key system for corporate and government healthcare exchanges. More corporations and governments will be moving to exchanges to drive increased competition making EBIX a winner for consumers and shareholders.
Shorts wrong. None of fraud allegations prove out.
Short Squeeze, Earning reports, change in Call's purchased, affordable medical care exchange activities, price is discounted well below true market value. EBIX has the lowest PE ratio's in comparison to its competitors as a result of shorting strategies and false misleading articles. 100 Million stock repurchase program. They are th e best value growth stock I can see at the moment.
Long. Software for insurance industry. Revs up consistently, 1 analyst. 6x ttm PE.
The shorts talk up an extremely emotional screen of smoke and lies. Ebix's accounting is faultless.
Ebix’s had a 11% earnings yield and 205.7% ROC a quarter ago with debt about the same as annual earnings. I like its growth model as it stands and support it wholeheartedly.
WOW is right
Stock oversold following initial announcement of investigation. If allegations end up being overstated, then company has quality portfolio of products needed for insurance industry to fall back on.
Investors should consider selling puts. You can achieve some very high annualized returns at strikes significantly below the current price. e.g.Sep 13 $9.00 strike at 65¢ has 28% discount and 39% annualized return.
Criminal probe needs time to settle
I don't think it can go much lower.
The Street overreacted to the failed GS purchase. 50%+ upside in this stock.
Great cash flow
Why EBIX Is A Double In The Next 3-6 MonthsEBIX has been getting lots of attention in recent months due to Gotham City's short posts and SEC investigation. However, I think during times like these it is important to take a step back and think about the possible outcomes. Fundamentally, EBIX is a high quality business with strong, recurring free cash flow and minimal capex needs. This favorable annuity-style free cash flow stream allows EBIX to return significant capital to shareholders. EBIX currently yields 3.2% and repurchased $118MM of stock since 2008 or 34% of current market cap. At today's price, EBIX trades at just 5x FCF or a 20% FCF yield. Now lets work through some math on the valuation.Bull case (25% probability): SEC investigation results in no issues, EBIX fixes corporate governance issues, and management and the board can refocus on organic growth and finding accretive acquisitions. In this case, I expect EBIX to trade back to its historical average P/E multiple of 15x. On 2013 EPS of $1.87, EBIX is a $28 stock.Base case (50% probability): SEC investigation finds some corporate governance issues, possibly even Raina departs or is removed from his CEO role. In this case, the strong free cash flow will not be adversely impacted. Corporate governance issues will be repaired over time but the company's reputation with investors will be damaged. In this case, I value EBIX at 10x P/E which results in a $20 stock price.Bear case (25% probability): SEC investigation results in material misstatements of financials and the company needs to restate historical financial information. In this case, EBIX will likely trade to 4x P/E while the company is in the restatement period which could take as long as 12-24 months. This values EBIX at $7.50. Even in this case, EBIX's software platform still generates substantial FCF and is a high quality business which could be sold to private equity so there is no chance that EBIX is worth 0.I estimate EBIX's fair value based on the above scenarios and probabilities at $19 (110% upside). The margin of safety lies in the strong underlying free cash flow that the business generates and the company's ability to repurchase stock and increase the dividend. Buying at just 5x FCF, over a 50% discount to fair value provides a significant margin of safety.EBIX's story is very similar to HLF over the last six months. A short seller created and presented a presentation on why HLF was a fraud, citing some valid issues, but over exaggerated his points. The stock fell 44% to $25. At the trough, HLF traded to 5x P/E, exactly where EBIX is now trading. The company used the opportunity to repurchase stock which was highly accretive. In the next month, HLF subsequently rebounded 80% back to its price prior the short seller's presentation. I expect similar price action from EBIX and recommend investors with a 3-6 month time horizon accumulate EBIX shares at these bargain prices.
Major drop today (6/20/2013). I will submit it here in caps.
Short term market noise creating a window of opportunity to own a great company. Market manipulators (the shorts) are not important when compared to management skill and proven SaaS (software as a service) model in the long run.Mr. Market will come to his senses soon enough.
there may be a bump in the offer price, there looks like a shareholder lawsuit that is asking for a higher price. I found this article on reuters:ATTENTION SHAREHOLDERS: The Sale of Ebix, Inc (EBIX) Under Investigation by The Young Law FirmPhoenixville PA — The Young Law Firm is investigating potential claims against the Board of Directors of Ebix, Inc (“Ebix” or the “Company”) (NasdaqGS : EBIX) concerning the proposed buyout of the Company by an affiliate of Goldman, Sachs & Co. The investigation concerns whether Ebix’s Board of Directors obtained fair value for the sale of the Company and whether the Board has fulfilled its fiduciary duties to Ebix’s shareholders in connection with the sale.Under the terms of the proposed transaction, shareholders will receive $20.00 per share in cash. The transaction has a total approximate value of $820 million.Shareholders have rights. If you own shares of Ebix and would like to learn more about these matters, please contact:Henry Young Esq.The Young Law FirmToll Free: (888) 452-7252Email: firstname.lastname@example.org visit: www.mergersbuyoutsandfraud.com/ebix-merger-buyout-shareholder-lawsuit/The Young Law Firm is a national shareholder litigation firm located outside of Philadelphia, Pa. We protect individual and institutional investors in state and federal courts nationwide. For more information about the firm and class action cases in general, please visit our website: www.theyounglf.com.
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