I am not a financial advisor, I do not have a crystal ball, I am a random ape who spent more time writing this up than researching the facts. There seems to be a lot of misinformation (likely for pump purposes) or lazy research out there.
**If you’re just riding the pump or are doing a covered call play, god speed. You may not care about this post.**
For anyone actually planning on holding through August 3, 2021, especially those trading on RH, please consider the following:
Shen sold their telecommunication business to T-Mobile (T) for $1.94 Billion (I’ll refer to this as TA)
$936.6 million to shareholders via special divided of $18.75
$684 is going to be used to pay down debt
The rest towards taxes I believe
After the sale of the telecommunication business, Shen will shift its focus to it’s broadband and tower business. I’ll refer to Shen post-sale of their telecom business as ShenP.
PE and Earnings Moving Forward
The EPS for **TA** for 2020 was $2.48 and $0.97 last quarter (this is very solid)
The EPS for **ShenP** was $0.05 in 2020 and a solid $0.06 last quarter, 2022 forecasted EPS of $0.29
The revenues for **ShenP** were $220.78M and are forecasted to grow 10.6% for 2021 ($244.2M) and 2022 ($270M)
Google and yahoo give you a PE of 18.59 (I’ve seen this same number in posts), but **ShenP’s** PE for last Q’s earning is closer to 254 and the forecast for 2022 is a PE of 210. These are based on $61 per share. Let’s say you’re still comfortable dealing with share price of $42.25 (61-18.75) because you get that juicy dividend, the PE is still very high at 176.
I’ve also seen a lot of information and spamming of don’t worry about your shares there will be a buyback after August 3, 2021. The buyback is about $20 million dollars. This is not worth talking about. Insignificant. Just being used as pump fodder. (Haven’t see anything else related to a buyback)
Insiders didn’t hold many shares but they have been dumping this thing and now hold less that 1% of shares, sales as recent as June 10, 2021 for $50.43.
To those of you without premarket capabilities, you are far more likely to get stuck hold bags during the eventual sell off. So what’s a company with $220.78M revenue and a forward guided EPS of $0.29 worth to you? If you buy it at $61 and are stuck holding the bag at $42.25, the special dividend premium was eaten up by your loss, you’re saying that company is worth $2.1 Billion dollars. **You’re paying $160M more than T-Mobile paid it’s acquisition but the company you own has 16x less earnings.**
For transparency, I hold puts, many many puts. I am not trying to create FUD or telling you to sell, I just want people to know what they are buying, I decided to use forward guidance and last Q which was solid for **ShenP** instead of 2020 numbers to try to be as fair as possible. If any of this looks inaccurate, please let me know.