Author Topic: RCII - Rent-A-Center  (Read 16422 times)

given2invest

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Re: RCII - Rent-A-Center
« Reply #70 on: May 16, 2018, 02:09:48 PM »
I love when everyone references Volkswagen/Porsche in a crowded name.  There were very specific reasons for that squeeze and it was a pair trade - this has none of those qualities. 

I spent some time looking at Engaged portfolio and their investment success.  I was not impressed.  They have had some success in selling companies - and some failures.  But if you look at their core portfolio now, HAIN, RCII, TIVO - they have lost a lot of money on all of them despite market up huge.

Re turn-around strategy working - I have no view.  But I do know that consensus is if this ends w/o a sale - the stock will go down - A LOT.  So please keep that in mind as you invest for the coming weeks.

I am not short, not long obviously.


odin

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Re: RCII - Rent-A-Center
« Reply #71 on: May 17, 2018, 05:33:50 AM »
agreed given2...the business is poor and its a levered pig.  It's only generating cash bc inventory is being liquidated.

Note that Marcato bailed.  They were involved with Engaged initially.

No position.

LowIQinvestor

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Re: RCII - Rent-A-Center
« Reply #72 on: May 17, 2018, 08:07:02 AM »
I love when everyone references Volkswagen/Porsche in a crowded name.  There were very specific reasons for that squeeze and it was a pair trade - this has none of those qualities. 

I spent some time looking at Engaged portfolio and their investment success.  I was not impressed.  They have had some success in selling companies - and some failures.  But if you look at their core portfolio now, HAIN, RCII, TIVO - they have lost a lot of money on all of them despite market up huge.

Re turn-around strategy working - I have no view.  But I do know that consensus is if this ends w/o a sale - the stock will go down - A LOT.  So please keep that in mind as you invest for the coming weeks.

I am not short, not long obviously.

Puts seem to be very cheap if what you say is true.

LowIQinvestor

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Re: RCII - Rent-A-Center
« Reply #73 on: May 23, 2018, 07:30:36 AM »
For the record:

I think something material happens in the next 2 weeks  8)

given2invest

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Re: RCII - Rent-A-Center
« Reply #74 on: May 23, 2018, 09:27:46 AM »
I love when everyone references Volkswagen/Porsche in a crowded name.  There were very specific reasons for that squeeze and it was a pair trade - this has none of those qualities. 

I spent some time looking at Engaged portfolio and their investment success.  I was not impressed.  They have had some success in selling companies - and some failures.  But if you look at their core portfolio now, HAIN, RCII, TIVO - they have lost a lot of money on all of them despite market up huge.

Re turn-around strategy working - I have no view.  But I do know that consensus is if this ends w/o a sale - the stock will go down - A LOT.  So please keep that in mind as you invest for the coming weeks.

I am not short, not long obviously.

Puts seem to be very cheap if what you say is true.

You're right...option prices are odd - very low implied vol given the event is imminent.  Still have no interest but that's odd.  I think the likely outcome is a sale at/near current prices.

LowIQinvestor

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Re: RCII - Rent-A-Center
« Reply #75 on: May 23, 2018, 12:51:30 PM »
I love when everyone references Volkswagen/Porsche in a crowded name.  There were very specific reasons for that squeeze and it was a pair trade - this has none of those qualities. 

I spent some time looking at Engaged portfolio and their investment success.  I was not impressed.  They have had some success in selling companies - and some failures.  But if you look at their core portfolio now, HAIN, RCII, TIVO - they have lost a lot of money on all of them despite market up huge.

Re turn-around strategy working - I have no view.  But I do know that consensus is if this ends w/o a sale - the stock will go down - A LOT.  So please keep that in mind as you invest for the coming weeks.

I am not short, not long obviously.

Puts seem to be very cheap if what you say is true.

You're right...option prices are odd - very low implied vol given the event is imminent.  Still have no interest but that's odd.  I think the likely outcome is a sale at/near current prices.

Something must have leaked ahead of the annual meeting. :-X


MrB

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Re: RCII - Rent-A-Center
« Reply #76 on: June 11, 2018, 12:47:41 AM »
I love when everyone references Volkswagen/Porsche in a crowded name.  There were very specific reasons for that squeeze and it was a pair trade - this has none of those qualities. 

I spent some time looking at Engaged portfolio and their investment success.  I was not impressed.  They have had some success in selling companies - and some failures.  But if you look at their core portfolio now, HAIN, RCII, TIVO - they have lost a lot of money on all of them despite market up huge.

Re turn-around strategy working - I have no view.  But I do know that consensus is if this ends w/o a sale - the stock will go down - A LOT.  So please keep that in mind as you invest for the coming weeks.

I am not short, not long obviously.

Puts seem to be very cheap if what you say is true.

You're right...option prices are odd - very low implied vol given the event is imminent.  Still have no interest but that's odd.  I think the likely outcome is a sale at/near current prices.

Something must have leaked ahead of the annual meeting. :-X

Rent-A-Center Concludes Review of Strategic and Financial Alternatives, Announces New 2018 Guidance Based on Materially Improved Financial Performance and Provides Business Updates

...“Through the execution of our strategic plan, we continue to make significant progress to strengthen our financial profile and improve our results. Our cost reduction initiatives are significantly ahead of schedule and we expect to generate over $100 million in annual run-rate savings and realize approximately $70 million in savings in 2018. This compares to our previous expectations of $65 million to $85 million in annual savings and $43 million to $57 million realized in 2018 announced in February, and $75 million to $95 million in annual savings and $50 to $63 million realized in 2018 which was updated in April....

..2018 Guidance

Consolidated Revenues of $2.640 to $2.690 billion
Core U.S. Revenues of $1.835 to $1.865 billion
Acceptance NOW Revenues of $730 to $750 million
Adjusted EBITDA in the range of $160 to $180 million
Non-GAAP diluted earnings per share in the range of $0.65 to $0.90 cents
Free Cash Flow of $210 to $230 million (compared to at least $130 million announced in February and at least $170 million announced in April) [EDIT: Current MV = $540m)
Net Debt of $405 to $425 million at year end(1)
Consolidated leverage ratio of 2.3 to 2.7 at year end(2)..

http://investor.rentacenter.com/phoenix.zhtml?c=90764&p=irol-newsArticle&ID=2353933

LowIQinvestor

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Re: RCII - Rent-A-Center
« Reply #77 on: June 11, 2018, 07:11:41 AM »
Well this is pretty "material" !

Raised 2018 FCF guidance:

Free Cash Flow of $210 to $230 million (compared to at least $130 million announced in February and at least $170 million announced in April)

writser

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Re: RCII - Rent-A-Center
« Reply #78 on: June 12, 2018, 06:40:27 AM »
https://www.sec.gov/Archives/edgar/data/933036/000114420418033839/tv496322_ex99-3.htm

Quote
This letter confirms our best and final offer to acquire RCII for $14.00 per share in cash. At this time, RCII is in possession of all requested documentation concerning our proposal, including (1) a draft merger agreement that we are prepared to sign; and (2) an equity commitment letter and ample supporting documentation to evidence our ability to complete an acquisition of RCII. As previously communicated, we believe that our proposed merger agreement resolves all open points in a manner satisfactory to RCII.

As we have communicated on numerous occasions, we are committed to completing an acquisition of RCII as quickly as possible. We strongly believe that our proposal represents a value-maximizing outcome for RCII stockholders. It delivers immediate and certain value without any business execution risk. We are confident that RCII stockholders will agree that the right path for RCII at this time is for our offer to be accepted.

Our offer will remain open and capable of acceptance until 5:00 p.m., Eastern time, on Friday, June 15, 2018. If our offer is not accepted by that time, we will terminate our consideration of an acquisition of RCII.
When you are dead, you do not know you are dead. It's only painful and difficult for others. The same applies when you are stupid.

LowIQinvestor

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Re: RCII - Rent-A-Center
« Reply #79 on: June 12, 2018, 07:49:32 AM »
Stock is still cheap
Should be above $14 today