--- the subscriber area has no ads and those above are not selected or endorsed by this site ---


Ebix forbearance extension and more -3

08:12 16-Nov-23


Ebix has filed an extension to its original forbearance agreement, which gives it until December 17th.  My read on this is that we will see a transaction soon.  Ebix was obligated to come up with one, and the plan on the table was not at least viable, Ebix would have sought a longer extension.  The creditors would either grant that or they are forcing the company to proceed with the transaction.  The only things that have changed here are the stock price and the latest results.

EBIX shares more than doubled to a high of $7.21 yesterday, before quickly falling back to close at $5.66.  I'm inclined to disregard that movement.  In the not timely filing, I referenced the $3.50 price as evenly balancing risk and reward, and I think the operational results bore that out.  One might figure that the company getting to continue as a going concern could improve results, as customers need no longer fear bankruptcy.  However, if the CEO and current management remain at the helm I would regard that as an offsetting factor.  Thus, I'm guessing that prices between $3.50 and $5.00 will fairly price the imminent survival outcome.  Given that bankruptcy is still a possibility, though unlikely, I tend to shade a bit toward the bottom of that range.  We'll probably see soon enough.

Akoustis has also announced the DARPA Phase 2 award that was mentioned with recent earnings.  Consequently, I don't think this is material, and I attribute the recent rise in AKTS to that report indicating a financial situation that is not quite as bad as it might have been, and the positive inflation data.

However, I note that much of the latter positivity was due to falling fuel prices.  We shouldn't get too carried away about that.  I think the reaction is mostly played out, and note that stopgap funding and Biden's meeting with Xi solve nothing.  Data for the latest monthly charts should add color to that opinion soon.