ACF per Massimo

diverse cose nel report di brown le avevo già scritte io: Two Cheers for AmeriCredit -------------------------------------------------------------------------------- Article date: 09/24/02 Thomas Brown Director, bankstocks.com tbrown@secondcurve.com More by this Author... AmeriCredit management surprised investors (us included) last week when it announced a set of moves designed to ease the company’s near-term and long-term liquidity needs and make its earnings easier for investors to understand and evaluate. Overall, I believe management’s plan is a positive, although I disagree with one aspect of it: the amount of common equity intended to be raised. The announcement may not be great news for existing equity shareholders, considering the dilutive effects of the equity deal, but I’m surprised by the roughly 40% decline in AmeriCredit’s stock since the announcement. I doubt the selloff would have been nearly as dramatic in the absence of the financial panic that gripped the market overall last week, or in the absence of the controversy surrounding this particular company. For while the dilution is clearly a disappointment, it will be offset by some meaningful positives that will occur as a result of the company’s moves. In particular, AmeriCredit will have significantly reduced the near-term funding risk, and its earnings will be easier to understand and evaluate. My bottom line: AmeriCredit’s stock should be bought at current prices. Our Silence I’ve gotten literally hundreds of emails since AmeriCredit’s announcement, that either a) asked me for our opinion on the stock or b) informed me that I am an idiot. (I’m saving many of those latter messages, to reprint at higher prices.) We have not been able to comment until now because our compliance policy prohibits us from writing about a stock for one full trading day after we have either bought it or sold it. We have bought some AmeriCredit in each trading day since the announcement; it is our intention to purchase more in the secondary offering. Because of the interest, we have elected to not trade the stock so we can publish this piece. Management’s Plan First, some background. There are four aspects to the plan management announced last week: 1) An easing of short-term liquidity risk. Historically, AmeriCredit has chosen a to operate a business model that calls for rapid earnings growth and a high degree of financial leverage. Combine those two, and the company has had a steady appetite for cash to fund its growth. Until investor psychology turned from greed to despair, that seemed an appropriate model. Now, though, it’s not. One can debate whether management should have anticipated the level of collective panic that has lately overtaken investors, insurance companies, and rating agencies. Regardless, AmeriCredit’s business model has depended on ongoing access to outside financings--be they warehouse facilities, loan securitizations, overcollateralization agreements, and so on. That business plan is inappropriate in periods of extended financial panic, such as this one, because of the risk that investors, regulators, and insurers become so addled that they effectively shut down AmeriCredit’s ability to raise money. So AmeriCredit took two steps to ease its near-term liquidity concerns. First, the company reached an agreement with FSA, its securitization insurer, to relax the “delinquency triggers” in its securitizations for six months. In essence, the company has bought insurance to protect it from having its cash flow temporarily restricted by covenants in its loan securitization agreements. That’s good. Second, the company will boost its near-term liquidity by raising additional equity capital. This will likely prevent a debt ratings downgrade, as well as raise needed cash. The company’s plan was to raise close to $600 million in common equity, but in today’s market any amount north of $150 million would completely solve the company’s cash needs this fiscal year. The $600 million target amount would likely solve the company’s external equity needs forever, based on its new operating model. As noted, I applaud the company for raising cash, but as a soon-to-be-diluted shareholder, I don’t think the company ought to raise nearly as much as it’s planning to, especially considering the stock price. If AmeriCredit raises substantially less than $600 million, it’s fine by me. 2) Elimination of gain-on-sale accounting. Management has decided to stop accounting for its loan securitizations as asset sales. Those sales, recall, remove the loans from AmeriCredit’s balance sheet, and generate a series of one-time gains that have constituted the bulk of the company’s ongoing earnings. Going forward, AmeriCredit will continue to securitize its loans--but both the loans and the securitized debt will remain on its balance sheet. The company’s earnings will now essentially be the interest income it collects on those loans. This change by itself does not affect the cash flow of the business, but it does have a significant, temporary impact on GAAP earnings: the loan-sale gains suddenly stop, yet the interest income that will eventually replace them only build up slowly. It will take roughly two years for the GAAP net income of the new approach to equal the old. Again, the underlying business hasn’t changed, just the accounting. 3) Increase upfront cash in each securitization. This year, each time AmeriCredit has done a loan securitization, it has placed 2% of the principal balance upfront in cash, and borrowed 5% more from FSA, as security for bondholders. AmeriCredit does not receive any cash from the securitization trust until that initial cash, plus additional interest collections, reaches 12% of the principal balance. That process typically took 12-15 months. Such a highly leveraged structure places AmeriCredit at a high degree of risk to changing risk appetite at FSA. What’s more, it causes a mismatch between the time the cash flow from the trust is available to AmeriCredit and when it shows up in the company’s GAAP earnings. Too fix that, management has decided to put more cash up front in each securitization. Ideally, management would like to make that 12% initial cash deposit, so it could start receiving cash from the trusts immediately. Absent that, it would like to be able to post 7% up front, which is conservative enough that more insurers than FSA would bid on the business. I think this would be a great move which, in line with 15% loan growth, would enable the company to grow forecasts without seeking additional equity capital. 4) Three new independent board members will be added. AmeriCredit has eight board members today, including four insiders and four outsiders. The company has announced its intention to hire three new external Board members. This is clearly in sync with the corporate governance mood of the times, as is a good thing. Conclusion AmeriCredit has announced some meaningful changes in its business model: it has purchased near-term liquidity insurance; it will eliminate its use of gain-on-sale accounting; it will operate with less leverage overall and with less leverage in each securitization; and it will grow its loan originations at a slower pace in the future. All that is good for shareholders. But I disagree with the amount of equity the company announced it wants to raise. Raising some equity in this market makes sense. But investors are spooked as it is; the announcement that management wants to “raise it all needed” in this kind of market has spooked AmeriCredit investors even more. But, here we are, with the stock at $6 and change. The company will raise sufficient equity to solve its near term cash needs. It will not violate any FSA triggers. And, I believe, losses are easing and will eventually start to turn down. All of which would result in AmeriCredit’s stock being significantly higher over the next six to twelve months. What do you think? Let me know!

Queste sono le conclusioni dell'ultimo commento di Tom Brown sull'argomento: Conclusion AmeriCredit has announced some meaningful changes in its business model: it has purchased near-term liquidity insurance; it will eliminate its use of gain-on-sale accounting; it will operate with less leverage overall and with less leverage in each securitization; and it will grow its loan originations at a slower pace in the future. All that is good for shareholders. But I disagree with the amount of equity the company announced it wants to raise. Raising some equity in this market makes sense. But investors are spooked as it is; the announcement that management wants to “raise it all needed” in this kind of market has spooked AmeriCredit investors even more. But, here we are, with the stock at $6 and change. The company will raise sufficient equity to solve its near term cash needs. It will not violate any FSA triggers. And, I believe, losses are easing and will eventually start to turn down. All of which would result in AmeriCredit’s stock being significantly higher over the next six to twelve months.

Questa notizia è uscita ieri a mercati chiusi ed è positivissima per tutti i dubbi sollevati sul titolo, anzi, vista la fonte è il massimo della positività per acf: NEW YORK, Sep 18, 2002 (BUSINESS WIRE) -- Financial Security Assurance (FSA), the Triple-A rated bond insurer, said AmeriCredit's recently announced $500 million public offering to strengthen its capital structure should not raise questions about FSA's exposure to its guaranteed AmeriCredit securitizations. FSA has insured 31 AmeriCredit securitizations backed by auto loans over the past eight years, 14 of which have paid in full. The 17 transactions that remain outstanding are performing within expected parameters. These transactions benefit from strong legal and financial protections, and FSA is entirely comfortable with their current performance. A more detailed description of FSA's guaranteed AmeriCredit securitization program is available on the World Wide Web at www.fsa.com.

questo post è chiarificatore: " The insurer decided to cut the company some slack " . The "insurer" now has warrents on ACF stock; (i.e. they are in bed together). How do you see the relationship? The insurer now has alot to gain if ACF is profitable. I see a conflict of intrest.

ho tralasciato le modalità perchè non è rivolto ai possessori di azioni, quindi non ci riguarda

ma, avendo le azioni (200) come si fa ad essere informati sulle condizioni dell'aumento di capitale. Le ho su Intesatrade ma non è detto che mi arrivi l'informazione in tempo. saluti GCuneo

Il commento di Cramer che punta il dito sull'aumento di capitale mi ha fatto riflettere. In passato ci sono stati tanti auemnti di capitale fatti per dare vantaggi ai bene informati impaurendo la massa. Ad esempio nel 1997 (circa anno più anno meno) Unipol in estate raddoppio il numero di azioni in mano ai possessori, quindi dimezzò il prezzo e non capivo cosa ci fosse sotto, poi in autunno fecero un aumento di capitale con uno sconto ridicolo, quindi non conveniente, ma abbinarono un warrant per azione. Moltissimi diritti andarono inoptati e lì capii che il raddoppio di azioni in estate aveva come unicoscopo di poter prendere più azioni e più warrant nel seguente aumento di capitale, ma visto che le azioni erano poco convenienti conclusi che il vantaggio era il warrant e partecipai a tutti i cinque giorni di aste per i diritti prendendone un'enormità, poi vendetti le azioni e tenni tutti i warrant ad un costo di circa 350 lire: in seguito arrivarono oltre le 1500 lire ma io li avevo già venduti a 800 lire. Quest'estate abbiamo assisitito al crollo delle azioni finpart con denunce dell'amministratore delegato e oggi ci viene a dire che fa un aumento di capitale a prezzi superiori a quelli di mercato, altro esempio che non vogliono la massa, perchè hanno hgià stretto un accordo con due società per i diritti inoptati che saranno quasi la totalità, segno che lui acquista a prezzi stracciati e così le altre due società, perchè hanno prima fatto crollare kle azuioni ed ora pur pagandole di più le pagano molto meno che tre mesi fa. A me il caso ACF mi sembra simile, l'aumento di capitale viene fatto nella settimana di scadenza delle tre streghe e quindi i diritti sotto i 15 dollari che fino a ieri mattina valevano sono crollati e guarda caso a fine giornata hanno avuto altissimi volumi le opzioni a ottobre con strike 10 dollari, cioè quelle che hanno il minor tempo per andare in the money escludendo la scadenza di venerdì e con prezzo leggermente out of the money, segno che i tantissimi acquirenti credono che sotto i 10 dollari non possa rimanere olte il mese che manca alla scadenza e questi potrebbero essere i bene informati di questa vicenda. In fondo la società è la stessa di prima ed era già crollata da 60 a 13 dollari non per l'aumento di capitale, ma per i dubbi sull'insolvenza e sulla contabilizzazione degli utili, quindi ora con l'aumento di capitale abbiamo la diluizione che porta il prezzo di 60 dollari da cui siamo partiti a 40, ma non a 8 come ieri, però in cambio abbiamo avuto la trasparenza degli utili e tanta dui quella cassa da fronteggiare anche due recessioni di aumento di insolvenza quindi almeno a 40 il titolo dovrebbe andare, infatti gli utili preevisti col nuovo calcolo anche se sono la metà rappresentano pur sempre un p/e ridicolo. Da tener presente che tutto lo short è stato fatto con gli isitituzionali a comprare e prestare ai shortisti e questi a vendere dfino ad arrivare al 123% del flottante in mano ahgli sitituzionali e 47% di short, quindi mentre gli istituzionali guadagnavano dallo short che è poca cosa rispetto alle perdite nelle quotazione, vuol dire che non ne hanno tenuto conto essendo anche loro ben informati su quello che stava succedendo e che in seguito avrebbero anche loro guadagnato dai prezzi in ripresa. Tutto ciò quadra ora con il fatto che l'aumento di capitale ha un prezzo troppo alto rispetto alle quotazioni e quindi fa pensare che o la necessità di cassa non c'è perchè non verrebbe fatto e non ci credo, ma non alla necessità di cassa, ma non credo al fatto che non vogliano farlo effettuare perchè nessuno fa nulla per nulla e quindi non rimane che pensare che abbia il fine di far fare soldi a qualcuno che ha già fatto un patto coi dirigenti di acf come le due società che in Italia hanno garantito a finpart di esercitare i diritti inoptati, e con tutte queste situazioni il titolo rimane in prima linea per essere tenuto in portafoglio.

DJ. AmeriCredit -7: Credit Deterioration Drives Equity Demand Sep 17, 2002 (ODJ Select via COMTEX) -- Investors said AmeriCredit is turning to the equity market because of deteriorating credit market conditions. "We believe the current difficult corporate bond market, concerns over the weak economy, followed by the slowdown in cash flow due to gradually worsening credit trends have been material contributors to the need to raise substantial amounts of new equity capital," said analyst Robert Napoli of U.S. Bancorp Piper Jaffray in a research note earlier Tuesday. Whether or not equity investors are prepared to come up with the cash remains a question. But Standard & Poor's analyst Robert McMillan said he thought a successful offering was likely. "If the economy starts to improve, the business will start to improve and right now the stock is cheap," McMillan said. -By Christine Richard; Dow Jones Newswires; 201 938-2189; christine.richard@dowjones.com

Cramer dice che wall street la farà rimbalzare per piazzare l'aumento di capitale ----------------------------------------------------- AmeriCredit Bottom-Fishers Will Get Eaten By James J. Cramer 09/17/2002 03:01 PM EDT Click here for more stories by James J. Cramer Read More Click here for the latest from James J. Cramer Wall Street hates people who can't pay their debts, but loves companies that advance those same people credit. It's one of the most incredible paradoxes around. For years, for example, the stock market has worshipped at the altar of AmeriCredit (ACF:NYSE - news - commentary - research - analysis). When Peter Eavis pointed out in these pages a year ago, when the stock was double the current price, that AmeriCredit was an accident waiting to happen because of its lack of reserves, the catcalls were immediate. Wall Street analysts have always loved these companies because they believe that some companies really understand the risks of these bad debtors and can gauge them effectively. I saw this same misperception with Greentree and then again with Conseco (CNC:NYSE - news - commentary - research - analysis). I saw it with Providian (PVN:NYSE - news - commentary - research - analysis). I am seeing it with Capital One (COF:NYSE - news - commentary - research - analysis). These companies always get the benefit of the doubt in a huge way. The reasons they get it, though, are totally fatuous: We haven't had a prolonged setback to the economy in many years. It is natural, after years of peace, to fall behind on military spending. It is just as natural, after years of prosperity, to fall behind on reserves. I always think these companies are lousy investments. I figure that if people get smart, they will pay down all their debt. And if they don't get smart, they default. In between, maybe you can dance with those two tigers, but in the end you will slip and get eaten. That's why I think that anyone who is bottom-fishing with AmeriCredit is making a huge mistake. The company has to raise money by issuing equity. A smart company would have issued equity when the stock was high. Now it has to issue equity with the stock low. That's just plain stupid, but necessary. It is necessary for them, not for you. You don't have to participate. Don't worry, you will get your chance to get out at a higher level. Wall Street's not going to back away from AmeriCredit now. Now AmeriCredit needs Wall Street to do the issuance of stock. Wall Street needs the deal to help the quarter. Match made in heaven for everyone but the current and future shareholders of AmeriCredit!

State attenti che Eavis è molto preciso quando attacca un titolo, bisognerebbe segnarsi tutti i titoli di cui scrive. A sostenere ACF ci sono due come Tom Brown e Bill Miller di Legg Mason Opportunity Trust che hanno una grossa reputazione, ma sembra una storia complicata Wall Street Gapes at AmeriCredit Wreck By Peter Eavis Special to TheStreet.com 09/17/2002 11:52 AM EDT Click here for more stories by Peter Eavis Updated from Sept. 16 A 30% selloff Tuesday morning left investors standing agape over the wreckage of auto lender AmeriCredit (ACF:NYSE - news - commentary - research - analysis). The Fort Worth, Texas, lender to people with poor credit histories has been grappling with rising loan defaults over the past year. But credit problems appear to have gotten so bad that the once fast-growing company wants to take drastic measures to shore up its liquidity. The question now is whether investors will go along. After the close Monday, the company announced plans to issue as much as $575 million of stock. That slug of shares is equivalent to half of the company's market worth at Monday's closing price of $13.62. But with the stock plunging to $9 Tuesday morning, the market is signaling it isn't sure that the new cash will be enough to sustain what is clearly a flagging operation. "This looks like an admission that the company's business model wasn't able to sustain itself over a full business cycle," says Bill Ryan, consumer finance analyst at Portales Partners, a New York-based brokerage. Critics of the company had expected the liquidity issue to come to a head very soon; Detox first examined AmeriCredit's woes in a piece last year. And in its annual report, released Tuesday, AmeriCredit said it would need to raise at least $150 million and secure other financingsources if it were to "fund its liquidity needs in fiscal 2003." Mother of Invention? AmeriCredit took drastic action on numerous other fronts as well. In a bid to avoid making onerous cash deposits with the trusts it sells it loans to, AmeriCredit has agreed to issue warrants -- covering the purchase of 1.3 million shares -- to Financial Security Assurance, the insurance company that provides guarantees on its bonds. Related Stories Investors Sink Tight-Lipped AmeriCredit Nautilus Whispers Slowdown on Bowflex Underwriting Undercuts AmeriCredit Bulls Credit Quality Flags Fly at AmeriCredit Glossy Paint Job Can't Hide the Rust at AmeriCredit AmeriCredit also set plans to change the way it reports earnings from an aggressive method called "gain on sale" to a more conservative one, a move that will lead to much lower reported earnings and which, absent adequate disclosure, will make meaningful comparisons with past periods almost impossible. Earnings guidance for its fiscal first quarter ending Sept. 30, still expressed using the gain-on-sale format,show thatprofits will come in well below analysts' expectations. "I wouldn't characterize this as an emergency at all," says AmeriCredit spokesman John Hoffmann. "I'd characterize it as a new strategy." AmeriCredit said money raised from the planned equity offering may be used to bolster the cash cushion the company puts in the trusts that it sells it loans to. Previously, AmeriCredit borrowed the cash deposits, but lenders probably became increasinglyreluctant to extend credit. Bond investors buy notes issued by these trusts. The proceeds from those purchases flow back to AmeriCredit. The company makes money if interest paid on the trusts' notes is below the yield on the loans in the trust after expenses like credit losses. Trigger Man On a conference call Tuesday, AmeriCredit said the act of placing more cash in a trustwhen it is formedwill give the company the right to get cash out ofit more quickly. However, because the cash injection will initially be much larger than theoutflows,there wouldapparently still be a big cash drain for AmeriCredit. This, presumably, is why the company wants to raise as much as$575 million. The company is effectively asking investors for upfront funds tohelp it through a liquidity crunch. However,anyone buying the stock now would have to believe that $575 million is enough and that AmeriCredit's businessmodel and its managers aresound -- two increasingly hard-to-defend propositions. An added twist is that these trusts have triggers in them that require AmeriCredit to set aside large amounts of cash in restricted pools if past-due loans go above certain levels. Faced with that prospect, AmeriCredit has gotten FSA to agree to amend these triggers so that they are now set at a level in excess of the company's current forecast for delinquencies from September 2002 through February 2003, AmeriCredit said Monday. However, on a conference call Tuesday, Americredit executives said that the delinquency triggers would be raised only a percentage point. The executives said delinquencies are expected to rise in the fall and winter.AmeriCreditcandefer troubled loans andbook them as current. There are also triggers for these deferments, but one executive on the call said there is "plenty of room to execute our deferment strategy." AmeriCredit's critics argue that it increases deferments to keep delinquency numbers down artificially, a charge the company has denied in the past. FSA's motive appears to be to keep AmeriCredit alive. If the company collapsed, FSA could be on the hook for payments from AmeriCredit bonds. However, it is not clear at this point how much its warrants will be worth. FSA also gets a 0.25 of a percentage-point increase in insurance fees. FSA didn't return a call seeking comment Monday night. AmeriCredit said it expects to report net income of $55 million to $60 million in its fiscal first quarter. That compares with analyst expectations of around $90 million, implying a large credit charge will be levied. On the call Tuesday, AmeriCredit executive said the shortfall would be because the company will be making a provision to establish a loan loss reserve. Crunchy Crowd There is a big risk that, with its stock sliding,AmeriCredit won't be able to raise $575 million. If it fails to do that, company executives said Tuesday that there was a contingency strategy that involved slowing thegrowth of the company's loanportfolioconsiderably. Butif bad loans continue risingwhile growth slows,the cash crunch would be hard to survive. Improbably,AmeriCredit executives said Tuesday thatloan losses would stay within previous guidance even though delinquencies are expected tomove higher. AmeriCredit's actions also constitute a victory for investors and analysts who believed the company was heading off the road. Many fund managers had believed passionately in the auto lender. As of June 30, AmeriCredit was the largest holding of the Legg Mason Opportunity Trust, a mutual fund managed by the highly regarded Bill Miller. In addition, Tom Brown, who manages a hedge fund, has been an enthusiastic tout for AmeriCredit on his Web site bankstocks.com, where he wrote in August that "there is nothing materially wrong with AmeriCredit's fundamental outlook"and dismissed all liquidity concerns. AmeriCredit also announced that it's appointing three "independent" directors to its board. AmeriCredit's top executives have become very rich from selling stock in recent years. Job No. 1 for the three new guys: Don't let anyone reprice their options after this mess. They've just committed the stock market equivalent of driving at 120 mph while under the influence.

Tom Brown ha appena emesso questo comunicato, che ne pensate? Cosa può esserci sotto da non poter parlare? We have plenty to say about AmeriCredit, . . . Article date: 09/17/02 Thomas Brown Director, bankstocks.com tbrown@secondcurve.com More by this Author... We listened to the company’s conference call this morning, and will meet with management first thing tomorrow. Our comments about those conversations (and about the company’s announcements) should be posted on Thursday. Until then, we’re restricted by our compliance policy from commenting on AmeriCredit; our investment management firm was active in the stock today. Stay tuned! What do you think? Let me know! /TKB/

Questo tizio dice che ACF è la più grande occasione della sua vita al termine dell'articolo e sul sito c'è scritto: "Tom Brown is the best bank analyst in America, bar none." - James Cramer Qui trovate l'articolo di Tom Brown: http://www.bankstocks.com/article.php?id=603 Warren Buffett lo conoscete e pare questo articolo sia suo, dove menziona ACF: http://www.bankstocks.com/article.php?id=596

se questo sito funziona bene acf ha appena fatto un doppio minimo: http://iw.thomsonfn.com/iwatch/cgi-bin/iw_ticker?ticker=acf&symbol=acf

l'aumento di capitale è una causa, poi ce n'è un'altra che per me è positiva, tolgono la contabilità pro forma e gli utili previsti dimezzano, ma come vedi il p/e rimane ridicolo e alla fine l'aumento di capitale dovrebbe cacciare via dubbi sulla sua sovibilità a seguito dell'aumento dell'insolvenza.

Ho visto che ACF è sotto del 30% oggi ! Tutta colpa dell'aumento di capitale o c'è qualche altro motivo ? Tra l'altro ho visto che le proiezioni dell'utile per l'anno fiscale che finisce in giugno 2003 parla di 4,35 $ ad azione...vorrebbe dire un P/E di 2 !!! saluti GCuneo PS Si sanno le condizioni di questo aumento di capitale ?