IMF Bentham. When the Slater and Gordon fiasco started...

IMF Bentham.

When the Slater and Gordon fiasco started happening, the contagion was insane and these forums and the market went crazy, crushing the IMF price down to about a dollar, when all the metrics pointed toward it being quite stable and ok, with great cashflow but uncertain timing.

All the theories (and new forum posters) came out about accounting practises to hide this and paper over that.

I wanted to buy at $1 but felt it was too high risk and uncertain. Checked back and they are back around the $2.80-3.00 mark... haven't been this high for a long time. Business performance metrics prevailed over forum posts and media stories.

At the peak of the S&G fuss, IMF were relentlessly smashed from $2.50 down to $1, losing about 2/3 of their value, but as the numbers rolled in, the business continued and the media moved onto something else, they just quietly returned to fair value.

I think this will also happen with RFG. At the franchise level, they are extremely diversified against individual businesses failing. Yes, they face systemic headwinds in retail and their brands, and with this publicity they will struggle to maintain domestic ops, but i don't think the guy in Dubai or KL gives a rats, or is even aware of all this carnage, and will still buy their crappy food.

I think growth will be lower but they will just push on. 2500 stores are not going to the wall overnight. we have more than stripped out the future cashflows from this thing with the price at $1.64. at some point there's a value play here, but obviously management are low, low, dirty scum and cannot be trusted at all, so who knows what else is lurking out there.

and they will not be insolvent if the intangibles are written down. The cashflow test will see that the operating cashflow more than covers their interest. The interest cover is 13x

As i wondered with IMF back then: "should i pile in here, or is this dog going to zero?"