new stock flexigroup fxl

Well, I might as well be the first to post on FXL.

So, up 30%+ on the opening day. It was a ballsy move to go IPO rather than sell again to private equity. But considering the fact that the founders and some of the PE guys wanted to cash out now while the getting is good it should be no surprise.

So, long or short? Well, I think it is a nice semi-financial stock to have but there are some risks, that is for sure. First, it is way too leveraged to the Harvey Norman chain and thus to the discretionary spending of consumers. On the plus side, people now would rather spend the 5-10K on a new room sized flat tv than feed their kids or send to them to a good school, so I don't see this as exactly discretioanry anymore. Electronics is no longer discretionary it is a necessity of life (not my opinion personally FWIIW). But seriously, if Harvey Norman does well, they do well. If Harvey Norman gets a cold, FXL will get the bird flu.
On the down side, there are rumours of a pretty unhealthy internal IT situation in terms of their operations. Supposedly, some of the PE guys did not like what they found in the due diligence side of things.
Come to think of it, when every company and their dog is falling to PE firms, you have got to wonder why they PE firms didn't stump up the money. They obviously thought the priceof $2.00 was too high, the company will do a repco and tank (and then be open slather) and that the economic cycle is against them. Is the market actually the lastest sucker?
Considering a great Christmas period and the intro of Vista and Office 2007 in January it should be a great few quarters for FXL. Let's see. Anyone else have an opinion?