Q: Would you consider the company a buy at today's close or simply a value trap?
5i Research Answer:
We are of course disappointed with the stock, and the recent financing is not helping at all. The company needs to address its debt issue, and we would prefer debt paydown over stock buybacks, which has been too much of a focus. Management made a soft proposal to take it private a while ago, and frankly recent moves almost make it look like they want a lower share price (and less shares outstanding from the buybacks). Going into year end, we can't give it a strong endorsement as a new buy considering risk and the overall market backdrop right now.