National Holdings Corporation (NHLD)

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"Implications Of Unsolicited Offer To Acquire National Holdings"

"Implications Of Unsolicited Offer To Acquire National Holdings Corp." was posted on Seeking Alpha today by Transcend Event Driven Research.

It is blatantly obvious the author largely borrowed material from my NHLD posts to write the article. That was smart thinking; however, my only regret is the author did not bother to cite me as a source.

The author's projection of 2016 EBITDA at $3.2 million, however, is an extrapolation of this year's less than stellar numbers and clearly reflect the dangers of trending cash flow numbers that include a one time issue. This EBITDA projection is not only grossly less than the $10 million NHLD achieved in 2014, but also less than 2013's $4 million, and therefore, it does not pass the reasonableness test. This oversight produced a meager long-term stock fair value estimate of $3.90 to $4.50 per share, which is clearly too low.

I am forecasting NHLD's 2016 EBITDA to return closer to the $10 million it generated in 2014 before its alternative products issue.

With that in mind, recent Broker-Dealer transactions have occurred at a 14-plus multiple of EBITDA, which would put an acquisition price at $14 per share.

A "bargain" bid for National Holdings would be $8 based on comments from LPL Financial Holdings' (LPLA) Chairman & Chief Executive Officer, Mark Stephen Cassidy. He said LPLA is "a six times to eight times EBITDA buyer [because] to my mind, repurchase of our shares at an eight times EBITDA multiple is a bargain."

Finally, one "dark horse" bidder not mentioned in the article is Ladenburg Thalmann Financial Services Inc. (LTS). While there are potential issues, they are in need an acquisition in order to continue there top line growth.

You can see "Implications Of Unsolicited Offer To Acquire National Holdings Corp." here:

http://seekingalpha.com/article/3722586-implications-of-unsolicited-offer-to-acquire-national-holdings-corp