Guys for those struggling on why this is down see below my view.
Some Short Hedge Fund "Aurelius Value" shorted massive amounts of shares awhile back and wrote up a piece on PAYS essentially stretching old facts and spinning it to try to make his point of view.
For those wanting my point of view and debunking his article see my commentary:
I know the company very well and have met the execs numerous times. This short story pulled up old news on the company which is over and dealt with/purposely stretched to make it seem as though his story is true - he is completely spinning facts.
1)I remain bullish especially at this price they have a great team put together filled with high profile execs that have "done this before" ie. see Dan Henry (he would not get involved with a fraud). The thing about the employee and his accounting firm was put to bed many years ago and the company has been gradually "upgrading" its accounting firms to make sure its adequate for the business. I have no concern about the accounting - them saying the firm they are using has had another company that mislead investors does not mean anything, everyone can have one bad client - correlation does not imply causation.
2)His thing about breakage fees making up most of their revenue is COMPLETELY false (the incident he was referring to was an anomaly 5 years ago that had an artificially high quarter due to the end of a card program and skewed earnings (this was not misleading just the way accounting was back then). Also by way of background there won't be anymore of those incidents a) because they now apply the new IFRS rules (came in play over the last year) that you report earnings of the program over time and not at the end and b) because they are consistently growing their plasma share (now with 35%+ market share) and growing their pharma business with REAL earnings - transaction fees, interchange fees, set up fees, admin fees etc... (just refer to their fillings or their recent investor deck to see where revenue comes from). This guy tried really hard to stretch his facts to play to his advantage. Strong margin growth and revenue growth, solid balance sheet,massive upside with re-loadable card, load up and be thankful for this gift.
3) His thing about management selling shares a) is mostly them selling their stock grants (ie. acting as a bonus) b) the management team owns nearly 50% of the company - do I blame them for taking a bit of money? No. (they have not sold shares in 10 years and its not like they are dumping hand over fist - a big portion of it is exercising options/grants, or selling shares to cover taxes relating to that (read fine print of many of those fillings) etc.
Lastly go back and have a look at the past quarterly results. 1) This re-loadable card will be a significant multiplier of earnings with hardly any customer acquisition costs. 2) They just onboarded a massive amount of plasma centers last month - these will only scale in volume. 3) large growth potential on the pharma side (just getting started) 4) Immense operating leverage as revenues scale operating costs are not expected to increase as much and much more will flow down to increase EBITDA margins. The value down here is getting quite attractive for such a high growth stock with a solid balance sheet and strong margins.
Hope this helps clear some of the facts.
