Xponential Inc (fka XPOI)

[Stock]

From Yahoo... I would guess this is someone that works for the company that posted this.

$7 a share valuation?? Common hasn't seen this price for years, but I'm sure they are watching the consolidation activity going on right now in the sector...

Pawn Mart Valuation
mrpanick
9-May-11 05:55 am

Pawn shops are a high margin business and are typically valued at a higher enterprise value / revenu multiple than most other retailers. You can check the enterrpise revenue multiples of XPOI competitors in yahoo finance key statistics for each company. EZPW is trading at 1.8X revenues. CSH is trading at 1.2X revenues. FCFS is probably the best match to XPOI in terms of business model and is trading at 2.4X revenues.

Pawn Mart should do at least 35 mil in revenues for 2011. If they sold the stores for 1.5X revenues that would value the company at close to 65 mil including 2 mil for the CPFH stake and almost 10 mil in pawn loans receivable, cash and notes receivable. The company has about 47 mil in total liabilities including paying off the pref A & pref B with back dividends, the notes and the bank credit line.

That leaves about 18 mil left for the 2.5 mil shares of common stock (about $7 / share) if they liquidated this with a decent sale of Pawn Mart.

Alternately management could use improving cash flow from Pawn Mart to pay off the pref A stock over time. What they really need to do is refinance Pawn Mart and pay off the 8% notes, bank credit line and Series A pref stock. Since they appear to be technically in default on the series A stock mandatory redemption, a refinancing is necessary to clean up their balance sheet and put the company back on a normal footing.