Kodak Stock Down to $5.45

Discussion in 'Industry News' started by mshchem, Oct 28, 2017.

  1. mshchem

    mshchem Member

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    I don't own any Kodak stock. I look at it from time to time. Last few months the market has been brutal to (KODK) In late December of 2016 Kodak was trading around $17 now it's less than 6 bucks. Insider trading (management) sold off in 1st qtr. The stock is being accumulated by hedge funds. It wouldn't surprise me if these guys would try to take Kodak private and break it up. Might be good, might be terrible.

    Market cap. is right around 250 million, Jeff Bezos could buy the company with his weekly earnings.

    In a word Vulnerable
    Mike
     
  2. wy2l

    wy2l Member

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    I'm surprised KODK is still listed on the NYSE.
     
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    mshchem

    mshchem Member

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    Kodak was a Dow 30 component from 1930 to 2004. I'm not sure what it takes to stay in the NYSE? Not very comforting for sure.
     
  4. RattyMouse

    RattyMouse Member

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    The NYSE has a minimum share price of $1. Once you drop below that then a stock gets delisted.

    Kodak stock has been hammered hard recently. What is more worrisome is that the overall market is doing exceptionally well (retail stocks aside).
     
  5. RattyMouse

    RattyMouse Member

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    What is there to break up with Kodak? They are a tiny, tiny business. I can't see anyone buying them at all.
     
  6. Sirius Glass

    Sirius Glass Subscriber

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    While I was a Kodak employee I had Kodak stock in my 401k. I held on to the stock for a few years as it slid down. When it dropped $3,000 in one quarter, I traded it all off for another stock.
     
  7. RattyMouse

    RattyMouse Member

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    Seeking Alpha has an article on Kodak that explains the reason behind the declining stock price. Basically the printing industry is in a steep decline and Kodak is seeing sharp drops in revenue and margins. Cash flow is negative and Kodak is burning over 60 million dollars of cash per year. Kodak is not a profitable company.

    Some quotes: "They [Kodak] won't be able to turn this around. They are operating in a commercial printing market that is in a long term decline due to the shift to digital content by publishers and advertisers. Continued decline in earnings and revenue will drive this stock below $4 over the next 12 months."

    I doubt very much we'll ever see the Ektachrome film we were led to believe is coming.
     
  8. RattyMouse

    RattyMouse Member

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    Looking further I found an interesting section on a report from 3 months ago (last quarter). This one mentions film and in a positive manner.

    Eastman Kodak CEO Jeff Clarke is not giving up on the consumer division. That segment also accounts for commercial film products, the celluloid some filmmakers still insist on using in this increasingly digital age:

    "Motion picture has a high profile, it's a product that's quite profitable for us, but it doesn't -- it's still only about 1/4 of the overall revenues in CFD. And so we're very pleased with the progress we're making, the pipeline of both motion picture film for a major motion picture, but also for television now," Clarke said in a conference call with analysts. "Last year, we really just had 2 television series, Westworld and The Walking Dead. Now we're up to 4 or 5. And so we're very pleased with some of the growth in that area."

    It's a relatively low-revenue business, dwarfed by approximately $200 million in annual sales of films for printed circuit board production. But filmmakers and TV content producers are giving Kodak a taste of growing sales while the industrial business is shrinking.

    Looking ahead
    Kodak is doing well in a handful of product lines, but the overall business is suffering. I think the company's management team is smart to slow down and eventually close underperforming operations, doubling down on the parts that actually work.

    That being said, Kodak's share prices have been cut in half since the start of 2017 and dropped 65% lower in three years. The company is barely profitable and the only clear path toward strong cash flows would involve shedding most of Kodak's remaining business operations.
     
  9. mgb74

    mgb74 Subscriber

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    The Kodak brand itself is probably worth a good portion of that market cap. Just like the Polaroid brand was a while ago.
     
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    mshchem

    mshchem Member

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    In the right hands there's a lot of money to be made. They still have a good graphics arts business. They make silver nitrate and fancy niche chemicals. I still think the real money is the trade names,

    For crying out loud how does Kodak sit and watch Instagram become a multi-billion dollar business based on sharing square photos. Kodak's marketing geniuses come out with a new cell phone and they call it Ektar.......... Why not come out with the Instamatic?

    Look at the ownership, right now it looks like private equity firms are the ones buying when everyone else is bailing. Not sure why?

    Mike
     
  11. DREW WILEY

    DREW WILEY Member

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    The future of film might be a lot more secure if that division was tightly or even privately held. They could finally be content with a simple net profit instead of stock market shenanigans. But it all depends on the long-term commitment of whoever.
     
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    mshchem

    mshchem Member

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    A benevolent billionaire that puts Alaris and EK back together, and puts some sort of product out there that the young folks go nuts for?
     
  13. RattyMouse

    RattyMouse Member

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    Only 22% of Kodak's revenue is growing. The rest are in declining parts of the company. And worse, the growth rate is nowhere near high enough to over come the declining rate. Kodak is burning cash at an unsustainable rate. The dwindling stock price reflects the fact that there are multiple problems within the company that must be overcome if it is too survive. I'm sure that Kodak is rising on the list of companies that people will short in order to make money. That will drive the share price down even further.
     
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  15. RattyMouse

    RattyMouse Member

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    Yeah, sort of like what Jeff Bezos did with the Washington Post. Newspapers all across the country are in serious financial trouble. Bezos put a floor under the Post and now they are doing OK. Some rich guy who loves film needs to buy *just* the film part of Kodak, let the rest die, and keep film going.
     
  16. RattyMouse

    RattyMouse Member

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    I'm sure that Kodak's shareholders would be very happy if they were turning a profit rather than bleeding 60 million dollars a year in cash. I dont see how turning Kodak private changes that at all.
     
  17. RattyMouse

    RattyMouse Member

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    Kodak shares continue to drop today, down -1.4%. Just a few more pennies in losses and Kodak will hit a 52 week low.

    What is almost just as shocking is the volume. Kodak averages just 140,000 shares traded daily. Apple trades 140,000 shares in less than 1 minute!! A true sign of how far Kodak has fallen.
     
  18. Wallendo

    Wallendo Subscriber

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    Private equity firms can take a company private and then divvy up the company, getting rid of the money losers and selling or spinning off the profitable segments, something that publicly traded companies often struggle with.
     
  19. DREW WILEY

    DREW WILEY Member

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    So what? A company doesn't have to be giant to be profitable. Those days are gone for Kodak. It's time for them to become a sustainable niche business that doesn't pretend to be something they're never going to be again. The stock value is going to collapse anyway.
     
  20. Richard Man

    Richard Man Member

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    Maybe Lomography has the cash....
     
  21. Prof_Pixel

    Prof_Pixel Member

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    Maybe Carestream Health would like to pick up the coating operations in Rochester to go along with their coating operation in Windsor, Co. This (I assume) could keep Kodak Alaris in film.
     
  22. RattyMouse

    RattyMouse Member

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    During Kodak's decline into liquidation they sold off almost all of the company. There was relentless divesting all the way down to the bankruptcy. It didnt help them. There is very very little of Kodak that is profitable. According to the article above, only 22% of Kodak's revenue is growing. That makes my tiny little company almost twice the size of Kodak!! Wow.
     
  23. RattyMouse

    RattyMouse Member

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    Share prices took another leg down yesterday for Kodak, falling an additional -3.6%. Today is the end of the month and so far Kodak has fallen an astonishing -28.08% in the past 30 days (the S & P 500 is up +2.1% in the same time period). A full 7.9% of Kodak's shares are now held short (owners expecting a further price decline).
     
  24. pentaxuser

    pentaxuser Subscriber

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    We see threads encouraging us to "bring back HIE; bring back Kodachrome etc. It might achieve more if somebody were to start a petition to be presented to D.T. He has a theme of Making America Great Again and in his early months of office didn't he help coal mines and miners in PA despite coal being largely "yesterday's fuel" Are there parallels here with film and unlike some coal mines isn't Kodak an American Icon?

    Just a thought

    pentaxuser
     
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    mshchem

    mshchem Member

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    It has amazed me that the wealthy patrons of art haven't made preserving analog photography a cause.
     
  26. btaylor

    btaylor Subscriber

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    Remember, photography isn't art. I wouldn't expect any help from wealthy art patrons.
     
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