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StockCentral :: Community
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Join in on the discussion with other like-minded investors in our community forums. Learn about the fundamental investing methodology and participate in educational workshops in the Investing forums, stay up-to-date on StockCentral news and make suggestions to the StockCentral team in Central Square, and discuss your favorite stock or recent market news in our A-Z ticker-based forums.
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Gene Rooks
Gotha, FL (W. of Orlando)
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| 02/15/2008 12:49 PM |
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Our club owns XTO, which just announced the following: XTO Prices Sale of 20 Million Shares at $55 Apiece. That price is close to the current price.
To my still learning thought process, it would seem this will dilute the value of all shares after they are sold, thereby lowering both EPS and stock price. Is this how to view this announcement, or what am I overlooking? Gene. |
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Gene Rooks, Director
Space Coast Chapter
Accounting Instructor |
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Patrick Landers
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| 02/16/2008 2:29 PM |
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Gene,
I agree with ypur thoughts. I don't see how the Co. can release 20 million shares and not have it dilute the earnings. (That is an approximate 4.2% increase in shares outstanding) I looked at the company web site and found SEC filings on the sale. They want to pay off some old debt as well as fund some recent aquisitions with the $$. Hopefully, they will be able to increase earnings so the effects on the bottom line are minimal.
Pat Landers |
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Gene Rooks
Gotha, FL (W. of Orlando)
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| 02/16/2008 3:13 PM |
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Hi, Pat, thanks for the reply..I've about decided
the same thing myself, since our club already has a position in it, we will just
hold, not buy any more right now. I imagine there will be an
immediate reduction, but it probably won't last long.
Gene
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Gene Rooks, Director
Space Coast Chapter
Accounting Instructor |
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