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EPD 54.5¢

Quiet Here

  1. Adequate

    861 Posts.
    Hi all (anyone?),

    I thought the impending results would warrant a little discussion here.

    I understand the acquisition of Intergen has gone rather smoothly. I can't help but think the market is seriously mispricing EPD.

    EPD purchased Intergen for $17.4 million, with staggered payments over a three year period. In it's acquisition announcement, EPD indicated the earnings multiple paid was consistent with other recent acquisitions. My estimate is that EPD paid about 4 times earnings. $1.8 million cash has been paid already and 4.3 million shares were issued on 2 December. The balance is to be paid over the next two years. So even aside from the earnings uplift or the variance in valuation multiples, EPD receives the full benefits from day dot. That's a clever deal.

    The imminent earnings report, update and guidance will prove me right or wrong one way or another.

    It's noteworthy the company is currently advertising some reasonably senior programming positions. Could be a sign of the growth currently being experienced.

    Cheers folks.

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