What price to buy Lehman?

Discussion in 'Stocks' started by Cutten, Sep 10, 2008.

  1. What kind of price would be very cheap to purchase LEH - or is it going to $0?
     
  2. LEH or LEHQ?
     
  3. m22au

    m22au

    From memory, the book value of the company is about $27 (I think this is correct).

    NAB wrote down their CDOs to 10 cents on the dollar.

    MER wrote down their CDOs to 5 cents, providing non-recourse lending for another 17 cents.

    So if you apply 5% to 10% on book value, you have a range from $1.35 (5%) to $2.70 (10%).

    Using the 22% figure you have $5.94.


     
  4. That assumes all their assets are valued as those other written-down assets. Even at firesale prices they should be able to get >$3 per share for Neuberger-Berman. That means you'd get paid to own the rest of the firm (potentially not worth much, but definitely not worth less than $0 per share).
     
  5. I just hope some mother foker come and invest some money in LEH
    It has been taking my portfolio to the dogs :(
    So much viloatle a few days it was $18 today it is $ 7.0
    WTF
     
  6. Ive been watching LEH too. Chart looks like a good place for a squeeze but the news is horrible. Scary
     
  7. A 60 cent limit order will eventually get filled.
     
  8. So will an 8 buck short limit order. It's the unhedged drawdown on either of these that might do you in.
     
  9. Won't go to $0. Uncle Bens favourite nephews GS, JPM, and BAC all hold around $100m of the stock, with C holding $80m and MER $70m, so even though the Govt would like to allow an I-Bank to fail to dispel proleteriat murmurs of socilaism for the rich, it won't be this one, even though it has not written the credit derivatives that BSC had. As you can see a LEH failure would mean a systemic risk so the Govt will somehow prevent a failure in order to preserve the system, the Good Ole US of A, the right to extradite people from any country without consultation, Mom and Apple Pie.

    As for valuation......................maybe the value of cash + value of equity in building at 40% discount, plus asset manage,ment arm less Hedge Funds stakes, less debt + CDO's, leaving.........oh never mind.
     
  10. qLEH.PK

    or

    qLEH.BB
     
    #10     Sep 10, 2008