Albert Fried Defends SFX Entertainment (SFXE) on Seeking Alpha Short Seller 'Hit Job'

October 8, 2014 11:53 AM EDT
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Price: $0.01 --0%

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Albert Fried & Company analyst Rich Tullo came out in defense of SFX Entertainment (NASDAQ: SFXE) calling today's Seeking Alpha article a Short Seller “Hit Job.”

Tullo said, "We place little value on the Seeking Alpha article and its anonymous author. Our view is investors have to view such Media
“Intelligence” as potentially sponsored by a short seller or even fraudulent."

"The fact is SFXE expanded top line by 3 fold over the last 12 months ending in June to $82 million from $27.4 million which
makes SFXE the fastest growing Company in our coverage universe." He continued, "The fact that SFXE expanded revenue by about 300% and Adjusted Cash Out-Flow (AOCF or EBITDA) expanded at a slower rate to roughly $21 million in 2Q14E from roughly $15 million in 2Q13A suggests to us there is potentially significant operating leverage in the SFXE model."

He added, "We think a short seller has planted the seed that Robert Sillerman’s $5 million share repurchase is meaningful when the reality is sellers may have driven the share price down $300 million on the lack of purchase. We think buying or selling shares solely on the management’s failure to buy $5 million worth of stock is an extreme emotional reaction

The firm maintained an Overweight rating and price target of $11.00.

For an analyst ratings summary and ratings history on SFX Entertainment click here. For more ratings news on SFX Entertainment click here.

Shares of SFX Entertainment closed at $4.28 yesterday.

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