PRSC

opportunity of a lifetime?

"Analysts and others speculating that we'll violate our covenants"

"Most of this is the result of incorrect calculations"

"Historically speaking, recessions are favorable for us"

Looking at this, the earnings grow at about 12% and earnings have been growing at 40% year over year. It's priced to shrink. This Last quarter BLEW! will the company go bankrupt? Let's see.

This last quarter they had to write off a lot of their goodwill and this came directly out of their retained earnings taking them negative.

Now I'll be honest --- pricing this company with the dividend discount model = $0 since the retained earnings are -$101M and the company makes an average quarterly profit of $3M and all that unburying it has to do.

Whatever, logisticare should benefit from cheaper gas prices. http://www.randomuseless.info/gasprice/gasprice.html = REVERSAL of :::: As a result, the Company expects to report a substantial loss when it reports results for its third quarter of 2008. Due to the utilization trends and payer rate negotiation uncertainties in the transportation segment, mediation in Canada related to previously announced revenue cap enforcement, interest rate uncertainties, remaining procurement activity and the uncertain start date for the new South Carolina transportation contract, end reversal

I think that medicare or medicaid or something will be around paying for this. Besides, police were cutting down on routes since gas prices were so high. This all turned around since the barrel of oil dive bombed out of speculation back into reality.

http://www.nytimes.com/2008/11/08/washington/08regs.html?_r=2&hp&oref=slogin&oref=slogin

“More and more people are coming onto Medicaid,” she said. “People are losing their jobs and running out of unemployment benefits. Some employers can no longer afford to provide health insurance to their workers.”

Details:

Effective December 7, 2007, we acquired all of the outstanding equity of Charter LCI Corporation, or Charter LCI, the parent company of LogistiCare, Inc., or LogistiCare. LogistiCare, based in College Park, Georgia, is the nation’s largest case management provider coordinating non-emergency transportation services primarily to Medicaid recipients. The purchase price in the amount of $220 million consisted primarily of cash and 418,952 shares of our common stock valued at approximately $13.2 million in accordance with the provisions of the purchase agreement ($12.3 million for accounting purposes). These shares were issued in exchange for the cancellation of LogistiCare employee stock options. In addition, we may be obligated to pay additional amounts up to $40 million under an earnout provision contained in the merger agreement. The purchase price was paid with funds drawn down on a new credit facility and proceeds received from a private placement of our 6.5% Convertible Senior Subordinated Notes due 2014, or the Notes. The Notes will be convertible into shares of our common stock at an initial conversion rate of 23.982 shares of common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion rate of $41.698 per share of common stock. The initial conversion rate is subject to adjustment in certain events. The new credit agreement with CIT Capital Securities LLC provides us with a senior secured first lien credit facility in aggregate principal amount of $213.0 million comprised of a $173.0 million, six year term loan and a $40.0 million, five year revolving credit facility. We borrowed the entire amount available under the term loan facility and used the proceeds of the term loan to (i) fund a portion of the purchase price of this acquisition; (ii) refinance certain existing indebtedness; and (iii) pay fees and expenses related to this acquisition and the financing thereof. By adding non-emergency transportation services to our service offering, we are able to focus on better managing the front end of the Medicaid service delivery system ultimately saving government payers money through combined transportation case management services and home based social services.