Feb. 24 at 4:45 PM
$HRMY I suggest that the following is a key point to understanding when thinking about this earnings report of today and valuation. The reason that G&A expense was so very high in Q4 was that the company recognized
$30 million of litigation expense. This was a one time expense, and therefore must be backed out when attempting to establish the ongoing annuity level of the earnings stream. That accrual appears in current liabilities, of course. Having made this adjustment, one finds that the real, ongoing earnings was
$0.94 cents per share in Q4, and the real, ongoing EBITDA was
$304 million at the annual rate. The company did a poor job of communicating this point. It will take the analysts some time to understand this. IMO the stock is worth
$55.
