Synchronoss Technologies (SNCR) short, mcap=$114m, price $1.29 vs $1.53

Short pitch:
– On a verge of restructuring and shares are worthless.
– The recent $12.5m settlement with SEC compares with a $20m cash balance as of Q1’22.
– Topline is stagnant, the balance sheet is over-levered and the business burns cash at $5m per quarter.
– Reported EBITDA is accounting fiction and the company does not generate any FCF.
– Likely unable to raise fresh funds in the capital markets.

Valuation:
– Produced LTM FCF losses of $24m and has only $12m of cash after a recent SEC settlement.
– An over-levered balance sheet with expensive debt as well as preferred at 55% of the market cap, make common equity worthless.

Exp. gain: 100% to $0/share.

Full $SNCR write-up (free guest account required):
https://www.valueinvestorsclub.com/idea/SYNCHRONOSS_TECHNOLOGIES/5571991032

Published on: July 23, 2022  •  Published by:
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