# DirectCash Payments Inc. (DCI.TO)



## Canuck (Mar 13, 2012)

Can anyone see any news that's making this stock tank today?


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## Canuck (Mar 13, 2012)

what the hell, down 22% on no news, and now they halt it


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## PatInTheHat (May 7, 2012)

also looking for info on this..


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## PatInTheHat (May 7, 2012)

Never witnessed something like this before. Pretty crazy. Must be mass insider selling before they break some awful news? Halted again


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## Canuck (Mar 13, 2012)

PatInTheHat said:


> Never witnessed something like this before. Pretty crazy. Must be mass insider selling before they break some awful news? Halted again


ya, gotta love this 
"Trading halts are issued based on the principle that all investors should have the same timely access to important company information"

so, many got out before the news was released, then they halt the stock.


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## lakota (Apr 3, 2009)

why does the Ask/Bid price keep changing while it is on halt? 12.5 then to 14.05 and finally 14.10 !! 14.15....can I buy while is is on halt!!1


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## Canuck (Mar 13, 2012)

lakota said:


> "Accounting Irregularities"


? where are you seeing this?


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## lakota (Apr 3, 2009)

Canuck said:


> ? where are you seeing this?


from the website above :

"Accounting Alerts-Direct cash payment, Cash out of Direct Cash"


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## Canuck (Mar 13, 2012)

i don't see any "website above"


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## lakota (Apr 3, 2009)

Canuck said:


> i don't see any "website above"


http://www.veritascorp.com/home/

Veritas Website - Full Description of Report Accounting Alerts - DirectCash Payments Inc. - (TSX - DCI) Cash Out of DirectCash We believe that revenue and cash flows from DCI's legacy businesses will deteriorate rapidly in the near term. We rate DCI as a Sell and have added...


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## Canuck (Mar 13, 2012)

are you still seeing the bid/ask?


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## lakota (Apr 3, 2009)

Canuck said:


> are you still seeing the bid/ask?


yes,it went down to 13.70 but then came up back to 14.10


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## HaroldCrump (Jun 10, 2009)

Investors are probably adjusting their asks and offers as news breaks, or as they are reading the details of the announcement.
Once the trading halt is lifted, that's when the true picture will emerge.


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## Canuck (Mar 13, 2012)

is there a chance the halt won't be lifted before the market closes? seems like a long time without some word from management


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## HaroldCrump (Jun 10, 2009)

Yep, halts can last for the rest of the trading day.


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## lakota (Apr 3, 2009)

http://www.menafn.com/387076f3-a414...nts-Inc-Responds-to-Trading-Activity?src=main

DirectCash Payments Inc. Responds to Trading Activity

CALGARY, ALBERTA, Sep 19, 2013 (Menafn - Marketwired via COMTEX) --DirectCash Payments Inc. ("DirectCash" or the "Corporation") has been asked by the TSX and IIROC Market Surveillance to comment on the Corporation's recent trading activity.

DirectCash's management is unaware of any undisclosed material changes or corporate developments in its existing operations that would account for the recent decrease in the Corporation's share price.


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## PatInTheHat (May 7, 2012)

lakota said:


> http://www.menafn.com/387076f3-a414...nts-Inc-Responds-to-Trading-Activity?src=main
> 
> DirectCash Payments Inc. Responds to Trading Activity
> 
> ...


I find this incredibly hard to believe although it's certainly going to make for an interesting day tomorrow


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## doctrine (Sep 30, 2011)

I look at DCI every 5-6 months it seems, including just a few weeks ago, as it is a high yield small cap which is an area that I like. However, I did not find much to like in their financials so it is not a buy for me. I thought there might be a dividend cut announcement which caused this, but apparently not. Still, I wouldn't buy even at this lower level although it might bounce back.


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## 1sImage (Jan 2, 2013)

Wow not good, not good at all.


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## PatInTheHat (May 7, 2012)

Well i've looked over some summary's of the Veritas report and I see no new information that wasn't already available in their last financial statements. Obviously the results are not 100% rosey but it's nothing we didn't already know. I have a feeling this entire thing has been hugely blown out of proportion however the outlook of the stock and the credibility is going to take a huge hit from this. I'm still a bit baffled and amazed that this happened from a single report from a company i've never heard of that apparently has a large enough following to induce this selloff. I think this stock will rebound tomorrow but I expect a turbulent future. I'm planning to hold for now. (I should also disclaimer I have no idea what i'm doing and am fairly inexperienced with stock markets)


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## Jon_Snow (May 20, 2009)

Ok, who bought some DCI this morning? I plead guilty. :biggrin:


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## PatInTheHat (May 7, 2012)

Jon_Snow said:


> Ok, who bought some DCI this morning? I plead guilty. :biggrin:


I wish I had been available to do the same. Well played sir!


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## Jon_Snow (May 20, 2009)

Not countin' my chickens yet... this was a pure speculative play on my part. If this stock drifts a bit higher over the long term, and they don't cut the dividend, I will be happy with that. Of course, I've mentally prepared myself to take a bath on it.


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## lakota (Apr 3, 2009)

Jon_Snow said:


> Ok, who bought some DCI this morning? I plead guilty. :biggrin:


bought 300 x 16.43
600x 15.91


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## 1sImage (Jan 2, 2013)

Well at least it went up a bit today.


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## 1sImage (Jan 2, 2013)




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## Jon_Snow (May 20, 2009)

I used one of these today.... Helping my new stock out, one withdrawal at a time!


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## PatInTheHat (May 7, 2012)

Fortunately it got low enough that I double down today at $15.62

I'll be looking for a possible exit in the $17-18 range but totally happy just sitting tight and collecting dividends for a while.


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## HaroldCrump (Jun 10, 2009)

Those that hold this stock, or have bought recently - aren't you in the least bit worried about the circumstances surrounding this?

The hedge fund/equity group that initiated this slide - Veritas - are a little bit like the Muddy Waters guys.
They find companies with unsustainable finances (or outright frauds), short sell the heck out of it, and then release reports in the media - leading to further selling.
Their previous success story was Just Energy (JE).

Anyhow, what they are claiming (Veritas) is partially true - that govt. regulation may change, fundamentally impacting this company.
All provincial governments are looking carefully into these types of companies.
For a similar case study, look into what happened to Cash Store Financial (CSF) earlier this year.


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## doctrine (Sep 30, 2011)

I would be very careful. If you look at their financial reports, the numbers are not good at all. They have $270M of goodwill and intangibles, which compares to $262M of market capitalization after this recent fall. That should be a huge warning sign for anyone. They might pull it off, but I wouldn't get involved, I prefer my money in businesses with a more stable base. They may have bitten off more than they could chew with their expansions.


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## lakota (Apr 3, 2009)

HaroldCrump said:


> Those that hold this stock, or have bought recently - aren't you in the least bit worried about the circumstances surrounding this?
> 
> The hedge fund/equity group that initiated this slide - Veritas - are a little bit like the Muddy Waters guys.
> They find companies with unsustainable finances (or outright frauds), short sell the heck out of it, and then release reports in the media - leading to further selling.
> ...


 Cash Store contribution to revenue less than 10% across all business lines


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## PatInTheHat (May 7, 2012)

HaroldCrump said:


> Those that hold this stock, or have bought recently - aren't you in the least bit worried about the circumstances surrounding this?
> 
> The hedge fund/equity group that initiated this slide - Veritas - are a little bit like the Muddy Waters guys.
> They find companies with unsustainable finances (or outright frauds), short sell the heck out of it, and then release reports in the media - leading to further selling.
> ...


I imagine I should be more concerned about this seeing the report will have a massively long term downward impact on the share price. I'm finding it hard not to see the value at current levels but pretty tough to fight the market. Perhaps it would be best to sit on the sidelines a bit and invest this money elsewhere until the smoke clears. I sold a little at 16.05 to hedge myself.


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## PatInTheHat (May 7, 2012)

"BMO cuts target to C$18.50 from C$21; rating market perform"

I imagine this is fuelling todays pop back up to helping it find a base. I'm going to be very tempted to cut this stock if it breaches 17 and take a very acceptable loss considering the situation.


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## sags (May 15, 2010)

I am not sure if it is the same Direct Cash company..........but it appears to be.

The large payday loan lender known as Cash Stores or Instaloans, is in serious financial trouble.

They are facing a plethora of government judgements (already rendered) and future class action lawsuits from both customers and investors.

The Cash Store charged more than the legal amount of interest on the payday loans, by requiring customers to take their loans in the form of debit or charge cards. They cost a fee and were distributed by a company called Direct Cash.

I read the business from the Cash Store represented about 25% of total revenue for Direct Cash.

The Cash Store has no chance to win any of the lawsuits...........and are destined for bankruptcy, in my opinion.

Perhaps this explains the downward pressure on Direct Cash?

I could be wrong.........perform your own due diligence.

Edit......I see Harold already mentioned Cash Store in an earlier post.


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## 1sImage (Jan 2, 2013)

^

Do some research on this company, see what they actually do and are involved in. Where they make most of there money from.. the type of things they sell and rent.


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## Jon_Snow (May 20, 2009)

Glad I held on to this... It's in rally mode.


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## sags (May 15, 2010)

Cash Store is down...........Direct Cash is up............short covering?


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## PatInTheHat (May 7, 2012)

I have now exited my position on this one and have started a small short position (mostly as a learning experience as I have never shorted a stock before)

EDIT: Appears this rally was entirely caused by it being a top pick on BNN


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## 1sImage (Jan 2, 2013)

Major deal today...

Trading haulted

http://online.wsj.com/article/PR-CO-20131028-908684.html


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## doctrine (Sep 30, 2011)

950,000 shares to be issued at $16 a share. That's a long way off from their 52 week high of $27.80.


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## PatInTheHat (May 7, 2012)

Not sure how it's up so much today on that news but certainly is interesting. I'm very fortunate I closed my short position a few days ago. Looks ripe for another short but with earnings so close i'm not sure I want to play that.


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## 1sImage (Jan 2, 2013)

doctrine said:


> 950,000 shares to be issued at $16 a share. That's a long way off from their 52 week high of $27.80.


I heard all those shares sold today @16... All gone.


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## Jon_Snow (May 20, 2009)

Nice capital gain since I bought, $80 dividend in a few days... I've learned to become less skittish about things. Years past, I would have bailed on this weeks ago.


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## PatInTheHat (May 7, 2012)

Jon_Snow said:


> Nice capital gain since I bought, $80 dividend in a few days... I've learned to become less skittish about things. Years past, I would have bailed on this weeks ago.


Planning to hold through earnings?


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## Jon_Snow (May 20, 2009)

PatInTheHat said:


> Planning to hold through earnings?


Trying to anticipate earnings results has never been a strength of mine. I own this stock mostly for the income - which most "experts" deem to be safe. I will continue to hold this for the foreseeable future. I can afford to hold speculative/riskier stocks in my portfolio, and I consider this one of those. We will see what happens.


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## PatInTheHat (May 7, 2012)

Jon_Snow said:


> Trying to anticipate earnings results has never been a strength of mine. I own this stock mostly for the income - which most "experts" deem to be safe. I will continue to hold this for the foreseeable future. I can afford to hold speculative/riskier stocks in my portfolio, and I consider this one of those. We will see what happens.


Normally I would agree with you. I just have a feeling this earnings is going to cause a big shift either up or down. I have no clue which. For income I would agree you are fine here.


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## 1sImage (Jan 2, 2013)

Jon_Snow said:


> Trying to anticipate earnings results has never been a strength of mine. I own this stock mostly for the income - which most "experts" deem to be safe. I will continue to hold this for the foreseeable future. I can afford to hold speculative/riskier stocks in my portfolio, and I consider this one of those. We will see what happens.


It was positive. Look out now!!


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## CPA Candidate (Dec 15, 2013)

I thought I'd bring this back for an update.

In September 2013 Veritas issued a very negative report about how DCI was about to fall apart, including a dividend cut and a $10.50 price target, because one of their major customers was in trouble. When this came out the stock fell from $19 to $15 in a few hours. Since then DCI has been dragged through the mud and recommended as a short by James Hodgins on Market Call. It got as low as $13. It was also shorted by Broadview Capital and other short outfits.

Nearly a year later DCI actually doing fairly well and increased their dividend by 4.3% to 1.44 per share at a current price of ~$16. The yield has been around 9-10% for most of this year. The latest Q2 report has the funds from operations payout ratio less than 50% over the first half of the year. DCI's operations gushed 40 million dollars of cash in the 1st half of 2014 and paid dividends of 12 million. Free cashflow was 36 million in the first half of 2014.

So what is the moral of this story? Beware of people who attack companies with incomplete, faulty or downright predatory analysis looking to profit from it. The detractors made claims of the importance of a single customer to DCI that were overstated. Second, dividend yield is not indicative of the ability to continue to pay the dividend by itself. This tends to be the mantra of the DIY investor. DCI has been priced for a cut for nearly a year and raised their dividend, the polar opposite of what the market thought should happen.


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## truegrit (Aug 21, 2014)

Cash store went out of business in Ontario, supplier of ATMs and there may have been some of liability to the Cash Store loans. That accounted for a significant portion of their revenues which may affect Q3/Q4


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## CPA Candidate (Dec 15, 2013)

DCI has received an offer to take the company private for $19 a share, about a 48% premium to Friday's closing price.

It's been over 3 years now since they were given a sell rating and $9 target. There used to be a significant short interest in the stock and anyone short today is feeling the pain.


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## Market Lost (Jul 27, 2016)

CPA Candidate said:


> DCI has received an offer to take the company private for $19 a share, about a 48% premium to Friday's closing price.
> 
> It's been over 3 years now since they were given a sell rating and $9 target. There used to be a significant short interest in the stock and anyone short today is feeling the pain.


Do you have stock? If so, congrats. I had this on my radar a long time ago, but it just seemed to small, and didn't think they had much chance to expand.


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## doctrine (Sep 30, 2011)

Cardtronics is huge, almost 10 times the size of Direct Cash in terms of # of ATM's. Most investors in this company would have made money except for perhaps anyone who bought at the highs in 2013 and never averaged down. And so disappears another nice small cap income stock in Canada.


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## hollyhunter (Mar 10, 2016)

Moody's reviews DirectCash's ratings for upgrade on acquisition announcement. On watch for clear above 19.05


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## manja (Oct 9, 2016)

*Timeline to exit DCI*

Assume Cardtronics will provide Share swap but not listed in Canada, so will with allow the existing shareholders chance to cash out ? Will DCI continue to pay dividends until sale is finalized ? Many questions but no answer to be found.


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## yyz (Aug 11, 2013)

Why don't you email the president of DCI his email address was listed as the contact for more information in the press release

Contact Information - DCPayments:
Jeffrey J. Smith
President & Chief Executive Officer
403-387-2101
[email protected]


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## Mechanic (Oct 29, 2013)

I see this company finally got sold and my shares were bought out. Has given a nice dividend for the 3 years I've had it and a small profit on the sale too. Now I have to look for something o replace it.


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## hollyhunter (Mar 10, 2016)

Bullish cross in Stochastic oscillator and RSI stands at 78.80 level with positive bias.


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## yyz (Aug 11, 2013)

^

Uh Wasn't this deal closed and the stock delisted a week ago?


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## CPA Candidate (Dec 15, 2013)

yyz said:


> ^
> 
> Uh Wasn't this deal closed and the stock delisted a week ago?


Holly Hunter is some sort of bot.


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## zylon (Oct 27, 2010)

*off topic*

Deleted - moved to FNV thread.


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## yyz (Aug 11, 2013)

CPA Candidate said:


> Holly Hunter is some sort of bot.


Ok so how did it get to be a member?


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