Bleecker Street out with a report on the short case for Viggle Inc (NASDAQ:VGGL)

Why Viggle Inc (NASDAQ:VGGL) is a short, a CEO with a history of shareholder destruction, the stock being promoted by “Small Cap Street,” and numerous other issues.

Viggle declining user growth

Viggle: What Do Employees Say?

  • “Smart and vibrant team, shamefully wasted”
  • “The product no long works well, and is an outright embarrassment (see the reviews) the user base is plummeting.”
  • “Misery and frustration is rampant among staff”
  • “I’m not optimistic about the outlook for this company”
  • “Sinking Ship”
  • Pros: You work in a great neighborhood.
  • Cons: You work for Viggle, the worst company of all time.
  • Advice to Senior Management: Respect human beings.
  • “Development team is poorly managed and developers are not respected or trusted by their own management (treated more as resources than as people.”
  • “Management creates unrealistic schedules and timelines and promotes them as accurate throughout the company, then blames developers when dates aren’t met.”

Source: Glassdoor

Valuation

  • Viggle Inc (NASDAQ:VGGL) currently trades at $5.73
  • Market cap is $79 million
  • This puts Viggle’s P/S ratio at 4.59

Base Case

  • Base Case (Viggle trade in-line with entertainment stock peers)
  • Viggle Inc (NASDAQ:VGGL) P/S: 2.48
  • Implied Share Price: $3.09
  • Downside: -46%

Bear Case

  • Bear Case (Viggle trades in-line with S&P500 P/S)
  • Viggle Inc (NASDAQ:VGGL) P/S: 1.56
  • Implied Share Price: $1.95
  • Downside: -66%

Why Viggle Inc (VGGL) is a Short: Up To 66% Downside