LounginMKL Posted December 10, 2015 Share Posted December 10, 2015 I noticed many value investors are drawn to secular declining businesses (myself included). We all like to buy things cheap but looking at the recent price drop of Outerwall, who owns Redbox, made me think- what is the end game (exit strategy) for declining businesses that investors are looking for? I guess the typical answers are: 1) Big one-time dividend and/or hiking up dividends that return cash to stockholders over time 2) Exit by selling the entire business with a nice control premium 3) Market suddenly musters the courage to pay more than what you've paid (greater fool?) Many are probably banking on option 3, given the management's disincentive of picking the first two. I'm not knocking on those who invest in secular declining businesses but I'm trying to understand the thinking behind those who invest in this part of the universe and whether there are case studies that demonstrate success? Link to comment Share on other sites More sharing options...
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