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Social Bill Payment Platform PayTap Goes Live At Disrupt, Offering A Flat $1 ...

25.05.13

One of the largest groups outside what I described as financial support is people paying other people’s phone bills…we make this much easier for people to facilitate that transaction as opposed to, “can you give me your account number. The company’s next step is to enable users to pay bills or receive payments from other countries, as it is currently only available in the U. S. After that, Daley said he hopes to broaden the service to let people charitably pay bills for people... PayTap , a shared social bill-payment platform, launched today at TechCrunch Disrupt SF. Users can chip in to co-pay bills online and use social features to aggregate financial resources from friends and family for a flat $1 fee per transaction. The company aims to reduce the cost of transferring money, take advantage of existing social networks to help users communicate, and allow users to track who has paid which portions of bills. In the presentation, Daley used paying for his daughter’s bill at college as an example. They’re able to encourage people to actually pay on time, because they’re getting their family and friends to come in and facilitate that payment. Co-founder Sean-Michael Daley says he originally thought of the idea when he and his brother were trying to coordinate paying for their mother’s hospital bills. Users can pay using credit, debit PayPal or bank transfer, and PayTap sends the money directly to the biller. I mean for a lot of people, particularly billers, they’re sitting there with a  lot of people in bad debts. Daley highlighted the company’s first merchant integration with Amazon during his presentation, showing how people can pick a big item (usually gifts) on Amazon, use Facebook to alert their friends who are chipping in, and each contribute their... He highlighted the relatively frictionless process, as PayTap allows you to choose the payment method and doesn’t require you to sign up. PayTap raised a $500,000 seed round in April 2012 from Precept Capital Management and Sandor Capital. Daley says the company is working with billers to offer PayTap as an alternative payment method, as well as using advertising and partnerships with companies like ORCC , PreCash , DWOLLA , and Akimbo Card to attract new users. A: We’re actually launching here at TechCrunch [Disrupt] so the service will be up and running and people can use it. Q: Can you give me an example of a biller who you think would put this on their website. Daley says they arrived at the $1 flat fee to reduce uncertain costs that users face when sending money through Western Union or Moneygram. He describes the company’s vision as solving multiple problems with current payment methods, explaining that cash and checks aren’t always used the way they are intended and lack visibility. A : It’s a flat dollar fee, so it’s infinitely cheaper than a lot of other methods of sending money. While the payments space is extremely crowded right now , PayTap has done a great job of identifying a space to fill in the market. Daley says the bulk of that time was spent on research and dealing with regulatory and legal processes. Daley says they will release iOS and Android apps in about two weeks. The company’s website and Facebook app is now live.

Source: TechCrunch

Evaluating AT&T's Ability To Pay Its Dividend

25.05.13

Plus, if AT&T wanted to devote all of its operating cash flows to paying down debt (at the expense of reinvesting in its network or returning excess cash flows to investors), it could pay it off completely in less than two years due to its ability... Signs of maturity we are seeing from the wireless communications segment include decelerating revenue growth, reduced numbers of new subscribers, and year-over-year reductions in capital expenditures. We can see that AT&T is able to generate a return on equity well in excess of its direct cost of debt capital and its indirect cost of equity capital, and because its wireless communications business is now seeing the deceleration to growth that... We expect that if the company cannot earn double-digit returns on invested capital with regard to its free cash flows, it is duty-bound to return the excess cash flows to shareholders through dividends and share repurchases. With regard to taxes, investors outside of tax-advantaged investments accounts only have to pay a maximum tax rate of 15% on their dividends from AT&T or the S&P 500 vs. ordinary income tax rates of up to 35% on their interest income distributions... We can conclude that AT&T generates enough cash based on its $34 billion in operating cash flows to service its outstanding indebtedness and to continue returning cash to shareholders through dividends and share repurchases. AT&T generates an average of $34 billion in operating cash flows annually and spends between $17 billion and $20 billion annually on capital expenditures. 5% annual yield on the iShares Barclays (U. S. ) Aggregate Bond Exchange Traded Fund ( AGG ). While an equity investment in AT&T carries more ostensible risk than investing in bonds, we believe that an investment in AT&T offers a superior... This results in annual free cash flows of between $14 billion to $17 billion, which can be returned to capital stakeholders in the form of debt redemptions, share repurchases, and dividends. We can see that AT&T has a solid capital base and generates adequate returns on invested capital in order to pay bond interest, dividends, and net share repurchases. 25 billion worth of net share repurchases in the first six months of 2012, whereas last year it was saving its cash in order to help finance the proposed $39 billion cash acquisition of T-Mobile USA from Deutsch Telekom. AT&T generates an average of $14 billion to $17 billion annually in free cash flows and also pays about $3. Based on the low interest rates on bonds, as well as the risk of interest rates increasing once the Federal Reserve ends its ridiculous monetary easing programs, we believe that AT&T offers a better risk/return prospect for income-oriented... The new AT&T and its predecessor SBC have been paying dividends since 1984, and have steadily increased the split-adjusted dividend in that time. That's because we expect such trends to prompt companies to increase the proportion of free cash flows returned to investors in the form of dividends and share repurchases. While AT&T may not be confused with a growth engine, we believe that the free cash flows generated by AT&T can be utilized at a rate of return well in excess of the 5. 8 billion in goodwill on AT&T's balance sheet), AT&T is able to generate a pre-tax return on tangible invested capital of 17. 5 billion in outstanding debt as of Q2 2012, AT&T is most certainly not debt-free. 58% pre-tax, it should be returning that cash to shareholders in the form of dividends and repurchases. We can see that AT&T's trailing 12 months free cash flows exceeded its dividend payments in the same period by 53%, and AT&T still had $5. 5 billion in outstanding debt for a weighted average cost of 5. In the past 12 months, AT&T generated nearly $16 billion of free cash flows and paid $10. In this article, we will provide further detail on AT&T's wherewithal to pay dividends. 5 billion remaining to use for dividends and share repurchases during this time period. While this may not be the kind of news that growth investors who are primarily seeking capital appreciation want to hear, this is great news for income-oriented investors. We also noticed that AT&T had reduced its YTD 2012 capital expenditures by 7% vs. YTD 2011 levels, and we believe that AT&T Mobility's decelerating growth rates will result in AT&T's capex budget remaining flat regardless of how AT&T doth protest... Part of the reason why AT&T's dividend yield has moved down this year is because of the demand for any little bit of income from high-quality investments on the part of investors. We can see that AT&T generates a pre-tax return on invested capital of between 10. However, even notable investors like Bill Gross have tried their hand at shorting T-bonds. AT&T's Dividends and Its Free Cash Flows. Plus, we believe that the Barclays Aggregate ETF carries significant interest rate risk due to the rapidly increasing national debt. 5% is too low a return prospect, especially when it is subject to ordinary income tax rates. We are aware of how the telecom industry's legacy wireline business is in a mature and declining industry phase, and we are starting to see signs of maturity from the wireless communications segment as well. 3 billion in dividends to shareholders. However, we are more than aware of the fact that AT&T is a large, industry leading blue-chip telecom services firm and is certainly able to access the capital markets for whatever debt or equity it requires. 25 billion in net share repurchases during this time period. we can see that it certainly exceeds the 2% dividend yield of the S&P 500. 5 billion in book value shareholders' equity. 5 billion in outstanding debt and $103. 6 billion estimated annualized bond interest expense. 8 billion in interest expenses in the first half of 2012 on its $64.

Source: Seeking Alpha