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Redrut  

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  • Seadrill: I Stand Corrected, So Now What? [View article]
    because they were to blame for the oil market?
    Apr 27, 2015. 02:55 AM | Likes Like |Link to Comment
  • Nokia to buy Alcatel-Lucent for $16.6B [View news story]
    Phones need what to work? What is the main business line for Nokia? ugh
    Apr 20, 2015. 10:04 AM | 1 Like Like |Link to Comment
  • uSell: An Unknown ReCommerce Marketplace With An Impressive Growth Story [View article]
    Looks like the 66% drop in share-price since this article was published answered my question as opposed to the author
    Apr 20, 2015. 03:20 AM | 2 Likes Like |Link to Comment
  • Apple's Watch Strategy Embraces The 80-20 Rule [View article]
    I'm not sure I get it, are you saying that the $17k watch will make 80% of the profits?!
    Apr 20, 2015. 02:47 AM | Likes Like |Link to Comment
  • Netflix Bull Thesis Is Profoundly Flawed [View article]
    1) Turkey perhaps? Regardless, I don't think age is a serious issue and there is no real evidence that it is. If you want to make a straw man about pensioners, be my guest. Simple fact is there are plenty of people who can use the internet in Europe - we aren't cavemen

    2) I live in Europe, and yes while I made a generalisation, it is still true that a vast number of people do, if they can't speak it fluently, they are learning it in school but regardless a lot of programming is dubbed/subtitled

    5) Yes currencies can bankrupt companies that speculate in currency. MF Global speculated itself to death with bad management and lax compliance. Netflix isn't a bank and although currency fluctuations impact margins here and there, it balances out mid-term

    6) Of course it doesn't but then again I ignored the RoW in my little estimations,

    VPN is interesting but I am not sure how easy it is for Netflix to ban the practice of VPN. Once you figure out a VPN server, you can block it but the VPN can change it's address ad infinitum. It's like saying the UK government can be sued for letting illegal immigrants in, yes its bad and they can try and stop it but we can't have police run along every metre of the coast.

    To the author, I read your article and I even asked you for some more detail on those points. If you were to split US and RoW, what would these trends look like. If you have a mature US and a Europe in investment mode, the high start up costs of RoW on top of the hopefully valuable US business would indeed paint exactly the picture you make above
    Apr 20, 2015. 02:44 AM | Likes Like |Link to Comment
  • Netflix Bull Thesis Is Profoundly Flawed [View article]
    A is obv the amortised cost of content, you are right to include that so take the EBIT of 300m and you had a potential EBIT of 3,040 or a 10x EV/EBIT....
    still cheap

    Let me go through points 1 by 1
    1) Average age sounds like you have only included the eight major countries in Europe as opposed to the faster growth Eastern and Southern European countries which have a younger age. Regardless, a four year age difference is ridiculous as it means absolutely nothing. I could say that older people are more sedentary, have more free time, therefore are more likely to purchase the sub.

    2)Yes they speak about 20 different languages but they all speak English as a second and quite a number fluently. Furthermore, do you think that the cost of the latest Turkish drama series will amount to anything close to 'The Office'?

    3) Cost of NFLX is UK so £6 per month or $9 which is a net rev of 7.2, you can touch my hypothetical down a tad

    4) You anecdotally mention France, did the other download states not paint a bearish enough picture?

    5)Currency effects are a negative, agree with you but currencies don't break a good company

    6)All evidence of European competition shows that Netflix has pretty much crush the majority of them, I point to Maxdome as a case in point.

    7) Netflix UK may have started a year later but the offering was significantly lighter and the advertising a lot lower
    Apr 17, 2015. 11:15 AM | Likes Like |Link to Comment
  • Netflix Bull Thesis Is Profoundly Flawed [View article]
    Have you separated the OCF between US and Intl? Thats surely the key
    Apr 17, 2015. 03:37 AM | Likes Like |Link to Comment
  • Netflix Bull Thesis Is Profoundly Flawed [View article]
    Netflix lets say has 40m subs and 21m internationally. Penetration in the States is at 12% and assuming all international is EU27, penetration is at 4.2% (500m population).

    Therefore, in order to gain the same penetration, there is theoretically another 40m subs to gather in Europe alone.

    Now consider that the cost to provide Netflix is broadly similar regardless of how many subscribers you have.

    Even though Netflix Europe is a light version of Netflix USA, it has still incorporated a huge amount of content which has already been paid for meaning extremely high margins for marginal subscribers.

    The mistake you make here is bundling together a scaled business in the US with a subscale business in Europe.

    If ARPU is $8,these 40m european subscribers will lead to 3.8bn in revenue with a large amount dropping to EBIT. If we assume an 80% drop down, then you have an achievable EBITDA of $5.24bn which is 6x EV/EBITDA

    Not doing anything fancy here but seems as though there is no clear downside thesis
    Apr 17, 2015. 03:34 AM | Likes Like |Link to Comment
  • Nokia to buy Alcatel-Lucent for $16.6B [View news story]
    Yes because no-one uses mobile phones any more, they are so 20th century
    Apr 15, 2015. 07:17 AM | 2 Likes Like |Link to Comment
  • Nokia to buy Alcatel-Lucent for $16.6B [View news story]
    same - not sure if this is a good idea
    Apr 15, 2015. 07:14 AM | 1 Like Like |Link to Comment
  • Special Situation: New IPO Crashes 90% Out Of The Gate On Unexpected Dump [View article]
    I'm simply commenting how amusing it is that you put a link to a news article mentioning your company implying that this somehow legitimizes a buy scenario
    Apr 10, 2015. 09:00 AM | Likes Like |Link to Comment
  • Special Situation: New IPO Crashes 90% Out Of The Gate On Unexpected Dump [View article]
    Enron also got mentioned in the press quite a bit, what's your point here exactly?
    Apr 10, 2015. 02:52 AM | Likes Like |Link to Comment
  • Special Situation: New IPO Crashes 90% Out Of The Gate On Unexpected Dump [View article]
    Na, I'm actually a bottom up investor and a founding member of a reasonably large fund, so I do understand this business to some degree - putting 'LOL' after rebuttals doesn't exactly cast your opinion in a very strong light.

    How exactly do you work out a multiple when the 8k doesn't mention the word 'Revenue' once apart from in the safe harbour. They have acquired a company and don't even give you the revenue figure and you have decided its an incredible acquisition. I think a 'LOL' is surely appropriate.
    Apr 8, 2015. 11:06 AM | 3 Likes Like |Link to Comment
  • Special Situation: New IPO Crashes 90% Out Of The Gate On Unexpected Dump [View article]
    Backing Arthur but the bickering is great fun to read....
    Micro-cap stocks have so much risk and uncertainty that the presence of one red flag or 'oddity' should be enough to warn away any investor. By the sounds of this acquisition and reading the docs, this company has quite a number of red flags...

    Also, why would a company worth $5m be acquiring at all?! It's not a company, it's a product. The fact they are buying another product when they haven't succeeded in their primary set of products strikes me as extremely odd.

    The issue with micro's is that quite a few investors seem to equate them to small versions of large-cap stock when this simply isn't the case. Acquiring during a start-up phase is suspect, simples
    Apr 8, 2015. 06:36 AM | 1 Like Like |Link to Comment
  • Answering Questions About Lumber Liquidators [View article]
    Because that's how investing works?
    Mar 31, 2015. 10:07 AM | Likes Like |Link to Comment
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