Post by
gibbonsj on Feb 28, 2017 9:09pm
charm7: the issue is about the need to take on debt not MLS
One camp (management/insiders) says stay lean grow thoughtfully in Europe, SA, Japan and China while the other camp (mostly analysts) say take on significant debt while its cheap and get out there and compete. Buy clients like BAMTech has done, do accretive acquisitions THINK BIG. I want to agree with the latter camp because it produces rapid growth which is exciting but I realize OTT is not yet ready for prime time so timing of a launch into the big BAMTech type league is something to consider carefully. BAMTech is not going to see profits for a long time whereas NLN is on the cusp of it. Maybe this q depending on the cost of added sales personnel and Saffron overhead. Many impressive new accounts have been added so revenue growth may offset previously mentioned expenses to a large extent. I also don't think debt is going to deter potential buyers, it would seem to be all about the number of eyeballs. We've all heard big numbers when it comes to NHL website visitors but translating those visitors into paying OTT subscribers is not happening at a significant rate. When you look at the cost of supporting NHL OTT including the websites it is massive, something only those with very deep pockets and a long term view can do so to get into that game and hold the accounts means negative eps and growing debt until until the subscriber base grows exponentially enough to turn a profit. Say 5 to 10 years. The arguments for both approaches are strong however since insiders/management hold a huge majority of the shares what we see and think does not matter. For all we know NLN may have already turned away suitors, they are under no obligation to notify shareholders of such an event. We're at the mercy of insiders which is not exactly a confidence booster if investors do not know the game plan. Something to measure preformance against. All we have now is revenue and eps which is not enough. Tomorrow will be interesting. I hope some very pointed questions are asked like where are we going and what is the plan to get there? In the absence of a clearly communicated strategy the optics would seem to be that we are floundering. This not MLS is the issue.
Comment by
charm7 on Feb 28, 2017 11:08pm
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Comment by
gibbonsj on Mar 01, 2017 12:24pm
Could be but its a big market and plenty of fish in the sea. The question is can NLN compete? I think no problem because they have a great product and service. It is ranked among the best. Continue adding eyeballs and someone will step up to plate.