To all,
It is amazing how quiet the NXTL thread has been over the past couple of weeks. Equally amazing has been the tight range of NXTL's price range and the low volumes traded. Even our prolific, laconic, philosophical (and whatever other Greek - positive - word you want to use) Arnie has been conscipiciously absent. We all know that Al has sold his position but his is larking in the background, Mr. Smart is diverting our attention with his literary excursions (I must admit talented), Mr Ed still trying to figure out what he wants to do when he gets off the fence, and etc. Since the thread has become boring, it is time for some larkers like me (who, by the way, I have had my hands more than filled since my bank is in the middle of a merger), to come forward and, hopefully, stimulate some interesting discussion.
Let me start by stating the obvious. Everybody is expecting the annual meeting (unfortunately, I will miss it because, although I live in DC, I will be out of the country that week). Clearly, this will set the tone for the next couple of weeks, as everybody is looking from management some guidance, a progress report card, and possibly some further insights, as to what (and how well) we are doing. In the meantime, we are all bitting our fingers watching the capital spending (and the expenses associated with signing new customers).
Sometime towards the end of the quarter, speculation (around June) will start as to what the number of new subscribers will be. Of course we all hope for HUGE NUMBERS!!!. Associated with this speculation is developments in the international front (Brazil, Mexico, etc.). But, guys, let us not lose sight of the initial game plan. The domestic market is where the battle takes place. The international front is an added bonus! It should not alter (or substitute) the basic domestic case. It should supplement it. As a shareholder, I still want to see the payout of the initial game, i.e., the domestic (and most important market).
We now come to July when quarter numbers are coming out. Barring new developments,and assuming we have sub #s up to expectations (hopefully better!), what happens? The stock price does not go anywhere unless we have sub #s significantly better than the previous quarter (i.e., >400,000, and most likely more than 425,000). Of course, the other other significant indicator is going to be cashflow. At some point, we should be seeing some significant improvement in the cashflow front. Subs, etc, are all nice, but at the end of the day, as shareholders we have to ask the basic question, i.e., what is in for us.
So, barring that, we should be looking in the 4th quarter, ie., past end September, when we should start getting some news about the cashflow before interest, depreciations and taxes (EBIDT?). Speaking for myself, guys, this is the moment of truth. If by the end of 1998 this company does nor turn EBIDT positive, WE (the shareholders) got a problem!!! We can talk about Brazil and etc, until the cows come home. But if NXTL does not become cashflow positive on EBIT basis we got major problems and the 22 million holders of shares sold short will have a party on our bill!
Net all in all. Waiting and nail biting time! I guess time for reflection and solicitation of views with the above senario...
Patient (since 1994) and nervous (nail bitting) Tavros |
