Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : MicroStrategy Inc. (MSTR) -- Ignore unavailable to you. Want to Upgrade?

To: LTK007 who wrote (602)	6/11/2000 4:15:00 PM
From: cardcounter	Read Replies (2) \| Respond to of 717

Given MSTR's liquidity probs, additional funding will most likely be obtained shortly. It's imperative regardless of how dilutive that financing is the current shareholders. With the current burn rate and co's expansion plans, MSTR wont last 2-3quarter with existing resources. ($13MM cash burned from Dec99 to March31,00) Co was able to reestablish its revolver at $28.6MM and has already drawn down $7.4MM at about 8.56% (libor +1.75) Co's comp lease for $40 MM over 3 yrs is essentially a 8.25% debt instrument..half of which was borrowed at Dec99 Co has 12MM or so in purchase commitments (as of Dec 99) ==== One thing I'm curious about is the "exchange applications" the co got in return for services, software, etc. : I'm assuming these are stock or securities of the customer, is this correct? According to the 10K, about 824,000 shares were received valued at $21.5 MM (perhaps the value of the consideration or the fair value of the shares). Half were sold for about $29.5 MM as of Dec31,99. If the remaining half are or a portion thereof are still held in Current asset accounts, those accounts maybe overstated in that these "exchange applications" may have devalued (given recent market conditions) and may have not been marked to market... In which case the co's current ratio is weaker, which impairs the price and ability to obtain financing.. === Finally, while not a major contributor to revenue -- yet a considerable drain on resources, strategy.com's b2c approach is completely bogus IMO... the biz model of 75% advertising revenue and 25% subscription is absurd... and the whole concept is redundant with whats already out there and what will be available to anyone with a wireless web phone... You can split hairs on some of the services provided vs. whats out there... but I'm looking to split the current value of the stock by a third or even a half...