share price fall, page-15

I am not talking about near term 6 month cap ex.
I am talking longer term cap ex.

In the next 6 months or so management has given guidance as to a significant reduction in capex. But this is only for the near term period.

Distinction has to be made between near term and longer term.

Management has also quite clearly stated its longer term goal of MH.

So from this its quite easy to determine long term capital commitment.

Its also possible to provide rough back of the envelope requirements by comparing cap ex to price to book value.

This company has always traded significantly above book value.

This enables the company to efficiently raise funds, and yet capital deployment is significantly less than funds raised (due to the variance between price to book value.

I cant emphasise this strongly enough, but during the 'story' stage its the story that counts, that will be the determination for successful capital raising, debt finance etc (but debt finance much less than equity finance).

Once the company moves from concept to an actual business generating profits/cash flow. Then the fundamentals really come into play.

Another extreme situation is to look at new sat. This is a much more extreme example. But look at how well the 'concept' worked in flogging off shares and raising capital. And yet over the many years this concept has been developed, how have the long term shareholders faired???????

But how easy was to flog off those additional shares????
Because the story was soooo good, and yet the financials were many years into the future.

NXT IS NOT A NEWSAT. I merely use this as an extreme example to highlight my point.

But NXT on a current price to book value, is still potentially overvalued given that we don't know how the financials will work out into the future.

That's why I am on the sidelines, waiting.