$6 might be way too much to pay for msb soon, page-5

Hi guys, hope this helps.
These figures are a bit out of date now.
I suspect the cash is less than $263m by now and I eagerly await the newest financial report when it comes in.

Millions (AUD)
Total Assets $763.25
Goodwill $109.74
Total Intangible Assets $475.33
Total Cash Equivalents $263.23
Total Liabilities $247.41
Total Interest Bearing Debt $0.00
Total Equity $515.84

On a per share basis, assuming 280m shares
The company has about $1.84 per share in equity, but has intangible assets to the value of $1.70 per share.
So from a liquidation point of view, if the assets of the company are bought up, you have only $0.14 per share of tangible assets. Patents don't really make money either, they just serve to stop others so it's not a huge help come liquidation time unless your product is a sure winner.

Trading at $6 is trading at more than 3X equity (or book) value and with no defined solid revenue stream, it is clear to me that the market is already pricing in high growth for MSB revenue.
Here are the past years return on equity.
-40.2% -29.0% -37.2% -34.7% 38.2%
2007 2008 2009 2010 2011

So of the last 5 years, they burn around 30% or more in four of those.
However, in 2011 they weren't a net burner of equity.
Instead the company actually reported a profit, (not from its operations but rather from the equity injection it received), which is not a sustainable way to make money. You can't sit and hope that someone finances you whenever cash is low, particularly when your phase 2 trials yield very inconsistent results. If the heart failure trials goes to phase 3 and there is no more capital raising before then I would be very surprised. I personally think that blowing the cash balance on a phase 3 trial would be the riskiest proposition ever because that means make or break for mesoblast's cash position. If it works, great. But if it only works as well as phase 2, I think it's the straw that pushes the stock down to 0.14c.

So in other words I see another equity raising soon (before the cash position is burnt down).

That's all my opinion. DYOR