TNT 0.00% 13.0¢ tesserent limited

Government to increase fines for massive data breaches to a minimum of $50 million, page-55

  1. 5,654 Posts.
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    This is a brilliant analogy, I've said the same things before but you've done a much better job of articulating it. It employs people, pays them well, provides a good service, it's a good company, it's a company I like. But, its bottom line is marginal, so for shareholders it's not great, even though it's good for employees, managers and clients. It's also no good for prospective buyers.

    Where I disagree is the price increase. Increasing prices by 20% would reduce business by more than 20%. You'd lose a lot of those train carriages because while at the moment the TNT train offers reasonable value for the ticket price, a 20% increase would have people catching planes, taxis, the bus, buying private vehicles or not travelling at all. They'd lose revenue and have to lay off staff, stop using carriages (in the real world that would be closing offices).

    For management, employees and clients, it looks like a good company going forward. For shareholders it looks iffy, and if dilution becomes necessary, that train is going to have derailed carriages.
 
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