new to hotcopper, page-56

"So if you believe what you say has no influence on MSB's success, why do you spend so much time hear? Do not under estimate the power of social media."

@Bazsa,

Flattering though that may be, I am fully aware of my limitations in terms of being able to influence outcomes for MSB, either in terms of the underlying performance of the company and its management, or in terms of the performance of the share price.

Because, MSB has some 11,500 shareholders.

In addition to that number, I'll wager that if you take the people around the world who follow MSB, or who receive broker research about MSB, or who come across MSB in any way that might lead to them considering MSB as a potential investment prospect, collectively those non-holders would easily amount to more than five, and probably even ten, times greater, the number of people who already own MSB.

By contrast, compared to those many tens of thousands of people categorised above, I would be very surprised if there were more than a few hundred people who tune into the MSB debate on HotCopper, the majority of whom would have a demonstrably entrenched opinions that are highly unlikely to be changed, anyway, irrespective of what counter-arguments they might encounter here.

So to say that what gets posted here might have some sort of meaningful impact on MSB borders on the laughable.

Nice thought it might sound, the views that we all express here on this forum are not nearly as influential as we think.


"Can you please explain the difference between "Cash Burn" and "Investment in Research"? Does CSL burn cash too."

I think you'll find that "cash burn" is routinely-used financial market lexicon to describe companies with finite capital resources, and which consume those capital resources at a certain rate.

So, don't shoot the messenger; I'm merely adopting an existing industry convention.

For context, in relation to the comparator stock which you invoked, namely CSL: if we take a reasonably representative time frame, of say 5 years, that company generated some $6.5bn in Operating Cash Flow, of which it re-invested $2.9bn back into the business. (One of the results is that EPS has increased by 50% over that review period.)

So, if "cash burn" (as the term is applied by market practitioners) means a net consumption of funds, then - to answer your question - CSL quite patently does not "burn cash" (quite the opposite... it generates such surpluses in capital that it can't spend it fast enough).

By comparison, MSB, over that same 5-year period, generated obviously generated virtually no organic capital, and consumed some $530m.

Which is why when this sort of situation presents itself, people sometimes refer to it as a rate of "cash burn". Not too endearing a phrase, I admit, but it's not something that I made up.

As I said, it has been a long-used metaphor.