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04:57
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Originally posted by GazM:
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I bought TNE in Feb 20 with little research because they seemed to have a sound history. My plan was to do more thorough analysis soon after but as Covid 19 hit my attention was distracted until recently. I have only just read some threads here & felt it worth a contribution.stand out issue that concerns me greatly in TNE's financial reporting. That is, the temporary effect on reported profit due to changing from expensing development costs to capitalising them. We need to always know how companys are traveling & trending & this change made comparisons hard.
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I agree with your calculations, and had done the same myself. I hadn't articulated as well as you. I think TNE will continue to be a successful company, but think the price factors in significant growth, and the numbers don't reflect that quantum. I have a view that capitalising research and development is the right move as it refects the asset they are building, but the timing of this in TNEs case really muddied the water, and this is their most significant cost. As they are depreciating over 5 years and only started, it will take 5 years to truly see the real picture.
(20min delay)