tag:blogger.com,1999:blog-3686764185628666543.post5757991188750529929..comments2023-10-10T03:26:30.831+13:00Comments on Share Investor: Xero Set for surprise to the Market?Share Investorhttp://www.blogger.com/profile/02150520236094812434noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-3686764185628666543.post-13428818238422447892010-04-01T18:39:12.785+13:002010-04-01T18:39:12.785+13:00I agree Darren that the stock is over valued at a ...I agree Darren that the stock is over valued at a current market cap of around $145 million. To justify that number you have to assume some massive uptake at reasonable ARPU. <br /><br />My calculation was very simple - 17,000 customers = $3 million in revenue. Costs based on last published accounts plus additional costs of staff etc indicates annual costs of around $12 million. Based on that 30k users are not going to give break even. The alarming trend has been that the average revenue per site has progressively gone south from the $75 per site per month at IPO to the sub $20 mark it is now. The personal version at $5 per month wont help matters. On the other hand costs have only gone north. <br /><br />I remember a story from my childhood about an Emperor and his new clothes. <br /><br />Anon 2Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-3686764185628666543.post-76787847829929445602010-04-01T16:39:28.954+13:002010-04-01T16:39:28.954+13:00Yeah I agree, looks like a disappointment and also...Yeah I agree, looks like a disappointment and also looks like the tipster didn't know what he was talking about.<br /><br />The share price did actually spike by 2c on the news but is now even on bigger than usual volume.<br /><br />The figures appear to be poor, especially when you factor in that the tripling of revenue correlates to the number of customers gained and little, if any, extra business gained per customer.<br /><br />You reckon Anon 2 that 60000 is break even, while another commenter thinks 30000 is the approx figure.<br /><br />Either way that cash is going to be used and given the current figures the stock appears way overvalued.Share Investorhttps://www.blogger.com/profile/02150520236094812434noreply@blogger.comtag:blogger.com,1999:blog-3686764185628666543.post-33081410944811733702010-04-01T13:43:09.073+13:002010-04-01T13:43:09.073+13:00Anonymous I dont think that you have missed out al...Anonymous I dont think that you have missed out all... 17,000 users and $3,000,000 in revenues, so how much is that per user? Say $15 per month. Roughly a million bucks a month in costs, so to get to break even they need 65,000 users. Last six months user numbers went from 12,000 to 17,000 a gain of 5,000 or lets say 1,000 per month. From 17,000 to 65,000 is 48,000 subscribers away or roughly 48 months away. Cash in bank will probably be around $20 million which is two and bit years of cash left. The last capital raising was at the 90 cent mark, current price $1.65. If you are a believer, then you may get a chance to buy in at price less than the $1.65 that is currently being paid. Plus there was no spike on the release of the actual numbers at 17k and not the 20k tipped. Personally I cant see any reason why the price will go any higher than what it is now, which values the business north of $140 million. But then my profile says that I am conservative!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-3686764185628666543.post-37639685423272089732010-04-01T07:08:42.452+13:002010-04-01T07:08:42.452+13:00Missed the tip. A good chance passed me by:)Missed the tip. A good chance passed me by:)Anonymousnoreply@blogger.com