Xro - xero

[Goldstein]

More importantly. It has to CONSTANTLY evolve.

Constant evolution = massive resource requirements = limited profitability.

That's true. However, I would hope that the Xero developers have built a software platform that can be configured easily by a non-developer before release. If every tax change required a coding change they would be in trouble, but surely it must have been designed with this in mind.

[BFG]

The real test here will be if Xero needs another caputal injection. It's done great over the past 5 years bull run. But how will it perform if funds are needed in a bear market? I don't think Thiel & co would let themselves be diluted down or reduce their stake. Interesting times ahead...

[Beagle]

More importantly. It has to CONSTANTLY evolve.

Constant evolution = massive resource requirements = limited profitability.

You're on to it. Tax law is constantly evolving. Anyone who thinks one day they can suddenly make most of their expensive programmers redundant is dreaming.

[tim23]

They keep saying the fall has been on light volume, hardly - often several hundred thousand daily, hardly light given its still one of the higher priced stocks on the market?

[Goldstein]

I wouldn't be so sure, Goldstein. Changes in tax laws are very hard to predict, let alone accommodate ex ante in code.

This is the sort of detail I'm short on with this stock. If as you say NG, it is essentially an ongoing development effort, then I wonder what sort of market share they would need to make the company profitable and sustainable going forward.

They've got a very good product, but it isn't a disruptive technology - there are alternatives out there.

I've just noticed something interesting. If you look at Intuit's share price from April to September it rose about 18% while XRO fell by 29% over the same period. The relative difference in performance is rather large. I can't quite understand why Inuit's share price did so well during the year with XRO entering the market. What am I missing?

[mayday]

so now .com wasn't kidding
Attachment 6370

[nextbigthing]

so now .com wasn't kidding
Attachment 6370

Are you allowed to buy stock whilst in jail?

[mayday]

full version
http://www.nbr.co.nz/opinion/dotcom-...es-dropping-ck

[couta1]

You may be missing the fact that xero's recent SP action reflected a global overcooking of the market and was completely out of step with its underlying fundamental "value."

To put it slightly differently: $45 was bat**** insane. $17 is also ridiculous. Like. absurd. $5 looks like a worthy opportunity.

So Thiel&co are that dumb and unsavvy that they would poor millions into a company and buy shares at $18 when they are only worth $5??? Thiels net worth increased from 1.2 billion in 2012 to 2.2 billion in 2014 so like I said he must be pretty unsavvy aye, Hmmmm

[Santiago]

So Thiel&co are that dumb and unsavvy that they would poor millions into a company and buy shares at $18 when they are only worth $5??? Thiels net worth increased from 1.2 billion in 2012 to 2.2 billion in 2014 so like I said he must be pretty unsavvy aye, Hmmmm

It's a good point. I'm assuming he, and the others, did some pretty hefty due diligence. And I reckon they're in for the long term (I wouldn't be too worried about those guys dumping shares over the next few months). And given they have skin in the game, I reckon people like Theil will be using their connections to push this thing along in the US especially.

Comments like the $5 one above, and the share price action over the past 12 months I think show that in NZ we have no idea how to value this sort of company. It has definitely been overvalued ($45) and I would say $5 is somewhat undervalued. I'm wondering if it has been oversold based on global fears and very reasonable concerns about the U.S. strategy. If you can get out of our quite small NZ mindset, a global SaaS company growing at 80% a year and that has executed largely to plan valued at US$2b could even be regarded as cheap (bearing in mind growth and potential far outweigh dividends and profit in terms of the market valuing this sort of business). Depends if you see the doubt as a risk or a buying opportunity... I'd still wait, personally, though looking at the volumes the last few days there is plenty of money piling in (it'd be great to see how much of that is from offshore- my guess, and I may be wrong, is that right now NZers are selling out of fear, and the shares are being snapped up by overseas interests).