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1/ Somerville Brewing filed for Chapter 11 bankruptcy on September 27. The microbrewery, which was founded in 2011, owes more than $1.2M to six lien-holding creditors. Somerville cited “cash flow shortages” and “debt service”.
brewbound.com/news/small-mas…
2/ "Using the DCF framework, you cannot generate much cash from a revenue stream that is saddled with large, variable costs."

Quality of life is improved if your business has high gross margins. Volume can help if gross margins are lower, but it's hard.
google.com/amp/s/25iq.com…
3/ Wilson: "If the product is software and thus can produce software gross margins (75% or greater), then it should be valued as a software company."avc.com/2019/09/the-gr…

A business that can't generate free cash flow with software gross margins doesn't have product market fit.
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More from @trengriffin see all

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Tren Griffin
@trengriffin
"Operators in China and South Korea are mainly using midband spectrum like 3.5GHz for their 5G buildouts, while operators in the US are using bands ranging from 600MHz to 28GHz because there isn't much available midband spectrum for 5G in the US." lightreading.com/mobile/5g/chin…
"Originally, China tried to launch 5G with a Standalone 5G New Radio core. “That didn’t happen,” said Roger Entner. fiercewireless.com/wireless/china… "non-standalone (NSA) version that uses LTE as an anchor ...provides faster internet, but not the bells and whistles that SA offers."
"In the USA, our estimate is roughly a 30:1 ratio between fixed (300 GB per month estimate) and mobile (10 GB per month estimate) data usage." fiercewireless.com/wireless/indus…
Read 3 tweets
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Tren Griffin
@trengriffin
1/ Assume you are impressed by this (as you should be):

"From 1988 to 2018, Medallion returned 66.1% annually before fees. Net of fees, the gains were 39.1%. Estimated trading profits during those 30 years amounted to $104.5B." bloomberg.com/opinion/articl…

How do you learn more?
2/ You put Jim Simons and 25iQ in a search engine and you get my blog post on him: 25iq.com/2014/07/09/a-d… Or you can use the index on the top of my blog and look for his name under the letter "s" (one of 300 posts). 25iq.com/featured-indiv… Simons is after Tupac but before Biggie
3/ “Certain price patterns are nonrandom and will lead to a predictive effect.”

"We look at anomalies that may be small in size and brief in time.”

"We have three criteria. If it’s publicly traded, liquid and amenable to modeling, we trade it.”

Jim Simons, Renaissance Tech.
Read 3 tweets
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Tren Griffin
@trengriffin
"Free Cash Flows (FCF)* were $(1.6)B and $(0.3)B for the nine months ended September 30, 2019 and 2018, respectively. The increase in cash used was primarily due to higher cash used for working capital compared to 2018" ge.com/investor-relat…

reuters.com/article/us-ge-…
"GE’s struggles in recent years—including two dividend cuts largely stemming from deep problems in its power business and financial-services division—have made cash flow the most important financial measure for investors." wsj.com/amp/articles/g…
GE is up on cash flow news. Earnings are only a clue about long term future cash flows. Sometimes earnings are a helpful clue and sometimes (as GE proved) they are misleading. It depends.

"Profits Are an Opinion, Cash Is a Fact." Alfred Rappaport

cnbc.com/2019/10/30/gen…
Read 3 tweets

Related threads

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Swiss Ramble
@SwissRamble
I recently wrote about the importance of the cash flow statement in assessing the financial performance of a football club, focusing on the Premier League. Since then I have had a few requests to do the same for the Championship, so let’s take a look in the following thread.
A club’s profit and loss account is easy to understand, i.e. basically revenue less expenses (mainly player wages), but this is a notional profit based on the accountants’ accruals concept, which can be very different from actual cash movements.
This is important, as the main reason that football clubs fail is cash flow problems. It does not matter how large your revenue is (or your profits are), if you do not have the cash to pay your players, suppliers or indeed the taxman, then you will find yourself in trouble.
Read 41 tweets
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Swiss Ramble
@SwissRamble
One of the questions most frequently asked by football fans is “Where’s all the money gone?” The answer is only partly found in a club’s profit and loss account, so we need to also look at the cash flow statement to get the full picture. Some thoughts in the following thread.
A club’s profit and loss account is easy to understand, as it is basically revenue less expenses (mainly player wages), but this is an accounting profit based on the accruals concept, which can be very different from actual cash movements.
This is important, as the main reason that football clubs fail is cash flow problems. It does not matter how large your revenue is (or your profits are), if you do not have the cash to pay your players, suppliers or indeed the taxman, then you will find yourself in trouble.
Read 39 tweets
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Claire Berlinski
@ClaireBerlinski
Chapter 1: Beginnings. (Klobuchar, for those of you just joining in.)

WHEN EVERYTHING WAS NEW

Born in 1960, begins with a genuinely well-written paragraph about what Minnesota looked like in 1960.
"what were once cow paths had become streets with names like Kirkwood and Evergreen and Jonquil." ...

Every single appliance in the house--from the butter-yellow colored oven to the aqua countertop stove to the side-by-side washer and dryer--
was new, paid for by my dad's GI loan."

Her parents got married when Elvis recorded his first songs. We continue in this vein.

Her mom teaches her to be well-mannered.
Read 45 tweets
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KQED News
@KQEDnews
THREAD: @PGE4Me on Tuesday filed for Chapter 11 #bankruptcy protection, a move the company insists is necessary to contend with at least $30 billion in potential liabilities growing out of the calamitous #wildfire seasons of 2017 and 2018.
@PGE4Me In a simple voluntary petition filed just after midnight Tuesday morning with the U.S. Bankruptcy Court for the Northern District of California in San Francisco, @PGE4Me estimated its liabilities at about $51 billion and its assets at more than $71 billion.
@PGE4Me Despite that solvency, @PGE4Me officials argued that they need the Chapter 11 protections because they are unable to borrow enough cash to cover operating costs.
Read 14 tweets
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Swiss Ramble
@SwissRamble
West Ham’s 2016/17 financial results covered their first season in the new London Stadium. Despite dropping to 11th place in the Premier League, they reported record revenue and profit. Some thoughts in the following thread #WHUFC
#WHUFC improved the bottom line by £48m, as they converted a £5m loss to £43m profit with revenue growing by 29% (£41m) to £183m. Profit on player sales was up £24m, mainly due to transfers of Dimitri Payet to Marseille and James Tomkins to Crystal Palace.
#WHUFC revenue growth was driven by the new Premier League TV deal with a net increase in broadcasting income of £33m (38%) to £119m. Commercial income also rose by £7m (25%) to £35m, while match receipts were £2m (6%) higher in the new stadium at £29m.
Read 33 tweets
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David Blanco
@dblancoen
Best fragments of one of my favorite books. Lessons from some of the best CEOs in history.
1) CEOs need to two things well to be successful: run their operations efficiently and deploy the cash generated by those operations.
2) What counts in the long run is the increase in per share value, not overall growth or size.
Read 26 tweets

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