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NetEase, Inc. Message Board

  • sunwyboy sunwyboy Jul 31, 2003 7:18 PM Flag

    Serious question to longs and shorts...

    If this company is throwing off large amounts of cash, has profit margins in the high 70%'s, is growing at triple digits, and has no debt, why is it filing to issue convertible notes?

    I can see no reason for it. It is not like $25 mill is going to make any big purchases.

    What could be the real reason?

    Thanks for the input.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • I thougth the debtor had to option to request up to $25 mil in additional and that the zero interest debt would act like an option for the debtor.

      My understanding.

      • 1 Reply to digitalmachine2004
      • My question is why do they need this money? What's $25 mill to these guys with such high margins and no debt? Who are they going to aquire with a paltry $25 mill when their stock is great currency at these levels?

        Here's a thought that came to me as I write this. Maybe they are going to use the money to buy the software maker that is giving them their software for free. It is a company which they probably already own (like ENE). That way they can run expense through the dummy company to pump up margins and then take a loan on their pumped up stock to pocket on the dummy company purchase. Kind of like taking money from your investors to buy something you already own from yourself.

        Sound familiar?

    • Because by the time they can actually sell the stock to raise cash for that kind of purchase (acquisitions), the stock will be down to $15 a share.

      I can see the headlines. "NTES STOCK HALTED TRADING PENDING SEC FORMAL INQUIRY AND ARREST WARRANT FOR THEIR TOP MANAGEMENT."

      And then, whamo! down 85% for the day. Let's see that would mean the stock goes fro $50 to $7.50 - where it belongs.

      Then come the lawsuits and class action, then comes the disolving of the company. Whe benefits? The folks acquiring the assets.

      See you in single digits.

      The numbers are not and cannot be real.

      How could they have 120mil users when there are only 68mil internet users in all of China?

      I know how, faking the numbers and counting multiple duplicate users as single source users.

      Guess that's how their accounting is done too.

      • 2 Replies to lethalbeefinjection
      • Don't shorts all tied up in a knot. Just send us the url with the only 68 million internet user number or go away.




        "Because by the time they can actually sell the stock to raise cash for that kind of purchase (acquisitions), the stock will be down to $15 a share.

        I can see the headlines. "NTES STOCK HALTED TRADING PENDING SEC FORMAL INQUIRY AND ARREST WARRANT FOR THEIR TOP MANAGEMENT."

        And then, whamo! down 85% for the day. Let's see that would mean the stock goes fro $50 to $7.50 - where it belongs.

        Then come the lawsuits and class action, then comes the disolving of the company. Whe benefits? The folks acquiring the assets.

        See you in single digits.

        The numbers are not and cannot be real.

        How could they have 120mil users when there are only 68mil internet users in all of China?

        I know how, faking the numbers and counting multiple duplicate users as single source users.

        Guess that's how their accounting is done too."

      • That is the point of my question. There is too much unknown with these guys and the numbers given just don't add up. I can't imagine any reputable broker house having anything to do with these guys. This China bubble is a bubble all to itself and can easily be followed. I am enjoying the saga as it unfolds and also believe the hammer is going to fall on one of these guys hard and all hell will break loose.

        Its like people forget that YHOO and AOL are in China too. YHOO and AOL are in the richest markets in the world and yet all these China stocks are making such higher margins. Something is afoot. Will be fun to watch.

    • it is always a good thing to have more cash on hand!!! and the reasons are 1) prepare to buy other good companies in China for its business expansion.
      2) earn interest from saving, hahahaa
      this will increase its Q3 income, great!!!!!!!!!

    • it is always a good thing to have more cash on hand!!! and the reasons are 1) prepare to buy other good companies in China for its business expansion.
      2) earn interest from saving, hahahaa

 
NTES
84.99-0.71(-0.83%)Sep 29 4:00 PMEDT

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