Hannover House Inc (HHSE)

[now invest]

CASH FLOW... and Company stock price worth...

A couple of comments have been made... One ... has anyone done a DCF analysis to determine the Cost of capital.. AH.... A DCF model USES THE COST OF CAPITAL AS THE SOURCE OF DISCOUNTING... NOT TO DETERMINE IT !! FACT !! The Cost of CAPITAL... is the Weighted average of... Cost of Equity and Cost of Debt... !!! The Debt cost is easy to determine.. the Equity portion is more of a knowledge/Market based analysis and can be difficult in a company like HHSE... therefore any real DCF study on a project or the company as a whole... should run have sensitivity analysis as a basic part of it...

Second.. Talk of CASH accounting?? Well there are standards on how earnings need to be reported... no company can just decide to make up their own method for reporting... That is why Accounts have to sign that they used the proper practices...

Now having said that... when it comes to value of the stock and the company.... OVER THE LONG RUN.... (early development companies not so much) ... Many BELIEVE THAT THE BEST INDICATION OF VALUE... and the biggest correlation to STOCK PRICE ... IS NET CASH FLOW !!! This is why I want to know more on what the cash flow is at HHSE... and how long before the company can turn to have a Positive NCF.. !!! Excellent book on this subject is "THE QUEST FOR VALUE"

Again.. HHSE is still developing... and like I said with the A/R loans... sometimes these things are necessary in early stages... HOWEVER... THE LACK OF CAPITAL IS ONE OF THE LARGEST REASONS FOR FAILURE.... so... MONEY MUST BE MANAGED PROPERLY.... TRY TO GROW USING A SHOTGUN APPROACH AND OVERSHOOT YOUR AVAILABLE CAPITAL... SAYING IT IS FOR THE LONG TERM.. AND THERE MAY NOT BE ANY LONG TERM !!!!! HHSE.. must watch where they spend their money... and not do so much that they blow it... LET SOME $$$$$ FEED THE COMPANY... Before ALWAYS SPENDING MORE THAN YOU HAVE(NOT SAYING THEY ARE DOING THAT)