Hi, stox
Your quote of Metter's comments at the Noble Conference, regarding the company now being cash flow positive, has some here wondering why so many payments are still being made by RME. And the veracity of Mr. Metter's comment has been challenged.
As a shareholder, should I be alarmed by this? Do I have to necessarily accept the naysayers' contention that the company is not, in fact, generating positive cash flow? What considerations are relevant in making a determination?
I'm not concerned. My reasons being, in part, based on the following.
> RME has returned hundreds of millions of shares to the company. Those shares retired and returned to the treasury, according to filings.
> For the next month, the company still has the right to repurchase all remaining shares issued to RME over the last 2 years, at the original purchase price of the shares. This also, according to filings.
> And what is generating such a demand for cash by the company? We know the company has a growth target they are trying to achieve. That growth requiring a significant increase in inventory levels for initial orders to new customers. Also demanding additional manufacturing capacity to produce sufficient product to meet projected re-order levels. Is Walmart likely to enter into a purchase agreement if current inventory levels, and the company's ability to maintain order levels, is less than they require?
Add to the list any acquisitions that may present themselves. Include the cash required to keep the new product pipeline financed. And just how many shares, beyond the announced buyback quantity, might the company have purchased?
We are all painfully aware of the precarious situation we find ourselves in with the SEC. Their perspective backwards-looking.
But we are equally aware that Pike, and the others who will join him, are looking to the future. And I see no reason not to share that future with them.
Thank you, stox, as always.
jay
AI
