MicroStrategy Graph and Fundamental Analysis (MSTR)
Updated
1. Graphic Analysis
Since March 2020, the company has been showing a strong correlation with Bitcoin (as shown at the bottom).
The price is "respecting" the white diagonal line in a big triangle 3 times.
It remains to be seen whether this line will be restored or whether it will now take off for good.
Perhaps the fundamentalist analysis below indicates a subtle change in operating results, to the point of enacting the bottom of this cycle.
2. Fundamental Analysis
The result was announced on November 1st.
2.1. Income Statement
2.1.1. Revenues
Sales increased by 2.69%, going from 122M to 125M.
2.1.2. Expenses
Operating expenses have been flat since inception, ranging quarterly from $111 million to $122 million.
2.1.3. Net Income
Net Income shows how much money a company earns after expenses.
Since the year 2020, net income has had a negative performance.
Despite sales increasing by 2.69%, this has not changed.
The positive point is that in relation to the previous quarter, the negative profit deteriorated, going from -$ 1.06 Billion to -$ 27.08 M
2.1.4. Earnings Per Share (EPS)
Earnings per Share is the amount of earnings per share of issued, ordinary shares.
Analyzing since the 1st quarter of 2021, this indicator has remained negative, signaling that those who bought the company's shares suffered a loss, in line with Net Income.
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2.2. Balance Sheet
2.2.1. Asset x Liability
2.2.2. Total Assets
The total value of assets decreased by 2.13%, due to a reduction in current and non-current assets.
2.2.3. Total Debt
Debts remain stable, in the range of $2.24 billion to $2.45 billion.
2.2.4. Net Debt
Net Debt represents the amount of debt that would remain after a company had paid off as much debt as possible with its liquid assets.
This value also remains stable.
2.2.5. Net worth
It is what's left after subtracting total liabilities from total assets.
Equity was positive until the first quarter of 2022.
But in the last two quarters it was negative by -$200 million.
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2.3. Cash flow
2.3.1. Cash From Operating Activities
Cash From Operating Activities represents the amount of cash that a company gets from its ongoing, regular business activities, such as the production and sale of goods or the provision of services to its customers.
Considering the period since 2021, Q2 2022 (the previous one) was the one in which there was a negative flow of -18.37M.
In the current quarter, positively, this negative flow has stopped, standing at $1.10 M.
But still far from the last positive value of the first quarter of 2022 which was $ 46 M.
2.3.2. Cash From Investing Activities
Cash From Investing Activities represents the amount of cash that a company brings in from its investing activities.
It includes any cash inflows or outflows from the company's long-term investments.
A negative value of Cash From Investing Activities can show poor performance, but it can also be a sign of increased investment activities.
Spending on investments has been declining.
From a peak of -11B in Q1 2021, in the current quarter of 2022(3) the amount spent was -6M.
This signals a trend towards the end of investment activities.
It may be due to the higher cost of money, and/or the lack of need for such an investment.
2.3.3. Cash From Financing Activities
Cash From Financing Activities is the amount of cash that a company receives or pays to finance its activities.
That is, the company invests this money in itself, specifically in the development of its business.
A positive value may indicate an organization's intentions regarding expansion and growth.
A negative value may be a sign of improvement in the company's liquidity if debts are paid off.
A negative value can also provide information on the dividend policy of the organization.
In the same way as investment activities, the value follows a downward trend, that is, the company continues to prioritize the consolidation of its activities, or prioritizing the settlement of its debts.
2.3.4. Free Cash Flow
Free Cash Flow (FCF) represents the cash that a company generates as a result of its activities, excluding expenses on assets.
Free Cash Flow is sometimes considered the hardest financial metric to fake because of its calculation and for that reason, it's a popular financial metric in the investor community.
The current value remains positive at 769k, but far from the peak of 664M in Q1 2021.
Last quarter the balance was negative at -19M, so we could at least consider this reversal as something positive.
2.3.5. Price to cash flow Ratio
It measures how much cash a company generates relative to its share price.
Formula:
Market Value/Cash Flow from main activities
The indicator remains positive and peaked at 69.46 in this current quarter.
Since March 2020, the company has been showing a strong correlation with Bitcoin (as shown at the bottom).
The price is "respecting" the white diagonal line in a big triangle 3 times.
It remains to be seen whether this line will be restored or whether it will now take off for good.
Perhaps the fundamentalist analysis below indicates a subtle change in operating results, to the point of enacting the bottom of this cycle.
2. Fundamental Analysis
The result was announced on November 1st.
2.1. Income Statement
2.1.1. Revenues
Sales increased by 2.69%, going from 122M to 125M.
2.1.2. Expenses
Operating expenses have been flat since inception, ranging quarterly from $111 million to $122 million.
2.1.3. Net Income
Net Income shows how much money a company earns after expenses.
Since the year 2020, net income has had a negative performance.
Despite sales increasing by 2.69%, this has not changed.
The positive point is that in relation to the previous quarter, the negative profit deteriorated, going from -$ 1.06 Billion to -$ 27.08 M
2.1.4. Earnings Per Share (EPS)
Earnings per Share is the amount of earnings per share of issued, ordinary shares.
Analyzing since the 1st quarter of 2021, this indicator has remained negative, signaling that those who bought the company's shares suffered a loss, in line with Net Income.
------------------------------------------------------------
2.2. Balance Sheet
2.2.1. Asset x Liability
2.2.2. Total Assets
The total value of assets decreased by 2.13%, due to a reduction in current and non-current assets.
2.2.3. Total Debt
Debts remain stable, in the range of $2.24 billion to $2.45 billion.
2.2.4. Net Debt
Net Debt represents the amount of debt that would remain after a company had paid off as much debt as possible with its liquid assets.
This value also remains stable.
2.2.5. Net worth
It is what's left after subtracting total liabilities from total assets.
Equity was positive until the first quarter of 2022.
But in the last two quarters it was negative by -$200 million.
------------------------------------------------------------
2.3. Cash flow
2.3.1. Cash From Operating Activities
Cash From Operating Activities represents the amount of cash that a company gets from its ongoing, regular business activities, such as the production and sale of goods or the provision of services to its customers.
Considering the period since 2021, Q2 2022 (the previous one) was the one in which there was a negative flow of -18.37M.
In the current quarter, positively, this negative flow has stopped, standing at $1.10 M.
But still far from the last positive value of the first quarter of 2022 which was $ 46 M.
2.3.2. Cash From Investing Activities
Cash From Investing Activities represents the amount of cash that a company brings in from its investing activities.
It includes any cash inflows or outflows from the company's long-term investments.
A negative value of Cash From Investing Activities can show poor performance, but it can also be a sign of increased investment activities.
Spending on investments has been declining.
From a peak of -11B in Q1 2021, in the current quarter of 2022(3) the amount spent was -6M.
This signals a trend towards the end of investment activities.
It may be due to the higher cost of money, and/or the lack of need for such an investment.
2.3.3. Cash From Financing Activities
Cash From Financing Activities is the amount of cash that a company receives or pays to finance its activities.
That is, the company invests this money in itself, specifically in the development of its business.
A positive value may indicate an organization's intentions regarding expansion and growth.
A negative value may be a sign of improvement in the company's liquidity if debts are paid off.
A negative value can also provide information on the dividend policy of the organization.
In the same way as investment activities, the value follows a downward trend, that is, the company continues to prioritize the consolidation of its activities, or prioritizing the settlement of its debts.
2.3.4. Free Cash Flow
Free Cash Flow (FCF) represents the cash that a company generates as a result of its activities, excluding expenses on assets.
Free Cash Flow is sometimes considered the hardest financial metric to fake because of its calculation and for that reason, it's a popular financial metric in the investor community.
The current value remains positive at 769k, but far from the peak of 664M in Q1 2021.
Last quarter the balance was negative at -19M, so we could at least consider this reversal as something positive.
2.3.5. Price to cash flow Ratio
It measures how much cash a company generates relative to its share price.
Formula:
Market Value/Cash Flow from main activities
The indicator remains positive and peaked at 69.46 in this current quarter.
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