A few days ago, I was approved to be an analyst on the World Stock Exchange. In order to do my due diligence before actually reviewing anybody, I started to just look through the financials and posts of all of the companies on the WSE, and I started to see some interesting trends. I wondered to myself: "Self, you remember the relatively few companies that were in the WSE when DDE first went live, and I wonder how the first 25 companies that went public are doing."
So, I cycled through the announcements on the WSE, from the first company's first announcement in March, 2007, to the 25th company's first announcement (which i was gratified to discover was DDE - hehe). Here's a list of the first 25 companies that made a post on the WSE, and their current status. Ah.... the memories that they bring back... Ginko, Montana's, Yellow Paperclip...
|1||Tao Heavy Industries||THI||Active|
|2||The Success Fund||TSF||Bankrupt|
|4||Bob Perry's Store||BOB||Bankrupt|
|7||Touchet Group Corporation||TGC||Bankrupt|
|8||AM Sports Bet||AMS||Active|
|9||Sun Media Consultants||SUN||Active|
|10||Ginko Currency Services||GCS||Bankrupt|
|11||L&L Rentals and Sales||LLL||Active|
|12||Ford Edelman Designs||FED||Halted|
|13||Lotto Networks Unlimited||LOT||Halted|
|14||Action Mortgage and Investment||AMI||Active|
|16||Ginko Investment Fund||GIF||Bankrupt|
|17||Midas Development Corp||MDC||Bankrupt|
|19||Montana's Poker Room||MPR||Bankrupt|
|23||Second Street Parnters||SSP||Active|
|24||True 2 Life Studios||TLS||Bankrupt|
|25||Delicious Demar Enterprises||DDE||Active|
Now, the fact that many of the companies are now out of business is not really a surprise. As Casper Trebuchet pointed out to me yesterday, the speed of SL is accelerated compared to RL, and whereas 50% of companies are out of business within 5 years in real life, it takes considerably less time for the carnage in SL - it only took seven months. The disturbing thing to me was the failure of MOST of the financing/banking companies. Obviously, people that jumped into these industries early, expecting SL to behave like RL, were mistaken, and either simply did not know what they were doing, or misjudged the SL economy and market badly.
So, I did a little more digging on the 13 companies that have actually managed to survive for the last seven months, and decided to look at a few key performance indicators for each. Now, please remember that I am NOT a financial analyst in RL - and I provide these numbers as they are - without any real description of the present circumstances of each company. There are cases in which extenuating circumstances exist (like Ford Edelman Designs, for example, in which the CEO, a US soldier, was posted to Iraq).
The metrics I have used are quite simple - some of them (EPS, PE Ratio, NAVPS) are all standard financial indicators, but I have tried to add a few that are specific to the WSE/SL environment:
- Average Number of Posts per Month: this is a measure of how communicative each company is. although more is not always better, it is interesting that the companies that are successful financially, also seem to have kept their investors and the community more informed.
There are 5 indicators dealing with dividends:
- - total number of dividends posted: this will give you a rough idea of how often they post. Remember the time frame is 7 months.
- - Total dividend per share: is the sum of all the dividends (per share) over the last seven months.
- - average dividend per share: over the last seven months
- - last dividend date: shows how up to date they are with giving dividends
- - last dividend per share: the amount of the last dividend posted - this can show whether the recent dividend is lower or higher than the average - i.e. what direction it is going in.
The rest are pretty self-explanatory:
- average 30 day share price (from Nov 2)
- 30 day trading volume
- Total shares created
- Total shares in float (in which i exclude shares held by the CEO)
- Price Earnings (PE) Ratio: taken from the WSE financials, in which i believe they use the current price, divided by the most recent statement of earnings - so not necessarily always a level playing field on this one. This is a measure of the value of the stock.
- Earnings per share (EPS): again from the WSE financials, except in one or two cases, where i had to dig through the announcements to find the most recent earnings. This is a measure of the potential profitability of the stock.
- Net Asset Value Per Share (NAVPS): once again from WSE - simply the total value of assets divided by the number of shares. This is a measure of the stability of the stock, for some companies.
I will leave it for another post to go into more details on my analysis, but thought that some of you would be interested in seeing the numbers first.
If there is any enthusiasm at all, I will do the same sort of thing for all of the companies on the WSE - rather than picking one specific company to review to begin with. Please feel free to leave comments, questions, observations etc, about either the numbers, or about the post in general.