Anyone else concerned about MSG’s future?

If I would receive a dollar each time somebody digs out a stock document to predict the end of MSG/ S397, I guess I would be a
millionaire by now. Also quite interesting that we have such a high amount of stock exchange experts in simracing..fascinating.

giphy.gif
 
It's wierd that people haven't learned after all these years that not being listing in NASDAQ is not the end of the world. Companies change names, their form of company and investors on a regular base. Simbin is a prime example for this. Wierd how Sector 3 still keeps developing their product after Simbin folded in 2014. It could very well be that the involved parties have a completely different plan in place allready. Everything that we are doing here is speculation as long as we don't know the details of the different contracts.
 
sigh...
- sorry, no bad press over MSG here please.
- Also I see you're an "expert".
- Also this has nothing to do with us and it will not effect rf2.
- Share prices don't matter here and everything is going acording to plan.
- Also nobody cares anyway, so nothing to see here
- ..."something with million dollar".....idk
/s
/s
/s

I hope I have everything covered so this thread doesn't get flooded again with bullshit from people who, for whatever reason, think they must comment on such posts even through they have nothing to contribute and don't want to discuss this anyway.
 
I used to trade stocks and Forex, I have some understanding about these kind of things but I'm not an expert.
So MSG had a negative cash flow in 2021 and in the last quarter which is common amongst growth stocks, at the beginning the company spends more money on growth than it receives from sales. They acquired S397 and a bunch of licenses but the new games are obviously not ready yet, they need time to develop them. Their development expenses doubled from 2021Q1 to 2022Q1 so they're working on something for sure.
Acquiring licenses for future game titles, developing the games and the marketing cost a lot of money. And as their statement says they either have to borrow more money or somehow pump up the stock price and reduce expenses (workforce, etc) to stay alive this year because their cash flow was -$22 million in 2021 and another -$5.6 million in 2022Q1, they're bleeding money. But the 2021 result consist purchasing S397.
According to finance yahoo in 2021 they spent (lost) ~21 million on operating expenses (workforce) and ~15 million on investment expenses, my guess is that this was purchasing S397 and some licenses (?).
According to finance yahoo their current assets/current liabilities ratio is over 2 which is very good. Their current assets are growing year by year which is also very good. Their net cash is positive ($18 million), good to see. Their debt was very low at the end of the year... who knows for how long.

So why is the stock price so low?

One big red flag is that their stock based compensation was $9.7 million in 2021. When a company is losing $33 million a year they should NOT pay $9.7 million in compensation to it's employees. That seems shady business.
Taking a bit further they issued $63 million worth of stock in 2021. What this means is that they are basically running on peoples (investors) money without them generating any money.
The company didn't make any money yet and it's cash flow is very negative. And they missed all the analyst EPS targets so far which means they were selling less worth of product than the market anticipated (which was below 0 to begin with).

If I were an investor I would not touch this stock until at least one positive quarter. But even then...
At first glance Motorsport Games seems like a growth stock people like to buy speculatively. If the games they're developing will be good and promoting rF2 will be a success then the stock will rise (but first they need to survive). If the new games will function like Nascar21: Ignition then game over very soon.
IMO.

ps: since they're probably running on debt that would explain why they don't want to give discounts on the DLCs this summer sale.
 
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shiet said:
I used to trade stocks and Forex, I have some understanding about these kind of things but I'm not an expert.
So MSG had a negative cash flow in 2021 and in the last quarter which is common amongst growth stocks, at the beginning the company spends more money on growth than it receives from sales. They acquired S397 and a bunch of licenses but the new games are obviously not ready yet, they need time to develop them. Their development expenses doubled from 2021Q1 to 2022Q1 so they're doing something for sure.
Acquiring licenses for future game titles, developing the games and the marketing cost a lot of money. And as their statement says they either have to borrow more money or somehow pump up the stock price and reduce expenses (workforce, etc) to stay alive this year because their cash flow was -$22 million in 2021 and another -$5.6 million in 2022Q1, they're bleeding money. But the 2021 result consist purchasing S397.
According to finance yahoo in 2021 they spent (lost) ~21 million on operating expenses (workforce) and ~15 million on investment expenses, my guess is that this was purchasing S397 and some licenses (?).
According to finance yahoo their current assets/current liabilities ratio is over 2 which is very good. Their current assets are growing year by year which is also very good. Their net cash is positive ($18 million), good to see. Their debt was very low at the end of the year... who knows for how long.

So why is the stock price so low?

One big red flag is that their stock based compensation was $9.7 million in 2021. When a company is losing $33 million a year they should NOT pay $9.7 million in compensation to it's employees. That seems shady business.
Taking a bit further they issued $63 million worth of stock in 2021. What this means is that they are basically running on peoples (investors) money without them generating any money.
The company didn't make any money yet and it's cash flow is very negative. And they missed all the analyst EPS targets so far which means they were selling less worth of product than the market anticipated (which was below 0 to begin with).

If I were an investor I would not touch this stock until at least one positive quarter. But even then...
At first glance Motorsport Games seems like a growth stock people like to buy speculatively. If the games they're developing will be good and promoting rF2 will be a success then the stock will rise (but first they need to survive). If the new games will function like Nascar21: Ignition then game over very soon.
IMO.

ps: since they're probably running on debt that would explain why they don't want to give discounts on the DLCs this summer sale.
Click to expand...
The problem with not giving any discounts is that they basicly sell nothing compared to other publishers wich weakens their market share even more. Anyone who has understood the principle of economies of scale will know that you can decrease development costs tremendously if you sell alot of cheap DLCs. AC is a very good example on how you sell cheap DLCs with transparent prices to alot of people. On the other hand we have a summer sale for rF2 wich sells the base game itself but nothing else. How on earth are you going to sell a game where the content is ranging from fantastic (Class 1 DTM, Alpine Cup and the updated tracks for example) to outdated lowpoly stuff from 2009 or 2010 (Nissan GT1, 370z, historic tracks ... the list is still long) if you can have the AC Ultimate edition for the same price with all the laser scanned and lisenced goodies and access to alot of high quality mods? If those things would have been handled better in the past and the sales used to their full potential, costs wouldn't have been as high. I constantly have to shake my head with each sale that ISI and S397 are setting up and the CS will never work if they don't change their approach. With all the nice updates they have brought since the start of the year they manage to bring down the momentum with stuff like this. You just have to ask, why?
 
hitm4k3r said:
The problem with not giving any discounts is that they basicly sell nothing compared to other publishers wich weakens their market share even more. Anyone who has understood the principle of economies of scale will know that you can decrease development costs tremendously if you sell alot of cheap DLCs. AC is a very good example on how you sell cheap DLCs with transparent prices to alot of people. On the other hand we have a summer sale for rF2 wich sells the base game itself but nothing else. How on earth are you going to sell a game where the content is ranging from fantastic (Class 1 DTM, Alpine Cup and the updated tracks for example) to outdated lowpoly stuff from 2009 or 2010 (Nissan GT1, 370z, historic tracks ... the list is still long) if you can have the AC Ultimate edition for the same price with all the laser scanned and lisenced goodies and access to alot of high quality mods? If those things would have been handled better in the past and the sales used to their full potential, costs wouldn't have been as high. I constantly have to shake my head with each sale that ISI and S397 are setting up and the CS will never work if they don't change their approach. With all the nice updates they have brought since the start of the year they manage to bring down the momentum with stuff like this. You just have to ask, why?
Click to expand...

Agreed. Plus, much of the paid content has been abandoned. How many times did we hear the GT3s were being updated, many tracks looking strange since the last graphics update, and just crickets. I will be very hesitant to be spending more in Q2.
 
hitm4k3r said:
The problem...
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I can agree with you so I hope you didn't take my comment like I'm supporting the decision S397 made with the DLCs.
I just "analyzed" the fundamentals of the parent company as good as I can remember these things. :D

Other than the bad fundamentals of the company I have a feeling that MSG treats rFactor 2 as a "real" real simulator and not like a video game. So they think rF2 fundamentally worth more than other sims (ACC and AMS2) and that's the reason they really-really don't want to or don't care to grow the player base and give away stuff for "cheap". But then again they presumably don't want to go broke either so who knows what's in their mind.
 
Selling "cheap" Is what keeps a lot of companies alive, and not now, It´s basically a strategy to keep your daily expenses In check since the beginning of commerce and trade. Not that I am a expert or anything alike, but If you want to go the elitist route, which forgive me rF2 can not at It´s current state of Issues, you would then certainly need a big flow of backup funds to maintain afloat. And I say this because of @shiet statement that MSG just might think that, or make rF2 seem like a "real" sim. Which I also think that they just might be thinking that.

They don´t have to put the whole catalog on sale, but putting some of the bundles on sale would be fair enough to attract new players. At present, and unfortunately this could only get worst, there´s a freaking crisis going on! Your everyday Joe Is having trouble getting to the end of the month, so he cuts expenses and doesn´t go out as much either. His only relief Is staying home and have some fun with his distractions/hobby's, like let´s say sim racing. He will most likely Invest his little spare money left on his favorite sim, or maybe even on a new sim! But If you don´t put things easy for that average Joe, he´s going to Invest elsewhere. It´s pretty logical and even seems child´s thinking, I mean really everyone Is going on sale because SHTF can happen Immanent as things are going.

So no, I don´t understand this posture with MSG either. There was a race sale a couple of months ago on Steam and aside from the base game, everything was at the same price, now we have the biggest Steam sale of the year, and same thing. Again, If you want to at least promote the CS, put at least a couple of bundles on sale. Formula Pro, Endurance and even the E-Formula since It´s not to popular with the community. Even If It´s just 20%, but at least show your good will and just maybe the new comers will look the other way when they read the negatives. Otherwise your just adding more obstacles to the overall exposure of a great sim that seems to have a unclear focus as to what they want to achieve with there end user.
 
turtleCZ said:
I don't think sale is important strategy. Sure, it works a bit but they have packages as a sale. It could be good model.

Don't forget main game is for few bucks and with free mods you have much better game than anything else.
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The Summer Showdown Pack (sale) was not there yesterday when the Steam summer sale started. So they must have uploaded it sometime today, and It´s the only pack on sale.

Personally I have no Issues at all as I really like rF2. It´s just my concern with attracting more player base which leads to more Income and a bigger community overall.

I will remain Semper Fi to rF2 no worries about that.
 
shiet said:
I can agree with you so I hope you didn't take my comment like I'm supporting the decision S397 made with the DLCs.
I just "analyzed" the fundamentals of the parent company as good as I can remember these things. :D

Other than the bad fundamentals of the company I have a feeling that MSG treats rFactor 2 as a "real" real simulator and not like a video game. So they think rF2 fundamentally worth more than other sims (ACC and AMS2) and that's the reason they really-really don't want to or don't care to grow the player base and give away stuff for "cheap". But then again they presumably don't want to go broke either so who knows what's in their mind.
Click to expand...
It they (MSG or rather someone from S397) think it’s elitist simulation then why they discount base game 80% off? Perhaps they think DLC is such high quality that it shouldn’t be discounted? That’s not necessary the case as many DLC have issues. following this logic iRacing must think they are the ultimate simulation as they never discount content.
BTW I think the whole rf2 DLC in Steam is a little bit of a mess. For instance when buying packs it would be nice if you could discount the content you already own. I bought some content twice when buying a pack.
 
avenger82 said:
It they (MSG or rather someone from S397) think it’s elitist simulation then why they discount base game 80% off?
Click to expand...
I think the logic is if someone buys the base game eventually will buy DLCs too. At least that's what they hope for. I've read and seen a lot of reviews about rF2 and very few mentions the workshop.
In reality most of them can't recommend the game because it's expensive if you account for the DLCs and of course in their mind rF2 is nothing without DLCs. Also on forums people sometimes have no idea how to install a mod from the workshop. Or if there is a workshop at all.

In regards to iRacing I think you're wrong. Their prices are the same since 2013 at least when I first joined (I don't know what was before 2013). Everything costed exactly the same 9 years ago as of now. So if you account for inflation their prices are cheaper and cheaper year by year. And they offer discounts for renewals (I received a mail from them a few days ago), they offer bulk purchase discounts (10-20%) and they offer an additional discount if you already own 40+ paid content (I think this is also 20%).

But imo comparing iR to any other sim is a mistake. They offer a multiplayer racing experience which is still nowhere else to be found so they're basically in a monopolistic position in their field because they're the only one offering this kind of service. People go there for the multiplayer racing experience and not really for the simulation value of the game. I mean if you look up the opinions about iRacing physics, sound, graphics, FFB, basically everybody knows they suck in these areas vs this or that sim. Except for the online racing system.
But I don't want to go in this direction.
 
turtleCZ said:
It's there since start but price was broken. I meant every pack is discounted automatically. Single items are more expensive.

Base game for few buck is good enough, you get updated engine with so many stuff.
Click to expand...

The Steam summer sale went live yesterday at 1pm ET, I logged In 2min. later. There was nothing on sale except the base game.

Here´s a screen shot of the packs...
Screenshot-2022-06-24-231000.jpg


Where do you see any of these packs on sale?
 
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