Having scrubbed down the numbers I posted that had originally been put in the Ibox, I feel I have a better sense of the business' paradigm and can clarify the projections for 2007, or at least make some good guesses where I don't really know the details. Here goes:
Basically, the company earns 3% of whatever deals they make. Thus, if they get a $200 million receivable deal, on average 3% ($6 million in this case) goes to revenues.
I feel comfortable with $3 million for 2007 as projected revenues, and believe it could be higher. Nonetheless, I'll use that for a revenue estimate.
Now what I don't know in two parts:
1.) SG&A. The business has very few employees and very low overhead, but I don't know details here, so I will project them at 20% of revenues, which I believe to be very conservative.
2.) Taxes. I'm using a 35% Federal rate here and assuming there are no offsetting NOL carryforwards, which I don't know, and assuming no state taxes, which may be errant. Nonetheless, I'll estimate taxes at 35% of pre-tax income.
This would yield:
Revenue - $3,000,000
SG&A - $600,000
Taxes - $840,000
Net inc.- $1,560,000
I believe outstanding shares to be roughly 87 million, so EPS then would be $1,560,000/87,000,000, or $.0179, which at a reasonable 20 P/E for a growing company would yield a share price of $.36.
That's my best estimate, albeit somewhat full of uncertainties. Be those as they may, I think it certainly indicates that we're underpriced at $.048.
AI
