Praxsyn Corp (PXYN)

[OhManIDied]

Estimate of the future Earnings of PXYN:

The aim of this estimate is to determine the profit potential of Praxsyn in the medium-term future. This calculation is important to consider since the share price is strongly determined by future speculation.

Based on the expected duration of time required to collect accounts receivables (ARs) - previously discovered and restated in the quoted post below - there is reason to believe that the newly conceived in-house collections department, "NexGen", will be able to collect upwards of 70% of Praxsyn's ARs relatively soon. The Q2 in-house collections are believed to be in the ballpark of 25-37% of ARs, as determined in this post and further explored in the subsequent string of replies: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=107913691

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=107912167

[Praxsyn].. collects the first 1/3 of AR's in the first 30 days, the second 1/3 in the next 90 days and the last 1/3d of AR's can be more difficult and take up to a year to collect.

The estimate below is computed as a percentage of gross revenue, using the relative impact of expenses/costs (and other information) seen clearly in the 10-Q from the second quarter of this year:

Gross revenue: 100%
Net revenues(47% of gross): 47%
- 1.974% Cost of goods sold (4.2% of net)
Gross profit: 45%
- 12.25% sales/marketing fees (17.5% fee on 70% non-factored)
- 3.9% sales/marketing fees (13% fee on 30% factored @ 20% or above 24.5%)
- 3.5% in-house collection costs (5% of revenues from 70% non-factored)
- 3.0% general and administrative (conservatively high % of gross)
Net profit: 22.35%
- 7.8% "Interest Expense" (from factoring; 26% unrealized net revs on the 30% of total ARs factored)
Net income from operations (before taxes): 14.55%
- 0% Income tax (there is a sizable deferred tax loss remaining from old shell)
Earnings: 14.55% of gross revenue

I believe that roughly 15% of the gross revenues will be recorded on what could easily be $300M of sales for Praxsyn in 2015. That would equate to Earnings of $45M for the fiscal year of 2015. It's probable that this run-rate (of 70% ARs collected in-house) can reasonably be accomplished in the near term. Feel free to verify and double-check the information contained in this post, challenge any aspect of this post, and ultimately speculate on the fair share value.

PXYN