22nd Century Group Inc (XXII)

[macnqueso]

True dat... and ignoring the current valuations of future potential is not the same thing as doing dd either... the current value of future potential is subjective to be certain... and reasonable minds might very well disagree... yet the essential elements of valuing future potential in the present is pretty straightforward... its a process of balancing the probability of reward against the probability of risk over time, with time exacting an opportunity cost... how these elements are weighted will depend on one's assessment of each, which is what makes the process subjective... in what sense do i find xxii to be undervalued in its current pps?... i am glad you asked...

xxii has 4 opportunities with future valuations which could reach a billion dollars each or which could become worthless... the question becomes what would someone pay today for the opportunity to participate in substantial gains a few years from now - knowing that in fact i could lose it all?

So I start with the back end... what are the chances i will lose my entire investment? The answer to that... imo... is very small... all four billion dollar ops would have to fail almost completely for me to lose my invested dollars... if any of the four only manage to produce about one tenth of their billion dollar potential, then the market cap of today is sustained in the future... anything beyond that and i am going to be rewarded with investment gains... the likelihood that all four areas of business development fail completely is near zero imo... making this a very low risk entry point...

the potential for gain is immense... each billion dollar market cap is worth a little less than $20 per share... if one, some or all the billion dollar ops reach potential the pps would grow to something between $20 and $80... so what would i pay for this risk/reward valuation... yesterday i paid 1.699 and found that to be a terrific bargain... somebody else sold to me at this price, so they obviously did not find it to be a bargan... to me it is very cheap...