Universal Energy Corp (UVSE)

[eddy2]

Lets look at how he got those shares. The debt not liability that has to be paid back due to banks are not so foolish as we who play the game and buy equity.


First and for most share holders debt has a par value no par value no debt that is share holders debt that is in other words it is a liability and is required to be paid back to the bank what is borrowed.


The debt is what the market has established the debt to be regardless what the equity maybe because that money will be used to underwrite additional shares.


We know that assets must equal debt in all forms so if the asset is a $1 then must be the debt as well this brings us too how assets are valued after depreciation regardless if the asset made a profit of a $1 when new or after it is thirty years old but what changes is the maintenance up keep to keep that asset producing those same profits and this capital required to do just that can be obtained from the public,bank, by the issuing of new equity or buying back existing shares on the cheap and reissuing those or borrowing capital from private sources being public, insiders or institutions or going into a BK should the business not be sound enough to raise the capital and as you know assets in business are only worth what they may produce in potential revenue into the future unless of course the asset is a symbol of wealth, pleasure ect. that someone is willing to pay above what is its true intrinsic value is often set by the market place.


Now with that this takes me to another space were what if an asset has the potential and does produce great returns for its investors but again the market does not want to realize that potential what happens then.


Well what happens is the debt gets bought for what the debt is marked at by the public at the price stated giving the shareholders the first right to there debt so decided by the individuals they elected to do so.

So the shareholders are now gone private giving there shares a par value of what ever figure holding very little debt except the liability debt that has to be paid by the selling of equity gained in what in hopes that some day someone may want those assets for what they generate in profits.


How does one value profits well taking in the risk that the banks put on there debt that can be derived from looking at there own company debt or others and taking that profit and working backwards to come out with an intrinsic value for the business. You may also use ratios for a like business sold to get at the intrinsic value as well.


So what was here well do your own DD it is not rocket science now that every one knows how to value a enterprise by using the numbers given and future reserves not realized in the numbers until a product is ready to go too market that will require future capital as well to get it there that has to be brought into your consideration when valuing a enterprise true value.



I will say this that if the value was here the pros would be all over it and will have given a much higher value then what the enterprise has been given to date but go ahead and do the math you all have the skills to do just that and look for that diamond in the rough if you may and good luck to you.