Good for you kids. For fun you should look at your old posts. And the posts of the others from back when it's a hoot.
Excalibur1 Saturday, 04/06/13 05:10:53 PM
Re: None
Post # of 78306
BASED ON BAYESIAN ANALYSIS:
AAPT Probability of success: 0.7 (70% likelihood AAPT revenues continue to increase)
AAPT Probability of failure: 0.3 (30% likelihood AAPT goes bankrupt)
AAPT PROS:
Past the development stage.
Management is experienced, persistent and innovative.
Has a unique product in a dull industry and has a niche in dog food bars.
Nutrabars are a game changer in the dog food industry.
Product is suitable for multiple retail channels.
Product is in stores and seems to be selling well per my observations.
Nutrabars are products that are purchased repeatedly, rather than one time.
Institutions don’t own shares, and the analysts don’t follow the company.
ISSUES:
Moldy bars with initial shipment – Problem with glue solved (to be seen)
Debt – Increasing revenues will enable AAPT to pay down debt
Grushkin – Confident AAPT will prevail in lawsuit.
Dilution – Necessary for AAPT growth. Company can buy back and retire shares as revenues increase.
MY TOTAL COST BASIS: $12,526.00
PROJECTED PPS RANGE WITHIN 1 YEAR:
$0.08 (pre-Grushkin PPS) to $0.25 (expected value)
PROJECTED INVESTMENT VALUE RANGE WITHIN 1 YEAR: (after Grushkin case settled and June 30, 2013 financials released):
$49,840.00 to $155,750.00
PROJECTED PROFIT RANGE WITHIN 1 YEAR:
$49,840.00 - $12,526.00 to $155,750.00 - $12,526.00 = $37,314.00 to $143,224.00
ADJUSTED PROJECTED PROFIT RANGE WITHIN 1 YEAR:
$37,314.00 x 0.7 to $143,224.00 x 0.7 = $26,119.80 to $100,256.80
ADJUSTED PROJECTED RATE OF RETURN WITHIN 1 YEAR:
$26,119.80 ÷ $12,526.00 to $100,256.80 ÷ $12,526.00 = 209% to 800%
ADJUSTED PROJECTED LOSS:
$12,526.00 x 0.3 = $3,757.80
RISK-ADJUSTED PROJECTED PROFIT WITHIN 1 YEAR:
$26,119.80 - $3,757.80 to $100,256.80 - $3,757.80 = $22,362.00 to $96,499.00
RISK-ADJUSTED PROJECTED RATE OF RETURN WITHIN 1 YEAR:
$22,362.00 ÷ $12,526.00 to $96,499.00 ÷ $12,526.00 = 179% to 770%
Based on prior investment experience, I expect these shares to trade on NASDAQ or NYSE within 5 years, and then institutional investors to propel the PPS into the stratosphere.
I perform the above “paper napkin” analysis for all potential investments, in addition to further in-depth analysis. I do not take a position in speculative shares unless I know the risk-adjusted projected profit and rate of return. The above risk analysis has been a useful tool for me over the years, particularly for identifying potentially profitable speculative long investments in small consumer product companies and for taking arbitrage positions in general. Investing and speculation is all about risk management.
The above analysis summarizes why I’m long AAPT and will continue to accumulate shares. Good luck to all.
