Good morning, Sgreg, and thanks for having re-read my post, as you mentioned. Let me copy into this post part of my post #4128 which is an excerpt of Paul Knopick's search for investor capital for this company:
"Vaping/e-cigarettes is a new, multi-billion dollar sector, growing rapidly. We have a client in the sector that is, we are confident, the most creative company and also sound financially and in its management team. They anticipate $6 million in sales this year and $10 million or more next year. They are looking for an equity investment (not convertible debt) of between $1 and $5 million. If interested, please contact..."
I just believed at that moment that if you're looking for capital in excess of your then-current market value, you've put yourself into play to be acquired - and I believed at that moment that other companies in the industry would be lining up at the door to pick them up, given the quality and constant improvement/expansion of the product line.
Meanwhile, that same letter from Paul referenced sales for the current year of $6 million and for next year of $10 million. The math then is present as regards $2.4 million in sales for the current quarter to get the current year up to $6 million, then annualizing the $2.4 million (without even growing it) to get up to nearly $10 million for the next year.
And that indeed is when I turned bullish on the stock, despite my continuing skepticism that, somewhat out of the clear blue sky, sales will double from one quarter to the next. I would have believed that such a positive development would have been announced contemporaneously with publishing the Q3 financial statements so as to soften the blow of what really was poor financial performance in that quarter.
What all that leaves to answer is two questions - Marchio's question regarding what's the stock worth if the company is doing $10 million in sales for the next fiscal year and my own question as to what the stock is worth if it's an acquisition target (who'd put $5 million into the company and not want all of the company in return for that?). ...and I'm going to "wimp out" of answering those two questions for the moment by writing simply that the number I'd come up with would exceed the closing price yesterday of the stock.
Have a good day!
