Telkonet Inc (TKOI)

[littlbyrdy]

Telkonet Price Target....playing with numbers. Invite discussion.

Would like to open up discussion on a price target for Telkonet. I would like to show how seriously I believe Telkonet is undervalued and am interested in other opinions too. Also made this post on Yahoo.

What is the most applicable PE to use for Telkonet? The NYU Sterns list of PE ratios by sectors shows an average forward PE of 29.2 for Green and Renewable Energy as of Jan 2015 - this sector isn't a perfect fit for Telkonet but it's the best I could find, and it strikes me as a VERY conservative number for Telkonet. But I will start this calculation with what I consider conservative numbers (but will round up the PE to 30 to make it easy). TKOI is on track to do at least $2M annually and they list 126.63M outstanding shares. I believe they can do MUCH more revenue as they continue to expand their business both domestically and internationally. Pick what you think is a reasonable PE and net revenue below:

PE 30:
$2M profit = 1.6 cents per share x PE of 30 = $0.48 share price
$3M profit = 2.4 cents per share x PE of 30 = $0.72 share price
$4M profit = 3.2 cents per share x PE of 30 = $0.96 share price
$5M profit = 4.0 cents per share x PE of 30 = $1.20 share price

PE 40:
$2M profit = $0.64 share price
$3M profit = $0.96 share price
$4M profit = $1.28 share price
$5M profit = $1.60 share price

PE 50:
$2M profit = $0.80 share price
$3M profit = $1.20 share price
$4M profit = $1.60 share price
$5M profit = $2.00 share price (hello 10 bagger)

I just don't see a downside here, or am I missing something? If so, please enlighten me.