OK, so they are not really buying at $.10 per share, are they? This is what I was concerned about.
They are investing 7.5 million and will get 51% of the company for that price which means they are buying at around today's prices!
Huge dilution. Necessary, but it hurts. The $.10 price isn't so impressive anymore when you figure that part into it.
But it is good to know the current share count finally and yes, now you can begin to do some potential valuations.
One problem is that we still don't know much about the cost of our revenue. What percentage of the $28.8 million CAMWATER contract will be profit for the company?
Assuming a 1 billion share count, to get a penny profit, you would need 10 million dollars of profit. I would think that might be close to doable through that contract alone, but no one really knows at this point.
To be safe, assume $.005 profit per share. Still, that is impressive for a company that trades for 3 times that figure. There are other sources of income as well, but how much of it will be profit is still unknown.
I doubt all of that CAMWATER profit would be realized in this business year though so, assuming a 1 billion share count, perhaps we are at a fairly reasonable valuation here.
Of course the potential for future gains is encouraging, but considering actual profits for this year, - just guessing - but it seems we are at a pretty fair valuation.
I'm not an expert. I am long with a small number of shares. Someone convince me otherwise?
