InMed Pharmaceuticals Inc (INM)

[lesgetrich]

LOL You just saw the pps almost double in the last few week. Apparently not much affect.

In all seriousness, it will depend on the revenue and earnings potential that investors see in the company going forward. At this point it's all speculation. Once the company develops a stable revenue stream, the pps will usually settle into a multiple (PE or price/earnings ratio) of the earnings per share (EPS = earnings per year/average OS). At this point we can only guess what the revenues and earnings will be in a couple of years but the potential is there for hundreds of millions in revenues.

For example, just doing some very rough calculations at 15% profit margin with the current OS and a PE of 40 x EPS, I estimate every $22 million in revenue would conservatively be worth $1 in share price. Of course I could be off on the profit margin and investors might be willing to give a higher PE to a growth company like InMed. In any event, as the company gets closer to producing revenue, people will be bidding up the pps.