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ANDI .192 Fundamental Valuation to Consider…

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stervc Member Level  Friday, 12/22/17 03:07:53 AM
Re: stervc post# 74523
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ANDI .192 Fundamental Valuation to Consider…

Below is a post where I had indicated that the CEO of ANDI believes that the company will generate over $100 Million in Revenues/Sales:

Within the ANDI update below, it was indicated that the Outstanding Shares (OS) for ANDI is 2.6 billion shares:

Let’s presume that ANDI generates the $100,000,000 Revenues that they have projected as indicated within the link above and consider their OS to be 2.6 billion shares. Let’s presume a 25% Net Profit Margin. Now we can consider the valuation thoughts below to derive an Earnings Per Share (EPS) and then a share price valuation…

$100,000,000 ANDI Revenues x .25 Net Profit Margin = $25,000,000 Annual Net Income

Net Income ÷ Outstanding Shares (OS) = EPS

$25,000,000 Annually ÷ 2,600,000,000 Shares ANDI OS = .0096 EPS

Now we must multiply the EPS by a Price to Earnings (P/E) Ratio to get a Fundamental Valuation to consider for where ANDI could exist to trade compared to the other stocks within its Industry or Sector. The links below should help to better understand the P/E Ratio logic as being the growth rate to help assess the fundamental valuation of a stock:

ANDI is projected to generate $100,000,000 in Revenues while existing to trade within the Telecom Equipment Industry of which has a P/E Ratio of 50.23 within the link below:

However, I will use 20 as a more conservative PE Ratio.

Please understand, if one chooses to consider a lower number or a higher number, simply use the Substitution Property to replace such variable or any other variable to what you might choose to believe is a more fair variable to consider. Now consider below…

EPS x P/E Ratio = ANDI Share Price Valuation

ANDI EPS = .0096
Telecom Equipment Industry Conservative P/E Ratio = 20

.0096 EPS x 20 P/E Ratio = $.192 ANDI Share Price Fundamental Valuation


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