Savvy Trades and Investments

[wadegarret]

KIK & others- CLNE, this UPS deal is huge

In the PR, it said UPS will be buying on average 24M gallons renewable liquid NG/per through 2026. So in dollars, that would be around $60M/year in revenues. If they did $77M last qtr, that would add around 20% in revenues/qtr & per year. Now next year, analysts think they'll post $392M revenues, and that was before this UPS news, that will add $60M/year. So I start with the potential of $450M in 2020, not including any other unexpected huge similar contracts.

Starting with $450M, and with a 38.5% margin as they had in 2018, and assuming 20% more in S,G, & A, the same interest expense, and the same "other expenses" as in 2018, they would make around $50M in Income before taxes. Then they have around 200M shares, so around $.25 in EPS. LNG is the closest I can see to them, and they get a 30 PE on 2019, and 18 PE on 2020 eps estimates. If we give CLNE a PE of 15 going forward, I could see the stock going to $4 https://finance.yahoo.com/m/de55c29d-376d-3eeb-9535-756712ffa05d/ups-commits-to-largest.html