Pennexx Foods Inc (PNNX)

[stervc]

PNNX Valuation/YSO obtaining 1 Million Users in Aug 2020...

I think with the coronavirus (COVID-19) pandemic, PNNX had to take a step back to reevaluate how they would be moving forward. The Restaurant Industry took a huge hit and is now somewhat recovering with some restaurants not shutting down and many of them are now going to offering takeout services. PNNX/YSO looks to have more to offer to a variety of many other companies instead of restaurants, but their operations still could provide their YSO service with even more demand.

Important to note, there are roughly 17 million people that are unemployed. They are going to welcome what PNNX/YSO is offering as it is going to give them a chance to earn rewards by saving money and making cash. The more they us YSO, the more they will save and make.

Those 17 million unemployed and we all are still going to have to eat and the majority of people will at some point in time eat via restaurant takeout services. Because of this, I think restaurants are going to begin to see YSO as a huge marketing tool as it will prove to have the capacity to reach millions of customers.

Important to note, PNNX/YSO stated within the PR below that they believe that they can reach a million users by the end of August 2020:
https://www.otcmarkets.com/stock/PNNX/news/Pennexxs-Your-Social-Offers-is-Poised-to-Help-Businesses-Attract-New-Customers?id=258788

This is significant in my opinion because of how a valuation could be considered from comparing a similar company within the Fintech Industry called Ualá that's located in Argentina. Ualá has 1.3 Million customers and was given a value somewhere between $850,000,000 to over $1,000,000,000. What's key to note was that this huge billion dollar valuation was given to them by Tencent and SoftBank’s Latin America-focused Innovation Fund:
https://filmandtv.com/se-EN/title/argentina-s-uala-valued-near-1-billion-in-new-financing-round-1911270134

https://www.facebook.com/579840665364797/posts/japanese-conglomerate-softbank-group-corp-and-chinese-giant-tencent-are-lead-inv/3024602464221926/

Tencent is a 312.7 billion CNY company that equates to being a $45,283,400,340 company is US dollars:
https://www.google.com/search?q=Tencent&rlz=1C1CHBD_enUS840US840&oq=Tencent&aqs=chrome..69i57j69i60l2&sourceid=chrome&ie=UTF-8

https://www.google.com/search?q=312.7+billion+CNY&rlz=1C1CHBD_enUS840US840&oq=312.7%C2%A0billion+CNY&aqs=chrome..69i57&sourceid=chrome&ie=UTF-8

SoftBank is a $112.4 Billion company in US dollars:
https://www.forbes.com/companies/softbank/#71dd6b566cf8

So… if anyone have an issue with how the metrics were used and derived for them to give Ualá a value of roughly $1 Billion for having 1.3 million customers, please take that up with them.

Ualá is a personal financial management mobile app developed in Argentina linked to a Mastercard prepaid card that allows users to conduct financial transactions, such as, transferring money and making payments and purchases. This is basically one of the things that PNNX will be offering to their users through its wholly owned subsidiary, Your Social Offers (YSO), a prepaid Master Card that will also allow you to convert dollars into bitcoins or bitcoins into dollars through real time redemption in fiat currency (US Dollars).

For now, I’m going to consider the valuation for Ualá to have merit. Here are some valuation considerations for PNNX from such logic…

$1,000,000,000 ÷ 1,300,000 Users = $769.23 Per Users

This could potentially mean for PNNX from only 1,000,000 users…

1,000,000 Users x $769.23 Per User = $769,230,000 in Value

What’s not clear, based on when those valuation metrics were given, is if they were referring to that $1 Billion amount from either a Market Cap perspective or a Revenues Model perspective. I’ll calculate valuations from both perspectives below…

From a Market Cap Perspective

$769,230,000 ÷ 46,957,322 Outstanding Shares (OS) = 16.38 Times as Multiple

This means that from the current price of .1377 per share for PNNX, the current value for PNNX when they obtain 1,000,000 users is going to be roughly $2.26 per share based on the Market Cap Analysis as derived as such from below…

16.38 Multiple x .1377 PNNX Share Price = $2.26 per share


From a Revenues Model Perspective

Before reading this model, I’m going to speculate regarding some variables so if anyone feels different regarding any variable, please use the Substitution Property to substitute out any variable within the formula to make the result as conservative or aggressive as you desire.

Since the PNNX operations is basically automated, I believe there is very low factory overhead with very minimal Expenses of which could easily see an 80% Net Profit Margin to derive an Earnings Per Share (EPS). However, instead, I’m going to presume an overly conservative 10% Net Profit Margin as a worst case scenario which might be too extreme for some.

$769,230,000 x .10 Net Profit Margin = $?76,923,000 Net Income ???????

$?76,923,000 ? Net Income ÷ 46,957,322 Outstanding Shares (OS) = $1.64 EPS ???????

Now we must further multiply the EPS by a PE (Price to Earnings) Ratio considering that PNNX would exist to trade within either the Software (Internet) Industry or the Software (System & Application) Industry.

The Software (Internet) Industry has 90.14 for its PE Ratio and 66.75 for those that would rather use its Trailing PE Ratio as can be confirmed from the link below out of taking such data from the Top 30 Companies within the Software (Internet) Industry:
http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/pedata.html

The Software (System & Application) Industry has 144.40 for its PE Ratio and 110.90 for those that would rather use its Trailing PE Ratio as can be confirmed from the link below out of taking such data from the Top 363 Companies within the Software (System & Application) Industry:
http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/pedata.html

I think it is important to understand the logic behind the Price to Earnings (PE) Ratio. The links below should help to better understand the PE Ratio logic as being the ”growth rate” to help assess the fundamental valuation of a stock:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57154170
http://www.investopedia.com/terms/p/price-earningsratio.asp

When analysts talk about the PE Ratio, they commonly refer to the Trailing PE Ratio which is why such is what I will use for the purpose of deriving this valuation and plus it’s smaller and more conservative compared to the current PE Ratios:
https://www.investopedia.com/ask/answers/050115/what-difference-between-forward-pe-and-trailing-pe.asp

So, to continue…

I could logically use any of the PE Ratios above ranging from 66.75 to 110.90 as you can see from above. However, I will take yet another step of being conservative and use 20 as the PE Ratio for the purpose of deriving this potential PNNX valuation which is far lower.

$1.64 EPS x 20 Conservative PE Ratio = $32.80 per share

Let’s say I’m off in one of my variables above by a factor of 10. So for an example, instead of PNNX getting 1,000,000 users, let's presume that they only get 100,000 users. Then you must use the Substitution Property to recalculate the formulas above of which from quick math, slide those decimals to the left one placement representing one tenth (1/10) of the share price valuation above which would equate to $3.28 per share.

In my opinion, being off by a factor of 10 is being extremely conservative in my opinion. I say this because after further reviewing their slideshows, updated websites, and other comparisons below, I think they are well on their way to achieving these share price valuations:

https://www.yoursocialoffers.com/


PNNX/YSO 11 Projected Revenue Channels
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=154423659

Significant PNNX/YSO Operational Presentation
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=154423598

PNNX News**Significant Deal with LEVERAGE
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=154300588

PNNX/YSO vs PayPal vs Zelle vs Other P2P Companies
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=154008380

PNNX vs PayPal/Honey
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=153833924

PNNX vs Plaid
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=153810675

PNNX vs MELI
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=153809956

https://www.youtube.com/watch?v=zBq-pHdelT8

v/r
Sterling