Verus International Inc (VRUS)

[Crozz]

Wood please explain your Valuation method. I respect that you’ve been around a long time, but I highly disagree with the plausibility that Verus is fairly valued below a $3M Mkt Cap (though it will always fluctuate)

None of what I’m about to explain really matters in the OTC and Valuation really only matters in the case of Acquisition or Sale of the company (pls keep that in mind) - none of this is investment advice

If you take away the growth status (which I disagree with) and value the business strictly as a Food Wholesale Distributor - even on the low end of Simple Valuation, VRUS is undervalued.

Simple Valuation = a multiplier of Gross Revs or Net Sales (or EBITDA or SDE)

(non-growth) Wholesale Distributor Multipliers are as follows:
$21M Annual Gross Revenues
Low - 0.17x = $3.57M ($.2975 per share)
Avg - 0.46x = $9.66M ($.8050 per share)
High - 1.38x = $28.98M ($2.415 per share)

Growth Company Multipler is 3x-5x Gross Rev and can be as high as 12x in Food Distribution.
3x = $63M ($5.25 per share)
5x = $105M ($8.75 per share)
12x = $252M ($21 per share)

Current Mkt Cap is $3.02M

The (non-growth) calculations are a worst case scenario, based on the argument that Verus isn’t a growth company, which I don’t agree with either. Now I agree, that you could dig deep into the numbers and say Verus isn’t profitable, but no one is going to do that with a Small Business whose revenue lies solely on Food Distribution Contracts.. Simple Valuation is all that will be done if Verus were to be acquired, because a company would only be interested in buying the food contracts (Revenues) and would most likely eliminate the operations and associated costs.

I’m no big fan of Verus long term either, but even I see Verus as a Growth Company (albeit a resetting one). But to deliver $21M in a Pandemic Year where travel was restricted and shipping was disrupted, is impressive by my own admission...and no one is going to fault any company who has growth in a year plagued with Pandemic head winds.

There is little argument that would be supported claiming that Verus is Overvalued in its current state. This is what I have been saying since the RS, which created a whole new dynamic of being a volitile Low Float Penny Stock trading on the OTC with 12M O/S. I do this Valuation all the time to find value stocks, but it’s not usually relevant in OTC Penny’s as they tend to trade more on Mkt Sentiment and Emotion.

VRUS will pop and run north of some of these numbers, but it will always fluctuate.

Purchase value of Verus is prob in $2-$5 range which is all Valuation Calculation is good for on the OTC (IMO).

These are my opinions - My trade basis is supported by these numbers, but I’m here based on 12M O/S and knowing the history of this company’s massive runs from similar levels.

GLTA
-C