Next Green Wave (fka NXGWF)

[Sam_1992]

The answer is yes and no because equity market is forward looking.

Based on my model - the current price is fair value (.65 - .8 CAD). Now to get to this value, I can't just use the financial statement from Q3 2019. I have to factor in those nice growth and Mike Jenning has been reporting over the last few months. And with those earnings, I was comfortable enough to remove the $16 million of "Retain Earning" on the Balance Sheet because I know NGW is cash flow positive so those number will be gone by end of this year. Only then that I get to the .65-.80 fair value.

Now you may wonder - how does Harpo get to his valuation of $1+ or Hunderdog get to his valuation of $2.5+. Well the simple answer is that they use a simple comparable company analysis approach. They simply took the annual revenue of $20M (by the way - this number is also a forecast based on 4.5 million-ish a quarter) and multiple it by the Price-to-Sale ratio of whatever canabis company they feel like it. Now this approach is kind of dumb when it is by itself because you are not really valuing a company based on its balance sheet. You just use the annual revenue and multiply it by whatever other companies are trading at. The number would look totally different when the market sentiment reverse and the P/S ration declines lol....like right now....go look at the level that all the big names are trading at.

And also guys - stop thinking of the company value as Price Per Share. Use the market capitalization - this way you know the relativity of your company to others. Like right now - I think NGW maximum fair value is at $200 - $300million. Any more than that and you would need to account for the 1.5 time increase from Facility C and the future 100,000 lb per year from Facility D.

Last - just because a company is at capacity doesn't meet that the balance sheet can't get any better. They can reduce operational expense (which I don't think they can) or increase margin from sale (which I think they can if the Cookies deal allows NGW to sell at higher price-point.

That is my two-cents. Bottom line - don't just listen to people on the boards. You don't even know who is on the other side. Even all these analysis I just mentioned doesn't even include the market demand. I just assume that they will sell out (see - again that's an assumption.)

Buy more when fund become available....joke I am broke.