D-OH!
By: been_burned_before
13 Aug 2005, 09:59 PM EDT
Msg. 2159 of 21104
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Given the new O/S share count for GFCI . . .
A crude, yet enlightening, PPS valuation is revised.
Given all of the available information posted in the PR's, one can arrive at a crude valuation for a forward looking PPS. Just humor me, I know it is very, very crude, but I admit it is nevertheless very enlightening to consider the reasonable possibilities in GFCI's PPS looking forward.
GRIFCO Item (Count) $millions
Jet Motor (100) $48.00
RotorJet (~70) $ 3.20
PMC Screen $ 2.50
Pemex Mexico $ 2.50
Scuda Tool $ 2.00
Ko-Vac Unit $ 2.00
Silver Hawg $ 1.50
Misc. Tools $ 1.20
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Total Yearly Revenue $62.90 million
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Approx. Shares O/S 31.6 million
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Probable EPS $ 1.99
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EPS Multiple $PPS
1x $ 1.99
2x $ 3.98
3x $ 5.97
5x $ 9.95
10x $19.90
15x $29.85 (industry standard)
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My, my! The possibilities we can truly expect!
Please understand that I am very well aware that I have not accounted for any income taxes, administrative and general expenses, interest expense on debt, or any other expenses related to doing business. Also, understand that I have neither included any exponential growth that may certainly result from GFCI's dealings with Libya, China, Venezuela, Canada, or from any potential increase in the orders of Jet Motors and/or any other promising tool.
Been_Burned_Before
By: been_burned_before
29 Nov 2005, 08:09 PM EST
Msg. 4431 of 27293
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Can anyone say, "UNDERVALUED"??
May I remind everyone that the fair market valuations for both GFCI and its new spin-off, CTTI, are much higher than the paltry valuations the market is now giving it at these levels. To summarize:
For GFCI: $3.20 per share
For CTTI: $1.14 per share
This is all figured by leaning on revenue projections that were taken from various PR's. For 2005, revenues for GFCI were projected to be $24.5MM (excluding CTTI), while for CTTI, they were projected to be $20.0MM.
Granted, these fair market valuations are also figured by assuming a conservative 35% net profit margin, an industry standard 28x trailing P/E multiple, as well as 37.57MM and 85.72MM shares O/S for GFCI and CTTI, respectively, and a hefty, 50% discount for being a mere Pink.
Even assuming that the revenue projections were overstated by as much as 100% (highly unlikely), we still have:
For GFCI: $1.60 per share
For CTTI: $0.57 per share
Furthermore, even going so far as to assume that the share count for GFCI is obnoxiously higher -- let's assume it is really 70MM shares O/S -- as well as also assuming revenue projections were overstated by as much as 100%, we still have:
For GFCI: $0.86 per share
For CTTI: $0.57 per share
And this is a worst-case scenario! And I am so confident that things are no where near this bad. Given all of the available evidence, I tend to lean toward the following as the most likely valuations (now, I understand it is not to say that they MUST be valued this way, but only that they SHOULD be valued this way!):
For GFCI: $3.00 per share
For CTTI: $1.00 per share
By: been_burned_before
30 Mar 2006, 10:14 AM EST
Msg. 9262 of 27293
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OK, now that we know . . .
the official share count for GFCI -- namely, 39.68 million shares o/s -- we can now make a fairly educated guess about the fair market value for GFCI, given the last bit of some unofficial news regarding financials. Not too far back in mid-September, Mike King of Princeton research put the word out via e-mail that GFCI's earnings for fiscal year ending June 30, 2005, were $4.4 million.
Given a median TTM P/E multiple for the Oil & Gas Equipment & Service Sector of 24x, let's go ahead and lean on over to the conservative side and give GFCI half that -- 12x. So we now have a fair market value of:
$4.4 million / 39.68 million shares x 12 P/E = $1.33 pps
Now, it's extremely important to understand that most small but growing and profitable companies will typically command much larger P/E multiples relative to their peers -- it's a fact that is true for practically all sectors, as behemoth companies will usually bear the smaller P/E multiples.
For just one example, consider this sector: Boots & Coots, a relatively small service company, commands a P/E multiple of 50x, while Schlumberger, a much larger behemoth of a company, only commands a P/E multiple of 32x. Given these facts, let's once again make a fairly educated guess about GFCI's fair market value potential, considering its plan to list on the AMEX, like Boots & Coots -- let's see what GFCI could be worth with a TTM P/E multiple of 50x:
$4.4 million / 39.68 million shares x 50 P/E = $5.54 pps
Now, what if we play as fair as possible and give GFCI the median TTM P/E multiple of 24x:
$4.4 million / 39.68 million shares x 24 P/E = $2.66 pps
I don't know about you all, but I am exceedingly encouraged by the awesome potential we have here. And I have not even yet mentioned our CTBG spin-off shares -- yes, that amazing 1.89 shares of CTBG that we get for each share of GFCI that we own. I leave that for another time.
Been_Burned_Before
