Biostar Pharmaceuticals, Inc. (BSPM)

[Michael Anderson]

My final 2010 Full Year Estimates based on management guidance of seperate revenue streams and growth from 2009 production:
(adjusted from Viking86 recognition of mistake on my initial estimate, plus one revenue stream added)


Full year revenue for 2009 was 53.3 million and about 10 million of that was from the rural networks(about 5,000 networks @ about $2000 each). My estimation is that they will grow revenue for last years products at about 10%.

53.3 - 10(rural network growth incl in diff estimate) = 43.3

43.3 * .10 = 4.33

43.3 + 4.33= 47.63

growth from 2009 production (not including Tianjin):47.63 million

Beijing & Shanghai(1/10, Tianjin(11/09): 11 million

Raw materials: 7 million

Zushima: 2 million

Xian Meipude: 3 million

4 new markets(4/10): 9.3 million

Rural networks: 17.2 million

Yi zi, Tang Ning, Sheng Jing: 2 million

-In 2009 they expected 4 million in full year revenue from these products and they did not end up selling these in 2009. I am using 2009's estimates for these and they are expected to get revenue from these in 3rd quarter and the 2 million is my guess.

http://www.hcinternational.net/pdf/client_overviews/BSPMcorporateprofile.pdf

email - nutrients & Ganbao: http://messages.finance.yahoo.com/Stocks_%28A_to_Z%29/Stocks_B/threadview?m=tm&bn=88940&tid=4207&mid=4207&tof=24&frt=1


Total = 99.13 million 2010 full year revenue


Currently for the first quarter for 2010, SGA % of revenue is about 50% and in the second quarter it will be high due to expansion in the quarter, but as the year goes on, I believe and it was stated in an email from someone else, that it would be about 45% year end.
With that in mind. Right now income/revenue is about 18% for 1st quarter 2010 and with at least a 5% decrease in SGA spending.

18 + 5 = 23% for income/revenue


2010 full year income: 99.13 * .23 = 22.8 million


In the conference call the stated that there would be no issuance of shares. There are currently about 27 million shares outstanding.


Full year 2010 EPS: 22.8/27= .844


P/E based on 2010 full year earnings with share price on 6/29/10: 2.97/.844 = 3.52


In my opinion P/E should be about 15 due to the growth, expansion, and pipeline of the company

based on these estimates with a P/E of 15 = 12.66

examples of different scenarios:
Even if they were to issue for example 5 million shares in the next year for expansion and further growth. That would be a total of about 32 million outstanding shares. With that scenario and my estimates for income:

22.8 million net income/32 million shares = .7125 EPS
P/E on $3 = 3/.7125 = 4.2 P/E

Another scenario, if they issued 7 million shares and hit the low end of their net income guidance of 18 million

18 million net income/34 million shares = .53 EPS
P/E on $3 = 3/.53 = 5.6 P/E

Regardless, this stock is very undervalued even if it comes in around their guided estimates and even if they need capital through a stock offering. Plus, SGA/Revenue is going to decrease over the next couple of years which will also significantly increase income on top of their continued growth


My other example estimates, but has links to most of the data:

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=51334787

Email from Ms. Zhao about rural networks:

http://messages.finance.yahoo.com/Stocks_%28A_to_Z%29/Stocks_B/threadview?m=tm&bn=88940&tid=4029&mid=4029&tof=1&frt=1