NW Tech Capital, Inc. (NWTT)

[stervc]

NWTT Fundamental Valuation$$ Consideration…

Below are some thoughts that I have put together through logical deduction to show how NWTT ”could” be fundamentally justified to trade between .122 to $3.12 per share.

This past Friday, 14 Jan 2011, NWTT released news right before the market closed of completing their merger with a Canadian Gold Mining Company:
http://ih.advfn.com/p.php?pid=nmona&article=46031775

Within the posts below, it is considered that ”possibly” NWTT is about to release some kind of confirmation of having gold existing on its property from this Canadian Gold Mining Company merger in the amount of 1.4 million ounces:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=58849968
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=58863408

Many investors have confirmed with the company that there will “not” be a reverse split.

The company also released a response to a question within the previously NWTT news below indicating that investors should expect to see a NI 43-101 on their gold property from the merger:
http://www.otcmarkets.com/otciq/ajax/showFinancialReportById.pdf?id=41388

Q: Does the gold mine contain any NI 43-101 compliant data?

A: All of the exploration work on property has been done by 43-101 recommendation. All information about the past work on property will be made available.

For further understanding of the importance of having a NI 43-101, read below:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57937445

If the company releases confirmation of 1.4 million ounces of gold, given that the price of gold is at least $1400 per ounce, this would warrant a total valuation for NWTT as indicated below…

1,400,000 ounces of gold x $1400 per ounce = $1,960,000,000 in Gold Valuation

This would mean that the $1,960,000,000 would be considered Revenues from the 1.4 million ounces of gold pulled from the ground.

I think it would be fair to consider a 75% Net Expense Margin which would leave a 25% Net Profit Margin to consider as Net Income to derive an Earnings Per Share (EPS). I use such an amount because I believe it to be conservative for our purpose of deriving an EPS. Anyone can use the Substitution Property to use different margins higher or lower if they like, but the formulas used below are consistent with basic accounting principles for deriving an EPS. This means that the amount to be derived for Net Income under this thought would be below…

.25 Net Profit Margin x $1,960,000,000 Revenues = Net Income
$490,000,000 = Net Income

Now we can derive an Earnings Per Share (EPS) for NWTT. Keep in mind that this is simply a speculative fundamental valuation from the information that we know of from us investors here doing our due diligence (DD) to see if our NWTT investment is as good as some of us believe. So far so good, but the valuation won’t be considered an ”actual” valuation until the company releases numbers to justify what we believe and hope for. The formulas below are used to derive an EPS for now for us to consider…

Net Income ÷ Outstanding Shares (OS) = EPS

From the derivation above, we know what the Net Income is for our purposes within this post and below is confirmation that the OS is 4,757,459,479 shares:
http://www.otcmarkets.com/stock/NWTT/company-info
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=58857242

490,000,000 Net Income ÷ 4,757,459,479 OS shares = EPS
.102 = EPS

Now we must consider multiplying the EPS with a Price to Earnings (P/E) Ratio to determine where NWTT should fundamentally trade with knowing that a P/E ratio is a growth rate for the stocks that exist and trade within the same industry and sector as NWTT. Within the link below, we can clearly see that the P/E ratio for the Gold Industry is 30.60 for gold stocks:
http://biz.yahoo.com/p/1conameu.html

However, below, I will calculate a first conservative share price for NWTT from using 12 as a conservative P/E Ratio. Observe below…

12 P/E Ratio x .102 EPS = $1.22 per share valuation

This means that NWTT ”could” very well fundamentally be worth and trade in the area of $1.22+ per share from the due diligence (DD) that is being speculated about if it turns out to be at least as expected by many who are pro NWTT.

Here’s something else that must be considered. I used the word ”could” for some other reasons that must be considered. The valuation above is considering that NWTT ”could” trade at $1.22 per share if NWTT would capture the 1.4 million ounces of gold in 1 year. I don’t know the plans for any of their drill programs as much more would need to be released from the company to confirm their per year goals for the amount of gold they plan on capturing. Below is a consideration from over a 1 to 10 year time frame to justify where NWTT should fundamentally trade if they confirm the 1.4 million ounces of gold based on the $1.22 share price derived from 12 as the P/E Ratio:

1 Year = ($1.22 ÷ 1) = $1.22 per share price
2 Years = ($1.22 ÷ 2) = $.61 per share price
3 Years = ($1.22 ÷ 3) = $.406 per share price
4 Years = ($1.22 ÷ 4) = $.305 per share price
5 Years = ($1.22 ÷ 5) = $.244 per share price
6 Years = ($1.22 ÷ 6) = $.203 per share price
7 Years = ($1.22 ÷ 7) = $.174 per share price
8 Years = ($1.22 ÷ 8) = $.152 per share price
9 Years = ($1.22 ÷ 9) = $.135 per share price
10 Years = ($1.22 ÷ 10) = $.122 per share price

So as you can see, even if it took NWTT 10 years to capture the valuation of the 1.4 million ounces of gold from the model above, it would be fundamentally worth .122 per share. If I had to guess, I would think that they would have a plan to capture the 1.4 million ounces of gold within a 4 to 6 year time frame.

Now, let’s consider the share price as we did above, but this time, let’s use what really would be considered ”a more accurate speculation” considering the use of 30.60 from the link above indicating and confirming to be the ”actual” P/E Ratio for the gold industry as of today:

30.60 P/E Ratio x .102 EPS = $3.12 per share valuation

Again, the $3.12 valuation above is considering that NWTT would capture the 1.4 million ounces in 1 year. Now let’s consider a per year breakdown per years for 1 year up to 10 years, like we did above, for how long it could take for NWTT to capture the 1.4 million ounces of gold based on the $3.12 share price derived from 30.60 as the P/E Ratio:

1 Year = ($3.12 ÷ 1) = $3.12 per share price
2 Years = ($3.12 ÷ 2) = $1.56 per share price
3 Years = ($3.12 ÷ 3) = $1.04 per share price
4 Years = ($3.12 ÷ 4) = $.78 per share price
5 Years = ($3.12 ÷ 5) = $.624 per share price
6 Years = ($3.12 ÷ 6) = $.52 per share price
7 Years = ($3.12 ÷ 7) = $.445 per share price
8 Years = ($3.12 ÷ 8) = $.39 per share price
9 Years = ($3.12 ÷ 9) = $.346 per share price
10 Years = ($3.12 ÷ 10) = $.312 per share price

So as you can see, even if it took NWTT 10 years to capture the valuation of the 1.4 million ounces of gold from the model above, it would be fundamentally worth .312 per share. Again, if I had to guess, I would think that they would have a plan to capture the 1.4 million ounces of gold within a 4 to 6 year time frame.

Below are some more thoughts that I think NWTT investors should understand as to why NWTT is different and better than others in the past in my opinion:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=51342384
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=51342266

To add…

NWTT has 5 Reverse Mergers of which 2 are already completed:
1st -- The Bermal merger was completed last summer.
2nd -- The Canadian Gold Mining Company was completed this past Friday, 14 Jan 2011.
3rd -- The Silver Mining Venture based in British Columbia, Canada recently announced to still be in play.
4th -- The eco-lighting merger was recently announced to still be in play.
5th -- The Chinese Paint Company merger was recently announced to still be in play.

The ball is in NWTT’s court as all they have to do now is to prove what many of us pro NWTT shareholders already believe and hope they will prove with its valuation and the market should fundamentally realize where NWTT should be trading. As you can see from thoughts above, regardless to what P/E Ratio is considered for this newly merged Canadian Gold Mining Company, we are golden.

v/r
Sterling