A Going Concern qualification, despite $41m in revenues is one reason why using revenues to value Pinks, like UBRG, is not the smartest approach.
The Auditor (who, I hope you'll agree, is not a basher of the stock) makes it clear that despite record revenues of $41m the company remains dependent on raising cash/equity because it has insufficient profit from those revenues to support its G&A costs of $1.2m.
So, putting aside the accummulated losses of $16m (because that's not unusual for a start-up)the real issue is the profit margin on the revenues. And that is the valuation issue to address, whether or not it's a Pink stock.
Your statement that I have given a negative tilt to the variables is plain wrong. Take another look, and you'll see that I have placed the best possible interpretation on the UBRG figures to do the eps valuation.
I have taken their projected $1bn in revenues at face value; I have assumed no additional share issues (even though you know there will be); I have assumed that operating costs do not increase (even though they will); and I have not discounted for the $16m of accummulated losses (even though this should be done.
Where is the negative tilt?
You asked for an open discussion about the issues. So let's have one that looks at the facts on which you have based your view of the stock.
My view remains that UBRG is a stock for traders. Because it does not have the underlying business (or management)to support a long-term investment. I'm stating the obvious truth that you can make money trading on the sentiment of a stock like UBRG, even when that sentiment is not supported by its underlying business. That's not bashing the stock.
What's your view?
AI
