High Risk for hopefully a Big Return for KALO shareholders.
If they get the $800 Ghana contract, the $50 mil market cap seems way too low IMO considering the company only has $1.6 mil in current TOTAL debt.
Rough finance calculations based on a possible A/S max of 15 bil and an $800 mil Ghana contract.
$800 mil revs x .50 EBIT = $400 mil x .60 (40% tax) = $240 mil/15 bil o/s = $.016 EPS x 10 PE = $.16 PPS. (MC = $2.4 bil)
Guinea contract only for $200 mil.
$200 mil revs x .50 EBIT = $100 mil revs x .60 (40% tax) = $60 mil/$15 bil o/s = $.004 EPS x 10 PE = $.04 PPS. (MC = $600 mil).
For me, the above shows the possible stock price magnitude of what a contract of $100s of millions would do for KALO. A small market cap given these sudden big revenue numbers makes no sense to me but even with these rough calculations, I'm leaning a bit towards a buyout/merger play. What would a $1bil Buyout or Cash infusion do to the share price overnight using 15 bil as the o/s?
$1bil/15 bil o/s = $.067 share price.
Just food for thought in the above numbers and obviously IMO if KALO comes thru with the goods in some way or another.
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