Replies to post #322624 on Avid Bioservices Inc (CDMO)

[patientlywaiting]

Thank you!.... .You have the ability and knowledge to communicate what I'm feeling, something I can only broach on the simplest level. Avid with 200+ employees and NO business with this talk of $20 and $40 SP projections. A BP buyout down the road because they don't want to build their own, a buyout that would amount to the cost of reactors, a building lease and any minimal tech that's involved. What sometimes gets confused here is the positive company outlook for the purpose and hope of a trade in mind. With the ASM just a few days away and no apparent news the $3.81 SP is pretty dismal. Avid will never become the cash milking cow PPHM was with it's science related news. PPHM had cancer meetings it attended throughout the year that were known to be market movers. Avid is left with a possible announcement of some contract or attendance at some manufacturing show but that's it. Nothing really to trade on and no way to anticipate it. How many times can CDMO have it's "potential" pumped? The only reason for traders and trading longs to stay in Avid is if the IP is licensed with down the road milestones written in. An outright sale of the IP may just be Avid/PPHM's last big trade.

[sulaco]

KT, EBITDA is earnings BEFORE interest taxes depreciation and amortization, NOT after.

Your numbers are wrong. So is saying Avid is worth just steel tanks, setup, and design with single use state of the art tech.

No, no, no. Avid has Federal approval and a clean Federal audit record. THAT is where the value is. The CDMO space is very valuable and growing rapidly. You re right that EBITDA is not based on sales, but your numbers are not in line with EBITDA. Your numbers are NET NET earnings.

Best, Joe

Support Avid production capability while seeking new orders. If current Avid capacity of $100 million+ sales turns EBITDA of $33 million (a one third margin), assigning that 15 to 20 multiplier for shareholder valuation of $525 to $700 million. Figuring about 50 million shares, that is support for a $10 to $14 pps, which is a good reason for shareholders to support some carrying cost for production staff until sales can be realized. However, if it takes more than a year to fill the order docket, carrying costs need to be carefully monitored and staff size managed accordingly. Yet, which Pharma would give an order if production was not "ready to go" vs. the order must wait while Avid staffs up?