Replies to post #83484 on Alliance Creative Group Inc (ACGX)

[puffadder]

Can't apply PE to otc stocks as valuation ...

is all about future events. Most don't even have a PE.

ACGX last quarter profit was buffered by all the shares issued to cover convertibles (SG&A was very high).

Check out LIGa with 2.2 BIL OS trading at .013.

[cwg8008]

***Calculation-Fundamental*** forwarded from poster Han2004fl

Han2004fl Friday, 03/30/18 05:08:24 PM
Re: None 0
Post #
83269
of 83487
** THE CALCULATION - FUNDAMENTAL **

Large cap companies are happy to make 3 to 5% net earning off sales.

If we are to reverse calculation on ACGX at the current net earning per share:

$584,410/1,875,103,928 (current o/s)= 0.000311 a share in net earning.

Using Trucking Industry P/E of 29: 0.000311 x 29 = $0.009 per share
Using Packing/Container P/E of 51: 0.000311 x 51 = $0.0159 per share

Now, what should market cap be for ACGX if we are to get 3% return on investment?

3% return = $584,410 therefore market cap should be $19,480,333 OR $0.0103 per share

5% return = $584,410 therefore market cap should be $11,688,200 OR $0.0062 per share


ACGX's net earning return on sales is $584,410/$18,322,208 = 3.18%
PPS should be $0.0098 per share.

During the CC, we CAN expect lower cost and higher revenue. With the new partner, this should lower the cost significantly. This is a young and growing company and in a fast growing industry. I say you can multiply that by 2X to 3X.

Our gross profit margin is $3,675,008/$18,322,208 = 20.05% = $0.00196 per share per year.

Some people evaluate stock price using sales. Since this is a young company with high growth, a premium of 2x to 3x of sales seem appropriate.

@ 2X of sales = ($18,322,208 x 2)/1,875,103,928 shares = $0.01954 per share

@ 3X of sales = ($18,322,208 x 3)/1,875,103,928 shares = $0.02931 per share