Replies to post #3459 on Alternet Systems Inc (ALYI)

[Vintage1776]

This company is known for putting out outlandish projections, they currently don't have any revenue growth its all just cleverly worded fluff,where's the 20million in orders, where's the electric motorcycle, what happened to the collaboration with the professor for the hemp storage tech , are we growing hemp in Africa now ? If they can't compete with the Chinese electric motorcycle market in the U.S. how are they going to do so in Africa?.

[lesgetrich]

Assuming everything is on the level and they are able to pull off this $20 million order, my analysis points to a price as high as $1.00/share as still being rational. Here's a reprint of my post from April 2 substituting the current OS value in the calculation...

The contract hasn't been signed yet so I think that's holding back a big run. Back in February I presented an argument for why I thought the $.09 target price for ALYI was rational...

see ALYI Post # 2421

...Using the same technique...

If we assume they have $22 million in contracts ($2 million signed and $20 million likely near term) and they can realize a 20% profit margin...

$22,000,000 x .20 = $4,400,000 earnings/profit

$4,400,000 / 320,396,851 Outstanding Shares as of 5/29/2019 = $.0137 EPS

$.0137 EPS x 72.96 PE = $1.00/share

Consequently, $1.00/share would be a rational valuation for this company assuming that they are successful in landing that $20 million order.

Folks, this stock could be severely undervalued if they land this order.

...Again, this is not a price target. There are too many unknown variables (e.g. we don't know if 20% profit margin is doable in this market). However, it points to $1.00/share as still being a reasonable valuation for this company. In any case, it reveals that the current share price is extremely undervalued for this company if you accept that they are likely to realize $22 million in revenue in the next 12 months (if you cut the profit margin in half, you're still looking at around $.50/share).