BM I think you provide interesting thoughts. I am unsure what is the norm in the USA but I think the following statement sounds reasonable: "Private companies tend to sell for roughly 5x to 10x their annual profit."
"IQST adds alot of value due it it's proven cross selling capabilities. That means the seller gets to keep 49% of the company and will benefit from the future growth he expects will happen by joining IQST."
I understand your reasoning. I think that there may be some value in possible cross selling. It may depend to some extent on the kinds of businesses that are involved. I doubt that the value of this can be quantified right now. Only time will show.
"They have even stated they expect to double the potential acquisitions sales by 2027." I will not attach much importance to this statement. Neither of us have followed this company for much more than a year as far as I know. But I have read lots of posts by a poster who remembers promises made over several years. There have been mentions of uplisting to NASDAQ over those years I have read. Because of what seems to have happened in the past I pay little attention to the statement of doubling the sales of acuisitions by 2027. It comes easy for some people to present such expectations.
"Lynk Telecom as an example is supposed to add 1M per year, 51% to IQST would be 500k. They negotiated to only pay 1.5M so 3x annual profit which is well below the norm."
It appears that this will be an attractive acquisition for this company if it becomes a reality. Based on my memory regarding the previous acqusition that was on terms that were way less attractive. To be conservative I would suggest using those terms to evaluate the effects of the big coming acquisition referred to.
Another important unknown at this stage is how the spending of 30 million dollars will be financed. With the very low equity and the minimal profits this company has the financing terms may be pretty harsh. I dont see the pps jumping to 2 dollars this year or next year. A dramatic reverse split is an alternative but I doubt if it is a good idea. As the situation is now I doubt that this company would be well received once there is a NASDAQ listing.
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