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buyittradeit

04/03/09 1:40 AM

#2558 RE: FORDGT #2557

And how did you come up with that estimate?
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mike306oh

04/03/09 8:52 AM

#2561 RE: FORDGT #2557

Who cares about those analysts. Rather (while you are looking at Yahoo finances) learn to do your own valuation:

1, Go to annual financial data - you'll notice an explosive gross revenue, which is good.

2. Go then at the quarterly results, and see the last line (net revenue), and you'll see that for the last 4 Q's the bottom line is getting better and better (near the break down), which is very good.

3. Last go to "Key statistics" and check out the main indicators, i.e. the Price/Sales ratio, which right now is about 0.01, which is way too low. The average P/S ratio for a penny company with proven, and growing gross revenue is between 1 and 2, and even larger if the bottom line is improving. Of course, we are not talking about sexy penny companies, for which the P/S ratio can go as high as several thousand. Based on data we already know, and assuming a P/S ratio of 1, the PPS should be 1/0.01 = 100 times higher, or about 0.04. This is also assuming the 10-K won't show a big decline in the gross revenue/bottom line, or a big increase in the OS.

Conclusion: The PPS appears way way undervalued, even if the 10-K numbers show a decline, unless the OS has increased significantly.

Mike