Replies to post #29018 on First American Scientific Corp. (fka FASC)

[charlie02356]

Patrik: I agree with a lot of what you say, but I have to correct your statement about, "reports of multiple sales". If you're talking about PRs, there haven't been any multi-sale ones, but those, when they happen, are what will move the share price substantially, IMO.

There are possibilities of multi-sales, as reported by a few posters, coming from different licensees. All speculation at this point, but I give it a better than even chance of happening. When? Hopefully this year.

I can't come up with any reason why Cal would want the share price to remain low. After all, with almost 10 million shares, and having spent many years building the company, wouldn't he want to cash in a mill or two?

Since he, and the company, have become public via Fascbook, I will continue to post questions at the site, in the hopes that he will be forced to address them. However, my most recent one did not illicit a satisfactory response.

Company web site is missing the last two PRs, plus a link to the FY2009 annual report. Rumor has it that a new web site is being developed. Is that true, and if so, when do you anticipate it being finished?

FASC's response? "Thanks, Charlie"

Let's hope the volume keeps up, BUT the pps starts heading north.

Cheers, Charlie

[TRCPA]

Patrik........take a look at my prior posts to get an idea of how KDS sales numbers can move the pps.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=47675216&txt2find=36|sales

D-all things remaining the same, that would equate to a $150 million market cap. (.75/share with 200 million shares outstanding).

For sake of argument and rounding (if we look at something approaching these kinds of continued sales increase numbers, it might even be conservative), let's use a 25 P/E.

That would mean that we would require earnings of $6 million for the year ($6 million earnings X 25 P/E = $150 million market cap.)

Let's add in a new variable.....earnings from joint ventures, i.e. FASC has a 50% ownership in the overseas ventures in Malaysia and Korea, and forthcoming, Brazil.

But let's start with KDS sales from outside of these ventures, and again assume for argument's sake that there will be a somewhat even distribution between those sales and sales from the overseas ventures.

Let's say the growth percentage slows, and we go from your 18 KDS sales this FY to 36 next year.....and say 60 the year after, which would be FY 2012 (Year ending 6/30/12).

30 FASC sales and 30 overseas sales = 60 total KDS sales.

Given current numbers, 30 FASC sales would yield about a $5,250 million gross margin at $175K per sale. Another 30 sales from joint ventures and overseas licensees is probably about another $750K in royalties, at $25K/per.

Say conservatively 20 of these come from the joint ventures. That would mean that the JV's are making something like $3.5 million gross margin on their KDS sales (again, at $175K/sales gross margin). Take off about $1.1 for operating expenses, and you have $2.4 million earnings.

FASC would get $1.2 million of this, based on their 50/50 partnership.

So now FASC has the following......

$5.250 million gross margin on their own sales + $750 thousand income from royalties + $1.2 million share of profits from joint ventures. That would add up to $7.2 million before operating expenses.

Now, subtract an estimate of their operating expenses (if we round, we can get to about $1.3 million based on latest history).

$7.2 million - $1.3 million = $5.9 million earnings.

So we would be there in a little over two years, following FY end 6/30/12.

Given recent history of sales increases, this is realistically in play, IMO.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=48572715&txt2find=36|sales

Charlie.....for the very short term, yes. I think those two year projections are within reach. As for now, if we go from 18 to 36 sales next fiscal year (July 1, 2010 to June 30, 2011), we're probably looking at something around .30 to .35 pps, given the same set of assumptions.

June 30, 2011 is 15 months away. Not all that long of a time.

[Fasctrack]

I too share your frustration with the stock price. I keep asking why the price is so blasted low.

I have concluded that today's investors are much more cautious and fickle. This Company has had a number of fits and starts and headfakes. I do not want to go as far as saying that there is a credibility problem. Rather I think of it as more of a product verification/market awareness problem.

From the viewpoint of someone who is thinking about buying this stock for the first time, the stock price itself gives one pause to question its credibility. I can imagine that someone asking themself if the company is for real, if the science is real, does the product really perform as stated, are the contracts for real, etc. The fact is the company is for real and the product works. Certainly there is enough information to be found on the internet to do some great due diligence to verify this, but what appears to be lacking just yet is true market awareness/acceptance. I don't know where that comes from or how we get there.

Perhaps it is the increasing sales model (along with increasing profits) that will eventually give the stock its due. On the other hand, there is nothing wrong about tuting ones own horn from time to time. On the heels of the Kevin Costner machine, I believe it is time to shout about the KDS from every rooftop for the world to hear.

For the last ten years, my wife has wondered where all of our "extra" money has gone. Every year I buy more shares and fantasize that this is our year. Every year I have been disappointed. I still have yet to see confirmation of a price trend breakout. For now I will continue to nibble. It has been a long road, but I truly believe our time is near.

[Waitedg]

Patric - Your post to me seems to have been the catalyst of the start of a lot of opinions ranging from extremely negative to "there is no clound in the FASC sky". I think Techisbest's post summarizes the situation about as well as anyone. A few other comments:

1. I think TR is incorrect in stating the price has tripled--unless he wants to take the low intraday of the year. This to me is not a fair comparison and could be misleading. I see an average price for the first of the year at about .016. and an average price right now is somewhere around .032--so we have about a double.

2. As Tech states the company does indeed have a credibility problem. JR's post gives some "comfort" in this area--regarding his direct conversation with Cal. Yet Jagman's cynicism certainly has some justification. Does Cal care about the investor? Will increase revenues go to fatten up insider's wallets? Is there any basic respect for the shareholder--and why are we doing all the DD and so little coming from headquarters?

3. As you mention, some of us are getting old (me likely the oldest here) and "opportunity cost" in 12 years of waiting gets more difficult. For me, my shares are going in my will to help others, but it would have been nice to see some of this payback while still alive.

Weighing it all together, Cal still has a lot to prove to the shareholders. I balance everything, and I am 95% a long term investor here--very long term--whether foolish or not. And my bet is still that patient investors will be very well rewarded. I do think, however, perhaps more of the risks involved here should be posted here. I think Techisbest, as I said, gives the most balanced postition. I remain bullish--but I must admit, that as a man of faith, my faith gets tested quite strongly at times. Waitedg