GM Dave & MOOvers! - I've revised my PPS valuation of NVSR, please see below valuation and my support for the valuation...sorry for length, but I think it's worth the read.
River's Valuation of NVSR PPS (Crystal Ball syndrome)
I've been a STRONG believer in NavStar and their EOBR opportunities! That's what I've banked my entire portfolio on, NOW it apparently is a NEW BALLGAME! all my previous valuations for this company are out the window and have just taken on a new light....my valuations have at least doubled after April 4th's PR,
if they get a "Large Truck Manufacturer" to add the EOBR/Asset Tracker to their production line, then my valuations will be increased 5-fold at a minimum.
Current Price: my old valuation = should be trading in teens right now my new valuation = should be trading above $0.20 right now
Mid-Summer Price: my old valuation = approx $0.30 range my new valuation = between $0.50 to $0.60
by Years end Price: my old valuation = will reach $1 my new valuation = will reach $2
If we land the Truck Manufacturer in the next month or so....we will reach $1 by summer and $4-$5 by years end.
These are NOT any to-da-moon valuations, these are my honest beliefs based on the Current Share Structure (11.6M Float) and the business/revenue opportunities that I'm seeing management working toward. All we need now is execution in the next couple of months.
Here is the support of my Valuations above: Again, we need execution, but with the below POTENTIAL and my conservative 1% market share usage, I am confident these figures are attainable. If you think "I'm out of my mind" or just "blowing this up with wild and crazy #'s" then chew on this for a little while.
EOBR Industry = 16-20M Trucks in use - 1% market share equals 160,000-200,000 Units @ 1,000 each = $160-200 Million in Revenues
Now here's some stats behind my further calculations http://www.truckinfo.net/trucking/stats.htm as of 2006 data How many trucks are sold in the U.S.? Approximate average of 192,000 per year (or a 1.1% turnover rate taking new trucks divided by Current 16M trucks)
How many trailers are sold in the U.S.? Approximate average of 280,000 per year (using the same turnover rate as above this give us an estimated 25.5M Trailers in the US - this is a conservative estimate as many trucks have more than 2 trailers, but we'll leave it at conservative)
Trailer Industry = 25.5M Trailers - same 1% market share = 250,000 trailers. If I recall from a long time ago, the Asset Trackers only without EOBR functionality for approx $500?? need confirmation in that figure. So 250,000 trailers at $500 per unit = $125M in Revenues,
"Large US Truck Manufacturer" = above 2006 figure said 192,000 new trucks sold in US per year - there's approx 6 different Truck Manufacturers, so for ease of math, 192,000 / 6 = 32,000 Trucks PER YEAR @ $800 per unit (I'm sure they will get a discount) = $25.6M Recurring every single year!!!
Recurring Service Revenue - Now take the recurring Fleet Management Service Revenue to the EOBR sales and New Truck sales @ $50 per month = let's just use the 1% market share of 160,000 trucks times $50 per month times 12 months = $96M PER YEAR recurring revenues Now add the 32,000 new trucks each year form the manufacturer = $19.2M in Revenues each year, but in perpetuity, meaning that figure grows by $19.2M each and every year with the new 32,000 trucks coming out!
Other Opportunities....well...do I really have to go on about RV rentals, Car Rentals, Moving Truck Rentals, ATV's, Motorcycles, Boats, Cargo Containers, Personal Trackers, geezzz...I think you should get my point by now.
If anyone can poke holes in my valuation, please do so. I'm open to other interpretation. Of course I know this all requires management execution, so don't try that one on me.
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