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Can they get there?, page-9

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evilsync

110 Posts.

05/12/16

16:42

Post #: 21115748
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Originally posted by PeasantOne ↑

The motivational driver for board, management, staff, and inov8.
(note - the following contains rounding and 'ballpark' figures, and is just considered thoughts from a peasant who considers himself figuring this stuff is akin to a blind man rock climbing)

Assume they get a deal with 5% royalty (about standard); and upfront payment of 1-2 million - enough to remain afloat until b/e. Instant sp boost to say 5-6c region.

Using the co.'s figures of 1% of the UI target market equating to 388 mill revenue I'm rounding it to 400 million on the basis of their being other target markets (POP, health & fitness, sexual aspect), and it's a convenient figure for guestimates. That is sales of 1.3 mill units p.a. which seems reasonable to me considering in U.S. and western europe alone is about 100 million potential customers. And I'm thinking this is per year given the sheer market size and other factors.
On the other hand it's sales of 3,500 units per day; looking at that I'm not so sure. However I keep in mind the licensee will be capable of a sophisticated broad and targeted marketing campaign; will likely include Asian middle class (doubling potential consumers); and will know how to use data/analytics to max advantage.
Anyway that would give us 20 mill p.a.; about 1c/share; at a p/e of 20 (about standard for sector) = 20c/share.
If sales are less: given a quality partner; recurring revenue; 8% growth p.a. (aging population, increasing population, rising middle class, fine-tuning of product and operations); ASB potential; a likely dividend payout (50%?); and a burgeoning financial war chest - I think the p/e is more likely to be in the 30-40 range. And there's the exchange rate factor.

In summary my 1st target on signing of a deal is 5-6c area, then say 15-25c, and potentially 10 times that in the longer term. Timeline - say a deal in '17, preparations through '18, ramping to b/e '19.

Feel free to refine my calcs and contribute your own thoughts...

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You miss the couldn't organise a F in a B factor.

ALT Price at posting: 0.7¢ Sentiment: None Disclosure: Held
1 Upvote

0 Great analysis

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Can they get there?, page-9

Top Stories

This biotech stock raised $11M in a risk-off environment. Its Alzheimer's drug could change the game

Cleo adds Royal Women's Hospital to its clinical trial for ovarian cancer diagnosis

History-making uranium sample grades and an imminent drill run. Infini Resources is poised to transform in 2025

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up