In my opinion a takeover at $3 a share would be obscenely low! My rough calculations... $480mill diabetics in the world, if PIQ captured just 10% of this addressable market using their test annually it would be $48mill people. The proposed minimum royalty per test is $5.50 ($55 x 10% royalty). $48mill people x $5.50 = $264mill annual revenue. Conservatively, taking into account PIQ's operating costs... profit margin 65% of revenue. Annual profit would be circa $171mill ($264mill revenue x 65%). There is only $95mill shares on issue for PIQ... so an annual profit of $171mill would result in earnings per share of $1.80/share. Conservatively, EPS of $1.80 x PE ratio of 10 = $18/share. Imagine that... but please #DYOR
PIQ Price at posting:
65.5¢ Sentiment: Buy Disclosure: Held
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