Hi Dhukka ... would be interested to know how you come to your valuation of low 20 cents? Not that I agree or disagree really. Just curious.
In some ways it should be a combination of simple EBITDA multiple, then whatever premium or discount one decides to apply for whatever factors one values.
One thought of mine is EBITDA of 6, giving market cap in 12 months of say $54M (on EBITDA of $9M). That would be SP of say 34 cents. Lowish presumed multiple takes into account this being a small cap so discounting, however the current low debt (vendor finance only) plus expected organic growth, could justify a premium. Hence from here 30% to 40% upside over 12 months, plus a bit for over shooting as happens (maybe).
If you have a formula / tool would be happy for u to send it to me [email protected]
MJS
2012 guidance, page-9
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