I am not saying A2M is a bad company and never have. What I am saying value is not growing like the share price would have us believe. If the price can come back to its real intrinsic value and not the imaginary one people are talking about. Then I will definitely buy. Also there are a lot of assumptions in your post. None of which are guaranteed as of yet. So just remember that. Now lets presume hypothetically those numbers ends up being true. 900m revenue. NAPT if 160 million. My value is between $2.50 to $3 range. Even with NPAT of 300 million. Value is around $4. Current price $5.90. Was $6.50 the other day. To me that indicates the market is expecting results to be better than what even you are quoting. If they are not expecting this. Then sadly they have all become irrational and simply buying this stock for no other reason than it is going up. And don't want to miss out on the rewards if it continues to rise.
Now lets look at the other side. We know the share price is rising faster than value. Because the market has decided that this stock deserves to be trading at a premium to real value. Based on a hypothetical projection. Now what happens to your theory if for what ever reason people stop falling for the hype. Sales begin to decline. Revenue reduces and so does the profit. With all the extra premium already factored into the share price. This thing will collapse into the abyss. If those numbers are just slightly less than what people are expecting. Your whole theory is based on the fact that the worst case will not happen to this stock. We know in the stock market that the probabilities of things not working out like we wanted are very high. Look at TLS, TPM for example now. Last year they were making new highs daily (euphoria everywhere) and now the end of the world is nigh. Why people want to ignore the risks and only focus on the hypothetical reward is crazy IMO.
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