Already, first off, I doubt management would accept a $20m takeover, I think they spent close to $30m just to develop the tech. Then the tens of millions of dollars spent keeping this afloat over the years. So, I doubt they would accept anything less than a $100m takeover, considering CGT & fees will need to be paid as well. But let's put that aside for a moment, let's look at the fundamentals.
WAY 2 VAT LTD. (ASX:W2V) - W2V fundamentals, 77623247, page-1 - HotCopper | ASX Share Prices, Stock Market & Share Trading ForumWhat happens if this becomes CF+? Well it could..........
- Support itself.
- Develop new products.
- Develop new/different tech for another sector.
- Enter new markets.
- Pay a dividend.
- Acquire other entities.
The list goes on.
Let's say some one bought this at IPO & spent $1k.
$1,000 / $0.20 = 5,000 shares. So, their buy average is
20 cents.Let's say they buy another $5.1k at 3 cents if it appears this company might go CF+ soon.
$5,100 / $0.03 = 170,000 shares. But now their buy average is now
3.5 cents.So, you bought at
20 cents, the SP is currently at
3 cents when you average down but
your new buy average is 3.5 cents. If the SP reaches 4 cents you've made a profit. The SP doesn't have to reach 20 cents to get your money back. Sounds simple right? But it's not!! You have to time the market & it's not easy to do. Lots of risk involved.
Below is the calculation.
Like I said,
play around with those calculators & find out how low you can get your buy average. See what happens if you sink another $10k on CF+. Maybe $20k? Instead of buying at 3 cents you buy $2k worth of stock at $0.007?
The buy average will change.Of course, there are lots of variables including SOI, the amount of money you initially threw at this, the SP when you average down, your own buy average & length of time to CF+ which will affect when any particular individual could achieve the above scenario.
It's just a basic example.I plan to average down when/if this becomes CF+ or on any other significant news/events.
None of this is investment advice, these are just my thoughts & what I plan to do. But lots has to happen around here before I even consider buying more stock.
(20min delay)