Sorry Sparkz, I forget that I have to explain things in simple terms for you.
There is a different between current asset value, which would be used for our balance sheet and future value. See - https://smartasset.com/investing/future-value
Future value would say that if an investment is worth $15,000 but based on forecast growth and potential return, would be worth $150,000 in 5 years, then the future value is $150,000. Businesses are often sold based on future value, even though the current book value may be significant less.
It's the same way the MCs of companies on the ASX don't match their balance sheet. Let's take another one of my investments as an example - AVH. This has a market cap of $1.1b, but only under $30m in net assets on their balance sheet and only $7.7m revenue generated last FY. However, the growth potential is astronomical and the market is expanding rapidly. Their Market Cap is far higher because the future value of the company gives it a lot more value than it's current asset/revenue position. If it were to be sold, it would sell for far more than their assets/revenue. This is why you have a difference in the sale value and asset/book value.
MXC Price at posting:
3.4¢ Sentiment: Buy Disclosure: Held
