I think the market has thrown LRK out with the bathwater that was Bainbridge. Annualised Q4 sales as you note, at a reasonable 8x sales multiple would see an Lark with a base case valuation (from an acquirer) at $217m - surprise that this is the Mkt cap today.... While that multiple price in growth, it fails to capture the scale of the growth potential that LRK has in front of it.
Track forward 12 months, exports are up and running (using those litres that haven't been sold this year and the litres maturing this year - they have the stock to now execute the exports). Would not surprise to see full year sales at +$30-$35m and a Q4 of +$10m (taking annualised sales for Q4 to $40m, and an implied sales multiple of $320m..
So there we have it, my 12m price target of circa $4.20.
Sometimes we overthink these things. It is good to dive into the detail to look for said skeletons and understand the business and risks, I don't believe any of these will be material (and I don't think you do either based on your sentiment)..
Cheers.
LRK Price at posting:
$2.88 Sentiment: Buy Disclosure: Held
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