To clarify, I wasn’t meaning specifically on the day of results being released. I was basing on the lowest traded value compared to the highest traded value within 2 month periods each of the past 2 years. Both falling in the May/June/July period. Which is 100% factual. I’ve added market cap with the SOI at each date as well, so it can be dilution adjusted.
25/5/23: 1.7c (18.7m)
11/7/23: 2.7c (29.7m)
Increase: 58.8%
29/6/22: 1.4c (15.4m)
8/7/22: 2.8c (30.8m)
Increase: 100%
So it is technically cherry picking values here, but regardless. I believe that the 1.5c that we traded at will be our lowest for this next upturn. So basing my thesis on this cyclical ‘trend’. And given the extent of the selling and the internal + external factors at play, we could see a far more volatile July than we have previously seen.
11/6/24: 1.5c (19.3m)
50% increase: 2.25c (28.9M)
100% increase: 3c (38.6m)
So both of these ‘forecast’ values of mine are not entirely unreasonable. Given the raise, enterprise values will be different at each share price point, so I’ve added those to my estimates as well. So for us to purely reach a share price that reflects the company value being only equal to our previously highest traded value, dilution adjusted would be 30.8m or 2.4c.
So as previously stated in many posts and this is my continued sentiment, what do you think ECS is worth? I have stated my forecasts and base my predictions as such. But post Q4/Annual report, I have a fair and reasonable market cap expectation of 2.8c -3.3c (36m - 43m). Which ‘could’ see an increase between our low traded value and my price forecast of 86% and 120%.
I trade using my own methods, but having the mean reversion theory at the top of my mind has proven time and time again successful. And it is clear that ECS is trading below a long term trend line despite long term values. Which may be in part due to factors that come with being publicly traded and liquidity, but also in my opinion as I continue to state, the market does not understand the ECS business model. The path to profitability is blurred for some but to me it is crystal clear. Just an arbitrary example of this being that VesiSorb IP for the Canada (and likely US) is in the hands of Curaleaf, for basically the rest of the world it is held by ECS. The fact that this phenomenal product is held by a multi-National company worth $5b and then a small farm in Victoria perplexes me. This value has not been priced in, alongside so many other factors.
So again, ECS has to almost certainly be on the radar of companies like Curaleaf to absorb. Patented strains, global exposure, exclusive global IP, vertical integration, GMP and EU certification and physical investments (land, facilities, production facility, staff). All things that these larger companies desire are held under the ECS name. To me, that’s worth something. And that something is in my opinion, is worth a LOT more than 30m, which I am sure that the board would also agree with.
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