Defabstar,You assume a PE of 10 based around a 10 year forecast...

Defabstar,

You assume a PE of 10 based around a 10 year forecast ie that in 10 years your investment would pay for itself. Of course reality is completely different and you can only apply a PE on its merits depending on the company. If you can guarantee that a company will earn 1mill profit over the next 10 years then yes a PE of 10 is justified. If there is risk however or uncertainty then that needs to be taken into account.

In May TOX still made reference to the upgrading of the plant. The premise was that, yes, the profit per tonne would be less, but the much greater throughput would create much larger profits. So the question is why have they decided not to upgrade? If it is that they dont think there is enough business to warrant it, then that is bad thing as it doesn't say much for potential growth at relatively low cost. If they are wanting to ensure a water-tight contract before spending the money to upgrade, then that can be pereived as a good thing because they are being monetary responsible.

Personally I believe, there will be a decent contract in the pipeline, which will really take TOX to a new level, however until that time, there remains a risk.

Cheers