Cheers PoolmeisterBetween this report and 51Cap's recent podcast...

Cheers Poolmeister
Between this report and 51Cap's recent podcast interview there is SOOO much to digest!!!!! Its still all sinking in for me atm tbh The BY report is great in providing a lot of additional colour and background on a few things. The testimonials were great (we have heard similar before but this was deeper and more detailed), and also the Bene background and relationship is really quite incredible. The strength and symbiotic nature of the PAR-Bene relationship really does cement the company going forward (while other analysts overstate the 'risk of Bene walking' etc. seeming to overlook this aspect).
On the valuation - the DCF is all a bit like getting the number you want. They have done a lot of fine detailed modelling and then slap a massive 20% discount rate on the cashflow which just dulls the analysis and its assumptions and mutes the valuation. Using a 20% discount rate means $1 of earnings in 5 years time is ascribed only about 40c in today's money(1/1.2^5)! Seems unbelievably conservative (most discount rates used these days are much much lower) but maybe they didn't want to get laughed off the court posting a much higher valuation. haha
My belief is that raw product cost is very low (high gross margin), but I cant put my finger on where I got that from. Same as the mechanics of inventory and royalty flow - cant help there sorry.