Revenue/PE - Mature Stage, page-4

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Space Cadet

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13/01/22

12:06

Post #: 58831870
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Originally posted by Friengineer: ↑

I think I started a thread on this topic 2 years ago but I can't find it, so here's a new one.

Everyone has their own entry/exit plan for their Brainchip investment, some crazier than others. My personal target is a share price above $25.

$25 per share would equate to a market cap of around $40B.

Now, what would the PE be for a company like this, obviously in the mature stage? 30? Perhaps a bit optimistic but let's go with that.

The company would need to earn around $1.4B per year at this PE ratio.

Assuming an average profit of $5 per chip/IP use, they would need to sell around 280M chips per year.

How can such sales be achieved?

Automobiles... Daimler sold 2.3M vehicles last year. If we assume in the future each vehicle will have 3 Akida chips inside (some have said 6), Daimler alone would result in 7M chips. Let's say we get a few other automakers on board by then, with total auto demand being say 50M.

Mobile phones... if we get one major, e.g. Samsung or Apple, both of which sell around 200M phones per year, and Akida is used on 50% of the sold models, that's another 100M.

Where would the other 120M in chip sales come from?

Defence is interesting, but I can't see it being a material contributor - we're talking thousands of missiles, thousands of planes, thousands of drones, thousands of vehicles... not quite the millions we're after.

Household devices... this a finger in the air guess, but in the absence of any competition, Akida would probably be used in 10% of household white goods and entertainment electronics. Again guess 1B global unit sales per year, would equate to 100M units.

There's still 20M left for my target, but I assume it would be accommodated through miscellaneous applications.

This would sound absolutely crazy for some, but in 10 years, I think it wouldn't be out of the ordinary and is comparable to companies such as ARM.

What are your thoughts/own projections?

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I would have thought you would mention gaming after the Megachips deal.

SC

BRN Price at posting: $1.39 Sentiment: Buy Disclosure: Held
6 Upvote

0 Great analysis

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Revenue/PE - Mature Stage, page-4

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