Bob you miss the point. You somehow assume 1500 aircraft in a year. 3 questions:
1) How can you assume you fit every applicable plane in the world in one year? That is not how adoption rates work? Firstly, that's a ridiculous conversion rate, must be the world's best sales team. Given the time every step has taken do you expect the sales process instantly closes with every available airline and every one of their planes immediately? Secondly, that's a huge number of sensors I very much doubt we have geared for that capacity. I haven't seen anything suggesting we hit anywhere near that run rate out of the gates. 2) What next? As noted, we are selling sensors, no licensing tail fees. So you've just served the market in year 1 with your sensors. Does year 2 revenue/earnings drop to 0? If so no one is paying 30x for a 1 time peak earnings level. 3) Are you conveniently forgetting tax and interest and putting PE's on EBITDA again? $70m rev if we sell out, Delta's cut, then 80-90% margin then interest and tax to be deducted how do you get $50m.
I want this to work as much as anyone but let's sprinkle in a touch of reality?
SMN Price at posting:
50.0¢ Sentiment: Buy Disclosure: Held
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