, post: 16588966, member: 111051"]Price to sales ratio for A2M for FY16 with today's share price is 2.81. For BAL to achieve same ratio, it needs $430M AUD sales for FY16. FY15 Sales for BAL is $135M. The million dollar question is will BAL achieve it??? It needs to increase revenue by more than 200% (more than 3 times revenue of last year) to achieve comparable price sales valuation.[/QUOTE]
I think with the price hike and extra demand 200 to 300 percent increase isn't out of the question. Something not added into the equation is recently 15% of Bal formula is exported to china and sold at a mark up of about 300%. Assuming there profit margin is a whopping 40% in OZ a 300% mark up would make profits at 790% for 15% of there sales which would mean that revenue from china would make up 3/4 of there total revenue. Keep in mind that china distribution is only recent and I'm not sure but of the impression that china wasn't a factor for FY15 report. Long story short I do think 2 to 3 times the profit isn't too far out of the question. Am I still missing/overlooking something light?
BAL Price at posting:
$12.03 Sentiment: Buy Disclosure: Held
