These factors (and some others) would increase or decrease the...

These factors (and some others) would increase or decrease the base price calculated from sales, depending on the assessment.

For example, a positive assessment from sales success or delivery of innovation may result in an increased valuation.

Conversely, obsolete IP, lack of delivery of innovation or continual layoffs (particularly of engineering staff in a software company) and not being taken seriously by competitors are negatives that decrease the valuation. Layoffs tell me that the management of the company has a negative view of the prospects of the company.

In my view, an investor should do their own investigation and dig deeper than the ASX releases. This would include reviewing the patent and other IP, product development, staff turnover, demonstrated management capabilities and partner relationships. I’ve seen some very nice work by others who have shared information on HC they have found from alternative sources such as GlassDoor.

Good information sources are IP Australia for patent review (with assistance from a suitable person from the local university), LinkedIn for employee / director turnover information and discussions with competitors to assess the standing of the company relative to peers (I’ve had interesting discussions with the CEOs of two icetana competitors so far).