RE:RE:RE:RE:Insiders are NOT SellingStockRV wrote: I've been in this stock since $1 and have enjoyed the ride so far. What is it that makes you think this stock can move two decimal places into the $1000 range? For me this sounds insane and very unrealistic but I am very new to trading overall and sona was one of my first big investments.
Welcome to the world of investing StockRV! Read LOTS of good books written by people like Peter Lynch, and Benjamin Graham to start.
Share price tends to reflect earnings in the long run. The share price trades at a multiple to earnings. Low multiples being a P/E of 5, high being considered anything usually above P/E of 30 . P/E can get really high with darling stocks that are growing very fast.
Earnings = Revenue(income) - Expenses(costs)
It is expected that Sona will be selling it's antigen test at a minimum of $25, with a (guessing)margin of roughly 66%. Let's call that $16.50 per test of profit.
Today the share price sits at $10/share, so to get to $1000 per share, the company would need to increase it's market cap(total shares X share price) from a current $608million to $60.8billion. No easy feat!
Simple math says that at low P/E of 10, a company must have earnings of $6.08billion in a yyear to achieve that valuation.
At $16.50 profit per test sold, SONA would need to sell roughly 368.5 million tests to hit that. I think this is actually VERY attainable.
Now, here is where it gets fun. Let's assume a high P/E (SONA will be a darling if it's sales take off) and give it a P/E of 30. This would push the share price to 30 times earnings, or a share price of roughly $3000 per share
OR
at P/E of 30, they need only sell roughly 122.8 million tests.
Fun to think of eh?
Hopefully that helps!
Cheers!