Chalice Brands Ltd CHALF

RE:RE:Q4 revenues

[slimjim11]

Preface my comment with disclosure: I own 667,900 shares, average cost just under $0.54. Take the following with whatever grain of salt you will. The fourth quarter of 2015 and the first quarter of 2016 will have some noise with regulatory action and costs of setting up the strategic partnership with BMF. Careful reading of the financials should reveal trends and efficiencies. It'll be sweet if GLH gives us a Q1 pro-forma, presenting the numbers as if BMF happened on January 1. That would make our job as investors easy. By the second quarter data which will be released at the end of August, I expect to easily see the exponential ramp in revenues and margins. It won't take any sleuthing, or careful reading of a financial statement, it won't take a spoon-fed pro-forma. By Q2, I'm expecting to see $12-$15 million of revenue in the quarter, annualized that's $48 to $60 million. I expect GLH will be the recognized market leader in an emerging multi-billion dollar industry, where consumers are already familiar with the product. This is not a standing start with a brand new product to introduce to a sceptical market, only a standing start for legal recreational. How will the stock market value that opportunity? That's guesswork at best, but I think a multiple of 10x revenue is a reasonable guess, if management continue to execute with professionalism. That gives us a market cap of $480 - $600 million by the end of August. With 100 million shares outstanding, that's a share price of $4.80 to $6.00. In this analysis, I've made a bunch of estimates, I'm sure some will be wrong. I am long the stock because I believe the gap between current share price and reasonable guess of where this is going, is just too compelling to ignore.