RE:RE:possible share priceYour analysis assumes all sales made in one year.
Not likely.
What the market is waiting for is the rate of implementation by each client.
If Client A is the BIG one for a total PO of $1.5 B it will most likely take a staged approach to installation.
I doubt 40% of that total will transfer to the bottom line in the first year.
The market needs a look into Year 2, 3, 4 sales and beyond if possible, in order to get a grip on potential future valuations based on a path of ever increasing earnings.
Using a 40% margin and a 20 P/E multiple, the current Mkt Cap of $800MM is asuming about $40 Million in earnings on$100 million in sales in the coming year
$100 million in sales equates to about 30 torches in Year 1, about 3/month.
Everything that PP has indicated is that this is certainly doable.
If additional clients book with PYR and the sales look to double in Year 2 (60 torches), and again in Year 3 (120 torches), reaching towards $4-500 Million in sales, then a 40 % margin on about $500 million gives an earnings of $200 million, and using a P/E multiple of 20 we could see a Mkt Cap of $4 Billion.
That would see the share price in the region of 4,000M/150M=$25.00
And that is WITHOUT trailer earnings from ongoing maintenance.
And that is WITHOUT any sales of PYR's Drosrite, or powders, or any contribution to valuation by HPQ.
I don't count on regular sales of the PAWDS being of any relative importance beacuse it takes 10 years to commisiion and build an aircraft carrier, which is the only navy ship to install a system to date. (but the potential is there for 'household versions' for the tourist boats - whenever they get back in business from COVID)
It all starts soon with signing of the first contract, and the details surrounding the rate of installation.
A bigger unknown is the P/E multiple that the market will ascribe to the enterprise.
A quick check at
https://csimarket.com/Industry/Industry_Valuation.php?ind=207 gives
Industrial Machinery and Components Industry
Price to Earning ratio is at 36.86 in the 2. Quarter 2020 for Industrial Machinery and Components Industry,
Price to Sales ratio is at 2.7,
Price to Cash flow ratio is at 20.61,
and Price to Book ratio is 5.13
.........................................
Note the current P/E of the Industry ABOVE!
Nice!
Using that P/E multiple means that the market is currently only giving PYR $25 million in Earnings for the coming year.
Peter has allready stated that the next Quarter will see $0.07/share earnings.
If that holds steady for 3 more quarters then a full year Earnings will be $0.28./share
That equals or about 150MM X $0.28 = $42 million
At a 37 P/E multiple (the current industry average...see above) that gives a Mkt Cap of
37 x 42 million = $15.5 Billion
That equals a 20 times UP from the current MKT CAP of $800 million.
..............................................................................................
You can make do the math from here on where PYR may be trading in a couple months, years...
I'm invested and waiting on the NR that will start what I believe to be a parabolic rise in the stock from this current price benching area.
kingscorpion wrote: Parksville wrote:
How does one calculate possible future share price based upon possible future earmings?
You take the future revenues I this case companies ABC collectively which in our opinion will come to about $6 billion Then you take the net revenue at about 40% which comes to $2.4 billion Divide this number to total shares outstanding in PYR case 150 million shares You ll get E/S over $10 Then you add a PE multiplier conservative 2 And when the job is done a PE multiple of anywhere from PE 10 to PE 30 possibly more if the market falls in love with PYR The share price projection is huge and the current price is still extremely cheap