What is the POTENTIAL REVENUE gain with the shelf in place?
Ammunition:
30MM Cash+20 MM LOC+200MM shelf = 250MM
Fact:
1. Average price of acqusition targets over the last 3 years = 0.8x Rev
2. 200MM shelf at 6.05 = approx 33MM shares.Total share count would be 65MM
3. 2022 Rev Runrate = 125MM
4. Above 350 MM Rev company forcasts EBITDA = 25%
If managment deploys all of their ammunition in 2022 (Doubtful):
At 0.8x Revenue 250MM can purchase approx 310 MM
2022 analyst concensus revenue = 125 MM
Total Potential Rev = 435MM
EBITDA @ 25% = 109 MM
109MM EBITDA / 65MM shares = $1.68sh
At Trading multiple of 6x = $10.06 = 67% upside
8x = $13.40 = 123% upside
10x = $16.80 = 180% upside
12x = $20.10 = 235% upside
NOTE: Deployment of all ammunition in one fiscal year is an unlikely POSSIBILITY NOT A PROBABILITY. Anything above 70-80MM would be a horizontal merger of equals and done to attain economies of scale and need time for digestion.
However, it is helpful to know the POTENTIAL revenue scale with the capital the company has to work with.
(PS bashers, I am aware that there are variables here which you will porobably refute, but I have chosen what I feel to be reasonable values)
Do your own DD, heavily invested, active trader