Alt Energy calcs and Alt With Bitcoin. Navs and ev/ebitdaI made a mistake with with Alternative energy Calculations the other day as I forgot to add in the solar polar which starts to come on to the revenue stream soon as it only runs during the sunny months. the solar power green certs get double the cash as the wind does.
so the company will be have 10 million in free cash flow from the energy business in 2018, not the 8 million as i stated in my last post.
with the bitcoin price going down and most likely going down more as we seek a bottom, below are all worst case bitcoin scenarios and how this company should be valued.
also, remember that when the price does go low, this company is still profitable not just because its alternative energy business is doing well, but because we own the energy, they use a fraction of it to power the bitcoin mining for free. This advantage lets this company be profitable mining bitcoins when most miners will be shutting off their machines. It's an unknown how many more bitcoin they may be able to mine in that scenario or if they'd be able to buy other companies machines at extreme discounts who just want to exit the space.
obviously we want a higher bitcoin price, but for right now, we barely have any machines and these lower prices will actually help this company enter this market with a lot less risk if management patience has worked and machines will be purchased for fair or discounted prices.
i went off on tangent there, but here are my calculations that everyone should understand. i've used $5000 and less for the bitcoin price as that where i think it will rest for a little bit before and if the bitcoin price goes up again.
at an 8% discount rate, the nav is 35 cents without bitcoin
at 8% discount with $1000 bitcoin, the nav is 46 cents
at 8% discount with $2000 bitcoin, the nav is 54 cents
at 8% discount with $3000 bitcoin, the nav is 62 cents
at 8% discount with $4000 bitcoin, the nav is 70 cents
at 8% discount with $5000 bitcoin, the nav is 79 cents
right now we are trading at a 10% discount without bitcoin as of this writing.
now on an ev/ebitda basis, we are currently trading around just under 5 without bitcoin factored in, whereas most alt energy companies trade at 7.6 to 13.6
so lets just use 7.6 for now, and not worry about 13.6 as this stock should be trading the low end of the norm at least
without bitcoin, at 7.6 times ev/ebitda, the price of the stock should be 47 cents. which is pretty much where the financing took place.
now with bitcoin at a linear hashrate growth
$1000 bitcoin plus energy at 7.6 times ev/ebitda the stock price should be 57 cents
$2000 bitcoin plus energy at 7.6 times ev/ebitda the stock price should be 67 cents
$3000 bitcoin plus energy at 7.6 times ev/ebitda the stock price should be 77 cents
$4000 bitcoin plus energy at 7.6 times ev/ebitda the stock price should be 87 cents
$5000 bitcoin plus energy at 7.6 times ev/ebitda the stock price should be 97 cents
i really don't know why we are trading at 30 cents at the moment with continuous selling pressure and what seems like no buyers.
obviously we need more press releases, we need mining machines up and running, and we need good deals being made. it would be nice of management put out a monthly update on operations or maybe a quarterly update soon as well.
i think its important for people to understand that as long as we're mining, we'll be making more money than if we sold that small amount of power, so even though if the bitcoin price goes lower, it still adds to the bottom line of this company in a big way while other miners will be losing money and having a hard time staying in business.
we just need news that we've got machines going and an announcement on a new cfo woould be nice too. Some one not necessarily with a crypto bckground, but hopefully someone that has been involved with metal type mining or oil drilling.
if you own one crypto mining company, this is the one because in reality, its an alternative energy company with a solid balance sheet, free cash flow, with a little bit of exposure to crypto which will add to the bottom line at low bitcoin prices due to them actually owning their facilities and having zero power costs
hopefully the news comes soon.