Very Good Food Company Inc VGFCQ

RE:Valuation?

[Toppicks1]

Allthewaydown wrote: Company is currently producing as fast as it can, so maxed out on sales @400K per month. Not sure what the added capacity is from Vancouver facility, but based on square feet maybe adds 3x current production? That puts you to 1.6M per month, or 19.2M per year. Give it a (generous) price to sales of 2, and market cap should be about 38M, or about $0.48/share for 80M shares. This valuation INCLUDES successful ramp up of production by a factor of 4 this year. What that means to me is that the thing is at the moment trading 3x its near-term intrinsic value due to blue sky potential alone. Looks like a good company, good business plan, lots of energy, but it is running quite a bit ahead of itself on share price by my calculations. Does not mean that it won't run higher, but it seems that until the end of this year and successful ramp up of Vancouver it's more downside risk than upside potential. I'm figuring it's a good buy at $0.50, a fair gamble at a buck or less, but a bit pricey at current $$. In my mind it's always a good idea to figure out what "fair price" looks like before getting too carried away with momentum. 

Most stocks trade at 10- 15 times earnings so at 48 cents a share that would be 4.80 or at 15 times earnings it would be 6.20 not sure you know anything about trading.