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CI First Asset U.S. Tactical Sector Allocation Index ETF T.FUT



TSX:FUT - Post by User

Post by jharbaughon Nov 28, 2011 8:32pm
312 Views
Post# 19272893

FUT vs PTS

FUT vs PTSNot only is PTS a business partner, they are a great mirror into the future. Based on their latest financials, it looks like they'll get around $110M revenue and make about $20-25M in net income this year. Their market cap is $135M and they had a 10 for 1 reverse split to accommodate US listing requirements.

But have a look at their financials back in 2004, the first year the stock was listed on the market.

https://www.sedar.com/DisplayCompanyDocuments.do?lang=EN&issuerNo=00011685


Referring to the full year 2004 financials released March 23, 2005, the company was an absolute mess. $9M in negative equity. Meaning their liabilities exceeded their assets by that amount. Their loss was $8.8M on $7.6M in revenues. Their accumulated deficit was $35M.

Even still they has a stock price of about $1-$1.50 during the year based on 22.7M shares. Well above Futura's current market cap.

2007 was the height of their market cap, topping $4. Their share balance was up to 120M shares for a market cap of nearly $500M.

If we look at their financials released March 28, 2008, they raked in $31M revenues but still lost $3M in net income. It was only after this that they turned it around and started making cash to where they are today.

But this history less shows that their market cap was way higher than Futura's. Their negative equity was much higher, their losses much bigger and their gross margins much smaller. And the end result is that they still are a $135M market cap company with nothing but positives on their financials 6-7 years later.

We all must have patience on Futura. If PTS can turn it around, FUT definitely can. And if the market and economy gets hot again, FUT could easily have a $500M market cap 3-4 years down the road. $30M in yearly revenue is not out of reach by then. And I'm sure they'll be raking in profits, not losses by then. 128 dealers is their breakeven point.

Futura is an incredibly lean company when compared to PTS back in 2004.
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