PTQ - Fair Value $1.80 to $2.00 The following analysis indicates a fair share price of $1.80 to $2.00 for PTQ operations in Panama only.
The entire financial and stock market industry agrees that the best way of measuring the true value of a stock including PTQ is the Price earnings ratio (PER). This ratio is used to determine whether PTQ is overpriced or under priced when you buy it.
Price Earnings Ratio (PER) = Price of Stock divided by one year earnings per share (EPS) of the company.
So a PE Ratio of 12 means you’re paying twelve times the earnings of the stock and so it will take you 12 years to make your money back and be in profit. To provide meaning to the Price Earning Ratio Professor Robert Shiller of Yale University reconstructed the S&P 500 back to the 1880’s which is over one hundred years of data. The following is based on his work.
PE Ratio under 10 – Stock price is Under Valued
PE Ratio 10 to 15 – Stock price has a Fair Value;
PE Ratio 15 to 18 – Stock price is Over Valued
PE Ratio over 18 – Stock price is in a Bubble
So using the above PE Ratio information lets estimate and project what the PTQ fair value stock price is for a PE Ratio 10 to 15.
Estimating PTQ Fair Value Per Share
PTQ – From Financial Statements Trailing Four (4) Quarters Earning Per Share (EPS):
Feb/2012: .02
Nov/2011: .03
Aug /2011: .03
May/2011: .04
Total EPS: .12 Cents/Share
Price Earnings Ratio (PER) Fair Value: 10 to 15
So Low Fair Value: 10 X .12 = $1.20
High Fair Value: 15 X .12 = $1.80
My opinion is that the fair value for the Panama operations would be around the $2:00 because we have to take future earnings and the increase in the gold price into consideration. Also let us compare the La Mancha (LMA) deal to PTQ.
Note: La Mancha (LMA - TSX) sold for $3.50 with 12 month trailing earning of .23 cents So that is a 15.21 Price Earnings Ratio (PER).
So: PTQ - Fair Value Using the 15.21 PER = 15.21 X .12 = $1.82
In my opinion and based on my analysis a fair value would be in the $1.8 to $2.00 range. So .48 cents is WAY TOO LOW. PERIOD. THE END.
GLTA Hold Long and Prosper