mechanics of PTK @ $45/share (w/o additional v2.0 markets)re-posting here, for the benefit of those who haven't yet moved to The Other Forum. if someone can
legitimately (ie, not Baggie dufus) blow holes in my math, please do so. [with appropriate supporting logical alternatives, obviously]
it seems reasonable to me.
(e.g., Rick, evil, ... I guess I'm looking at you...)
GLTA,
R.
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[insert obligatory "this is only my opinion" statement here]
this is still just using the Pelligrino v1.0 model (which some say is too conservative), but updated to the new share count f/d.
interesting that pure P/E corroborates.
$47.16 or $44.70, take your pick.
enjoy,
R.
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Method A. Using forward P/E
Consider this alternative, using last night's close of 83c.
At 83c, PTK currently has its forward P/E at about 0.2785
NPV of net EPS/a is about $2.98/share/year … $12Bnpv/19y/212MMshares = $2.98eps/yr
The average US P/E for the last ~120 years has been around 15 (or an earnings yield of ~6.6%)
Using P/E, PTK is right now, today, comparatively 54x undervalued, should it be allowed to reach its potential. (15/0.2785 = ~53.86)
53.86 * 83c = $44.70/share
There it is.
Method B. Using the Pelligrino model's framework.
To sum up P1.0 ... Military: $50MM initial fee for each licensed agency, plus each flat-rate $250,000 monthly. Commercial: $20MM initial fee for each licensed manufacturer, plus 8.17% of each unit sold.
Laying this out onto a spreadsheet, results in an understanding that POET should achieve $145 Billion in revenues over the patents' lifetime, not including the markets that Pelligrino 1.0 left aside.
That's average at $7.5B/yr, or a measly 2.5% of the annual semiconductor market (using $300B/yr).
Result: $144B Commercial CPU/etc. Market, plus $944MM Defense, less $4.5B sub-royalties to UConn (using the 3% model) ... leaves $140.5B gross.
Call it $85B after tax (40% tax? too high; it's Canada), reserve $5B for crafty on-our-side patent-protection lawyers. (repeat: Five Billion Dollars for Lawyers!) and figure they'll burn another $5B on general costs.
Leaves $75B free and clear. Take that ~$75B net-net over 19 years, give it a generous 25% discount rate.
What's that worth Today?
Present Value of Expected Cash flows: $19,943,896,610; Net Present Value:$14,943,896,610. Lose 2-3%/yr for inflation (call it $400MM/a).
You're still left with net present value of PTK at $8-12 Billion, or $47.16/share using the median NPV $10B (which curiously enough is also Taylor's number).
If they all just chicken out and sell it (for a-thermostat-and-a-half) -- at just $5B, right now, today, this instant ($23.58/share)?
It would still be a half-price sale.
GLTA,
R.