Superb Investment on Growth, Disruption and EarningsThis is a great investment in a superb niche which sells in USD but operates in C$.
Its financil performance is one of ever increasing sales and profitability.
The 12 month trailing indices are ( March 31 ) ....
2013.....$20.5 m in sales Ebitda = $2.6 m, EPS = 2.5 cents
2014....$22.6 m in sales Ebitda = $3.2 m , EPS 2.5 cents
2015....$26.1 m in sales, Ebitda = $3.7 million EPS = 4 cents
2016.....$29.1 m in sales Ebitda $5.2 million EPS = 8 cents.
However, financial perfs are rapidly increasing and BVO have added 8 acres which will be producable starting in Sept.
The past 4 quarters shows that BVO is rapidly increasing its financial perfs..
Q4/15............$11 million in sales, gross margin 25 %, Ebit $1.8 million, EPS 3 cents
Q1/16 ...........$4.5 m in sales, GM = 25 %, Ebit $0.5 milion, EPS -.5 cent
Q2/16.............$6.8 million in sales GM = 32 %, Ebit $1.14 million EPS 1.5 cents
Q3/16............$6.8 million in sales GM = 37 %, Ebit $1.85 million EPS 4 cents
You will note the strong seasonal pattern, with Q4 being the strongest quarter and Q1 the weakest.
Growth has averaged about 20 % for F2016 versus F2015. In Q3, growth was 38 % higher than Q3 of F2015.
I shall use 20 % for Q4 of fiscal 2016 ( April May June 2016 ) and will conservatively assume that GM remains at 37 % for Q4.
Q4 sales are forecast to be about $13 million, operating earnings will be $ 4.5 million , Ebitda at $4 million and EPS at 10-11 cents per share.
This will put F2016 net earnings at about 15 cents per share and F2016 Ebitda at $7.5 million or about $0.30 per share.
As becomes obvious, BVO is very undervalued, with a current fair value above $1.50 on its reasonably certain F2016 net earnings and much higher on its sparkling Ebitda.
Looking forward to F2017 ( July 2016 to Aug 2017 ), with additional acreage , EPS should rise to over $0.20 per share.
Cubic Farms will add to this, but I have yet to scope out its potential..