RE:MOU'sIn my opinion, your estimates are very optimistic, but given where we are now, your estimates are just as good as mine.
I'd say average sales price of $4 max (my range of estimates that I used to calculate future cash flows is $2.50 to $3.50):
-max $10 to customer, less sales tax & pot tax for which I am using an estimate of 10%; therefore the retails will have a selling price of max $8
-companies like LCBO have a gross margin above 50%
WIth so many competitors out there, I don't think they will have 25% of the market (or if they do have 25% of the market, their selling price will be much lower than $4).
Tobacco companies in Canada operate at a 55%-60% of capacity, so higher production capacity wouldn't necessarly translate into for revenues.
I'm very comfortable with my puts.