RE:Aphria is Severely Undervalued-Regardless of Media CoverageIn his calculation, he use 4-5 dollar as a wholesale, which is reasonable. Once fully operational, the cost would be sub 1 with phase 4 automation. So estimation is not far off.
MoneyManager313 wrote: Spoke to my team regarding Aphria's SP. Here's what we've determined.
1.) Production by Jaunary 2019 is set at 220,000 Kg. Thats 1000 g x 220,000 kg = 220,000,000 grams of Dried Flower. Now, Aphria is producing Sub 1.00$ per gram, but selling at an average price per gram of 8.20$. So 1.8 Billion$ in Sales from production and $200 million to produce the product. That equates to a profit margin of 1.6 Billion$ per year. Aphria has partners. Partners who are in demand of their product. Partners such as Tetra Bio Pharma, Life brands, Althea etc... These cannabis distributors rely solely on Aphria for their products. Aphria currently is having problems meeting the demands of their partners and are cutting back on shipments because it's more profitable to sell their own product rather than sell at wholesale to its partners. Do we believe Aphria will generate 1.8$ billion in sales by 2019, yes and no. We believe they will have no problems selling thier product but at alower margin. We predict 220,000 kg will be sold but at a avergae cost per gram of 4-5$ equating to approx $1 Billion in Revenue and a profit of $350 million in 2019. We expect PE to be 18.5 x (averaged). To sum it up, We see Aphria Grossly undervalued with legalization on deck. We expect the Share Price to reflect the December 2019 production with legalization at $110 per share / $ 5.88 EPS - P/E of 18.70
YES WE EXPECT the Share Price in 2019 for Aphria to be 110$ per share.
Where do we see the SP by December 2018? 40 $ per Share. Taking into consideration of legalization.