RE:$55.95 share target Free50dom...
Myself personally, I like to use a price to sales ratio. With such an aggresive company, I dont believe we are going to see their "true" earnings for a couple years. They are still spending boatloads of $ around the globe, as they should be.
First year of rec may only be approx 500,000kgs of cannabis consumed in Canada. We have to remember, we are slowly taking over the black market. It wont come over night. By year 3, we should be able to capture 90% of the black market. And with that, will also come more users then before, as it has been normalized and acceptable, as well as having more products to choose from such as beveridges and concentrates. Our first year, we will only see dried flower.
Year 1, my expectation, is that canopy captures 30% market share of 500,000kgs. That will be a total of approx 175,000kgs.
175,000 kgs @ $5.50 gram = $900,000,000
Year 2. 300,000kgs @ $5 = $1.5 Billion in revs
16 Billion Dollar Market / 1.5 billion in revs = P/S 10.6
$80 (Stock Price) * 200 million shares = $16 Billion Dollar Market Cap Therefore in year 2, I am saying Canopy will sell 300,000 kgs @ $5 a gram for revenue of 1.5 Billion. With a P/S ratio of 10, that would support a stoclk price @ $80 per share. We should be trading at a much higher P/S ratio however, because of the extreme growth thats coming our way in Germany, Europe, and the rest of the globe.
Tim M..... you agree with this?
Free50dom wrote: So if Canopy depletes most of its 250,000kgs in inventory right now to fill the provincial stores, what does that give us for a shareprice at P/E of 15x?
250,000,000 grams at $3.00/gram profit = $750M
201M outstanding WEED shares currently = $3.73 profit/share
P/E = 15x
therefore: P = 15 x 3.73
Price = $55.95/share
Don’t attack me, correct me instead. I just calculated that on the back of my pizza box .