company's valuation Been taking a look at RLH and have a few questions/concerns about the valuation of this company and why people are so bullish, would love your input:
Pros
- strong management team with experience in emerging markets and political lobbying
- facility to grow and harvest already setup and ready to produce/harvest in coming months
- strong branding/marketing by the CEO
- cash in hand for a decent amount of runway without too much dilution so far
Cons:
- limited available markets - Netherlands' total legal truffles sales estimagted around 30 million a year - even if they capture 10% of the market share in the next few years we're looking at about 3 million dollars in revenue total y/y
- As of yet unknown number of harvests in a year - can be anywhere between 2-4 weeks, so between 12-26 harvests a year, with an estimated volume of 100,000 grams per harvest = $150k /harvest in revenue, so max revenue here is roughly 3.9 million dollars (if assuming product is going to be priced at 15 euros) if all goes according to plan or as little as 1.8 million, with no real understanding of profitability
- expansion will be very limited in the legal space until change in gov opinions
What justfiies a 16.5 million dollar market cap, let alone double or triple that? Am I missing something here? Or is it largely based on speculation and the hopes that more markets open up? what will set them up for more success than existing growers and distributors in the netherlands which are not all above board?