GRB fair value Let’s look at this if someone was going to acquire GRB
Market cap 36.91M US
Outstanding shares 26.92M
OS X current market price of 1.37 = 36.88M US
36.91 + 36.88 = 73.79M US
Sage ~ 1.6M square feet in homes to build across 995 homes (1675 average)
Jeff said $130 per square foot in construction costs.
1.6M x $150 = 208M costs (project level financing)
Jeff also said $100 per square foot cost to buyers (GRB profit) for the land. Jeff bought that land for 1M so this is all profit and why he made his 101 post about “entitlement” being the biggest wealth creator.
1.6M square feet x 100 = 160M US
Let’s assume 50/50 split between captiva and grb so that’s 80M profit for GRB.
Jeff also said that construction profit is normally 15-20%.
Using 20% and taking 50% to represent captiva that equals 208M x .20/2 = 20M
20M additional profit for grb on top of the 80M profit.
But let’s be ultra conservative and say grb makes nothing off construction.
The profit 80M is still worth more than GRB if Jeff sold the entire company at current price 73.79M
Let’s take Alberta… previous press release indicates 12M cash flow after first set of projects completed. But let’s be ultra ultra conservative and not even include Alberta
We are still left with Montalva for free since Sage is worth as much or more than GRB at current market price buy out.
Montalva is with at least 30M. It’s on if but when it’s approved.
30M is more than 600% return if cash flow is 180M. 30M is super conservative.
So if we take our 30M and divided by buy out price 73.79M we get 40 cents per share.
That means the lowest share price for grb (buy out + Montalva) should be current price + .40 cents = 1.7 + .40 = $2.1
You are literally losing money if you sell for less than 2.10 per share.
That doesn’t include Alberta or real estate acquisition.
On the real estate acquisition… I don’t know if it’s even legal for Jeff to buy shares as long as he is negotiating for Paul’s company.
Wouldn’t that be insider trading?
So..I think we will see Jeff drop the news on the real estate company and then buy his 1M shares and when it’s all said and done the SP will be a lot higher than 2.10
Hold your shares tightly and have patience.
In terms of when grb will see Sage revenues…Jeff said before that project level financing you get full value when the shovel hits the ground as the bank guarantees the loan. The only way GRB couldn’t make the 80M profit is if the homes don’t sell. Let’s be serious here… those homes are going to sell.
Jeff - feel free to call me out if anything is out of line here or totally inaccurate.