RE:RE:how many times do i have to say thisThis is a overbloated stock still.
Yes, the CAP has dropped due the obvious SP drop, but i think in the market they play in, there are now WAY too much competitors that you're fighting.
If they continue to grow their sales every year, then yes, this can be a great stock to hold long, but i agree with you, this will still need to drop and get to a much lower S/P ratio.
by the way, it was at one point in those 70-80x range. it has dropped low enough that its at your 28x calculation.
Still, this isnt amazon, its a food brand. It either continue to get momemtum, or starts to die out like other brands.
as i have said many times, i like the way the company has been expanding and their long term vision of growth, but, the price is out to lunch. it needs to come down.
I pray it drops to $0.5 :DDDD. ill dump 50K into the company no problem.
PhDtrader wrote: Today, at $3.16 the market cap is $300 million (not $500 million). Their Q1 2021 earnings were 2.63 million x 4 = $10.56 million. That makes for more like a 28x earnings to market cap ratio, (not 80x - reality check, Kia).
The Q1 2021 earnings represented an increase of 46% over the previous quarter. A key question is do you think that type of earnings increase can be be expected to continue? If yes, the Q2 2021 earnings would be around $3.84 million. In that case, and the sp stayed at $3.16, the earnings to market cap picture in Sept would be around 20x.
However, I expect the earnings to increase by more than 46%. After all, the 46% increase up to March 2021 was before the Vancouver Facility came online. Revenue was constrained by supply.
If demand gobble up the growth in supply from Vancouver (originally they quoted a 17x increase in production capacity, but now we expect somewhat less because they increased their Victoria production by about 50%) a 75% Q to Q increase seems possible, doesn't it? That would put VERY at a 15x ratio.
I admit that 15x is still a bit high (and indeed specualtive), but waiting for a sp of $.50 is asking for a ratio of around 2x or 3x. I know I've been wrong before, but do you think that with very executing as well as it does, you will be able to get in at that?
I'm considering to start re-building a position at 2.85, then getting well in either at 2.50. Or, if earnings in Sept crushes my 75% expectation, I would happily buy more at $3.