Comprehensive Valuation Report on Cipheras of August 31 2023A very interesting reading found in Issuer Bid Circular issued in September. You can find a Comprehensive valuation report on Cipher in the last 40 pages of the issuer bid circular made by Evans & Evans. The report is well done, and you'll find financial projections made the management team of CPH. The issuer bid circular is available on SEDARPLUS.CA.
https://www.sedarplus.ca/csa-party/viewInstance/resource.html?node=W828&drmKey=7b40abac4fbb0cd4&drr=ss2a1cdfd07de23501d7f893e133132024bd5039ea5f7966303f004552fc0246832c4cfb8c59165de4cae8c34882af7d66ux&id=0c11f8b7998bcd9690b04bf1df814a75ac15e9e9e43ac934 In a nutshell, the report's assumptions (all US$) are :
- Revenues will increase from 21 M$ in FY2023 to 56 M$ in FY2027, CAGR of 28%;
- Operating Profits will increase from 10 M$ in FY2023 to 34 M$ in FY2027, CAGR of 37%;
- MOB-015 will be a winner product, with a market share of 90%, 5 year after launch (82 M$ in addressable market);
- CF-105 will be launched after 2027;
- Net income will reach 37 M$ in FY2027;
- EBITDA will reach 38 M$ in 2027;
- Free cash flow will reach 39 M $ in FY2029;
- As a kicker, all these data are in US$;
So, of course these are financial projections made with a lot of uncertainty. You have to take and leave. However, at the end of day, they help us to understand the direction the management is going to. And it seems upward. A lot of these numbers are based on the success of MOB-015 however.
I believe if even 50% of these assumptions happen really, CPH will be a good investment in the next few years.
Does management really believe that a lot of shareholders will tender their shares with that kind of growth ?