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Bullboard - Stock Discussion Forum Great Lakes Graphite Inc GLKIF

Great Lakes Graphite Inc is an industrial minerals company focused on bringing carbon properties and products. It focuses on the manufacture, marketing, and sales of graphite products. Its product is categorized in types: graphite and advanced carbon products. Some of its natural flake graphite products are Micronized, High purity micronized, Ultra-high purity micronized, Spherical purified... see more

GREY:GLKIF - Post Discussion

Great Lakes Graphite Inc > Per share value analysis
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Post by GoingBroke on Jan 13, 2019 10:10pm

Per share value analysis

So the company project $30M in revenue, with the assumptions of 10% net profit margins which seems pretty conservative, they would have $3M in earnings. With 130M shares out,  and using again a conservative ratio P/E of 20x (way higher for company with higher growth, which is what I expect from GLK, but we’ll stay conservative) puts us up over $50M valuation. On a per share basis, that would bring us to a value of around 0,40c per share, and around 0,30c if fully diluted.

 

Now, we can play with the revenue and the net profit margins assumptions to make best case - worst case scenario, but at the end, 0,035 still looks pretty cheap at this point with the future revenue in play.

 

This is all without even having signed a supply agreement/sale contract. The numbers could get even bigger. For the people having concerns with their current debt, don’t forget it makes GLK a VERY GOOD acquisition target for a bigger company in the long term, they could make synergies by buying them but also profit of their tax loss.

 

That being said, there’s no reason why we should stay at the low level for long.

Comment by Newton1234 on Jan 14, 2019 1:00am
Thanks for reposting here, GoingBroke. As I mentioned on CEO.CA, I find SH hard to use. Especially on my mobile. Have computer handy now so will share link to post where I first described this model with round numbers, https://ceo.ca/glk?40183783d2fb As for 10% profit margin, I don't know. It might be less! At some point it becomes too low, like 5% net income surely isn't enough for ...more