TRANSGAMING INC. V.TNG

Stock Market Logic

[dpoc]

Here's an interesting comparative analysis of two publicly traded companies in Canada. My numbers are from TD Webbroker. Take Transgaming TNG to start. Market Cap is $13.3M with a revenue of $10.2M and 116.0M shares outstanding. The Beta is 0.53 with a $0.02 EPS. The Book Value is $0.02, P/E is 5.0x, Price/Sales (TTM) is 1.3, P/Cash Flow (TTM) is 3.7x and Operating Profit 7.13%.
Now take a look at ProMetic Life PLI out of Quebec. Market Cap is $678.3M with revenue of $21.9M and 529.9M shares outstanding. The Beta is 2.82 with an EPS of $-0.04, Book Value is $0.04. Price to Sales(TTM) is 30.9 and Operating Margin is -66.15%.
ProMetic Life has twice the revenue of Transgaming, yet 5 times the market cap, and of course the number of shares outstanding.
The difference in value seems to depend on market perception. Interesting!
GLTA

[dpoc]

One typo error on my previous post should have read, 'ProMetic Life has twice the revenue of Transgaming, and 50 times the market cap given the difference in share price and number of shares outstanding.' Apologies are in order.

[vulturecapital]

The difference lies completely in expectations for the future of both companies. There are very serious doubts amoung investors that Tng will be able to execute on its grand plans. The market is no longer buying Gupta's fairy tales about higher revenues and pivots; to say nothing of his outright public deceptions when it comes to strategies like game publishing.

[dpoc]

Couldn't have said it better myself. Right on vulturecapital!