AEI 0.96% 51.5¢ aeris environmental ltd

AEI Valuation Discussion, page-2

  1. 435 Posts.
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    (Repost from another thread)

    I think AEI should be trading at at least 80c today.

    Here are my assumptions:
    * $3m revenue per month (conservative, given April was $4m)
    * gross margin of 50%
    * annual fixed costs of $7m.

    that generates the following:
    * $36m annual revenue
    * $18m gross profit
    * $11m net profit (before tax, etc)

    at a PE ratio of 20x, enterprise value would be $220m ($0.92/share)

    add the value of $14m held cash to get $234m market cap (about $1.00/share).

    I would conservatively discount that 20% due to market uncertainty in general, to get $0.80 per share.

    obviously these are back-of-the-envelope calculations, so I would welcome any well-researched challenges to my assumptions and valuation process.

    obviously DYOR. I’m not a financial adviser.
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