VCR ventracor limited

vcr - summary of rock steady

  1. 423 Posts.
    VCR Valuation Methods


    - trials are successful
    - approval is granted in Europe, Japan and U.S
    - marketing is successful and
    - Gov't reimbursement is available
    - Most published research figures are simply projections and always disagree on total numbers etc making any sort of accuracy difficult.
    - assume published figures are correct though for this exercise.
    - made no allowances for the other uses VentrAssist will be used for and that VCR have planned.

    Valuation Method 1

    Number of CHF sufferers who are potential recipients 11,000,000
    number of who will become LVAS recipients 1,000,000
    $ of Market 11Billion
    Cost of VentrAssist device About $50,000
    VCR % share of market 10% - so 110,000 unit sales for VCR
    Profit as % of sales Net 30%
    Time to sales 3-4 years …revenue expected by end of 2004
    P/E 38
    Shares on issue by 2010 220M


    110,000 units being sold for 7 years @ price $30,000 per unit so $3,300,000,000 in sales.
    From this our Net Profit could be $990,000,000.

    220 Million shares on issue by 2010

    $990,000,000 against the 220,000,000 shares on issue gives us an EPS of $4.50
    If, in 2010, VCR are doing well, they will be recognised world wide, growing strongly and be listed on a U.S. exchange and it may possibly be conservative to give them a P/E of 38
    So finally, EPS of $4.50 with a P/E of 38 gives us a possible shareprice in 2010 of $171.00.
    Valuation method 2

    VCR can obtain 10% of total market share by 2008

    An available LVAS market value of AUD$11,000,000,000 in 2008.

    presume VCR can achieve 10% of this, their share will represent $1,100,000,000

    sale price of $30,000 into the equation, we arrive at a result of 36,666 unit sales.

    Multiplying our unit sales by our profit per unit of 30% (representing net profit margin), or more correctly $9000.00 we achieve a net profit of $329,994,000.

    Presuming 220 million shares on issue by 2008, results in $1.50 earnings per share.

    $1.50 with a P/E of 38 (Scotts) results in a shareprice projection or estimate, of $57.00.
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