Wednesday, June 17, 2020

The Value Question: Part 1 -- Interactive Display.

I have stuff to do so I need to break this one up.

If MicroVision is for sale, it's a pretty good idea for the shareholders to get an idea of what it's worth. (This is all MY opinion, and I'm not making any recommendations.)

Interactive Display:

This was DELAYED, not destroyed.

From the November 6 Conference Call:

"Our activities related to our Interactive Display solutions resulted in a major step forward during the past few months as customer due diligence work has now led to negotiations for component purchase agreement that we aim to complete this quarter fora targeted launch of our interactive display module in 2020. As customer products come to market, we expect our company revenues could reach $100 million over a 12-month period, following product launches that we expect to start in the second half of 2020"
I have my reasons for believing that this customer is AMAZON. ($AMZN)
The Value question:

Company sale criteria (5x IBITDA)  If it's the only income and is expected to continue at this rate, then this vertical would be worth $500,000,000 (or $3.75/Share)

Or.....

100 million per year / # shares * PE ratio

100,000,000 / 140,000,000 = $0.71/share in earnings. (Yes, I know there are expenses that will have an effect.)

PE 20 (20*.71) = $14.20/share
PE 30 (30*.71) = $21.30/share

We don't need to take that higher.... whatever the case I think for this vertical the range is huge... something possibly less than $3.75 to somewhere north of $21.

Where it ends up, depends on the anticipated size of the market.

Given the amazing potential of "The Internet of Things" this could be significantly bigger than many of us believe. (I doubt it will be smaller.) My own theory is that everything that uses a powerful computer benefits from its own screen. (Doom on Thermostat)

The company knows a LOT more than I do.

Remember this is for one vertical, and probably the smallest one.

Barring significant interruptions, I'll be working through the rest of the verticals this week.
Hat tip to KYinvestor.
 


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