for those without search-button capability.
[insert obligatory "this is only my opinion" statement here]
this is still just using the Pelligrino v1.0 model (which some say is too conservative), but updated to the new share count f/d.
interesting that pure P/E corroborates.
$47.16 or $44.70, take your pick.
enjoy,
R.
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Method A. Using forward P/E
Consider this alternative, using last night's close of 83c.
At 83c, PTK currently has its forward P/E at about 0.2785
NPV of net EPS/a is about $2.98/share/year … $12Bnpv/19y/212MMshares = $2.98eps/yr
The average US P/E for the last ~120 years has been around 15 (or an earnings yield of ~6.6%)
Using P/E, PTK is right now, today, comparatively 54x undervalued, should it be allowed to reach its potential. (15/0.2785 = ~53.86)
53.86 * 83c = $44.70/share
There it is.
Method B. Using the Pelligrino model's framework.
To sum up P1.0 ... Military: $50MM initial fee for each licensed agency, plus each flat-rate $250,000 monthly. Commercial: $20MM initial fee for each licensed manufacturer, plus 8.17% of each unit sold.
Laying this out onto a spreadsheet, results in an understanding that POET should achieve $145 Billion in revenues over the patents' lifetime, not including the markets that Pelligrino 1.0 left aside.
That's average at $7.5B/yr, or a measly 2.5% of the annual semiconductor market (using $300B/yr).
Result: $144B Commercial CPU/etc. Market, plus $944MM Defense, less $4.5B sub-royalties to UConn (using the 3% model) ... leaves $140.5B gross.
Call it $85B after tax (40% tax? too high; it's Canada), reserve $5B for crafty on-our-side patent-protection lawyers. (repeat: Five Billion Dollars for Lawyers!) and figure they'll burn another $5B on general costs.
Leaves $75B free and clear. Take that ~$75B net-net over 19 years, give it a generous 25% discount rate.
What's that worth Today?
Present Value of Expected Cash flows: $19,943,896,610; Net Present Value:$14,943,896,610. Lose 2-3%/yr for inflation (call it $400MM/a).
You're still left with net present value of PTK at $8-12 Billion, or $47.16/share using the median NPV $10B (which curiously enough is also Taylor's number).
If they all just chicken out and sell it (for a-thermostat-and-a-half) -- at just $5B, right now, today, this instant ($23.58/share)?
It would still be a half-price sale.
GLTA,
R.
