A Very Likely $1.19 BMSN Fundamental Valuation…
Before I explain how ”logically” BMSN could ”Fundamentally” be worth trading in the $1.19 per share area, I think it fair to first understand some of the key variables that I will use to help me to derive this ”Fundamental Valuation” for BMSN.
Look within the Yahoo link below and you will see that BMSN trades within the Biotechnology Industry that exists within the Healthcare Sector:
http://finance.yahoo.com/q/pr?s=bmsn
Within the Biotechnology Industry, stocks that are fully reporting and file with the SEC have a Net Profit Margin % of 11.90% and a Price to Earnings (P/E) Ratio of 57.80 as indicated within the Yahoo Finance database as confirmed below: http://biz.yahoo.com/p/515conameu.html
Read the post below to fully understand the importance of the P/E Ratio: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57154170
Now consider below that it has been indicated that BMSN is seeking to enter into an $18 billion market for bone marrow stimulating growth factors as indicated below since beginning the development of its first clinical product (HemaXellerate™) which is a cellular drug designed to heal damaged bone marrow: http://www.prweb.com/releases/2012/10/prweb9972993.htm
The question now is… Do you believe that BMSN would be able to achieve at least 1% of that $18 Billion market if they obtain their FDA Letter? The answers is… Yes, no doubt! However, for the purposes of this valuation, I will remain conservative and figure that BMSN would only be able to achieve obtaining only 1% of that $18 Billion market so that investors could understand the magnitude of the true potential that would then exist in BMSN…
1% of $18,000,000,000 = $180,000,000 in Revenues
$180,000,000 x 11.90% Net Profit Margin = $21,420,000 in Net Profit/Income
Per the recent 8-K below, the BMSN Outstanding Shares (OS) is 1,035,911,549 shares: http://www.sec.gov/Archives/edgar/data/1079282/...003/biomatrix8k.htm
Now consider the formulas below to derive a “potential” ”Fundamental Valuation” for BMSN:
Net Profit/Income ÷ OS = Earnings Per Share (EPS) EPS x Price to Earnings (P/E) Ratio = Expected Price Per Share
So…
Net Profit/Income ÷ OS = Earnings Per Share (EPS) $21,420,000 Net Profit/Income ÷ 1,035,911,549 OS = .0206 Earnings Per Share (EPS)
EPS x Price to Earnings (P/E) Ratio = Expected Price Per Share .0206 EPS x 57.80 P/E Ratio = $1.19 per share
This means that given the above fundamental variables, the expected price per share could be justified to be trading within the $1.19 per share range for BMSN if BMSN is only able to capture only 1% of its $18 Billion market of which it exists.
If you believe that BMSN would capture still an amount far less than 1% of the $18 Billion market to let’s say maybe ”half” of the 1% of the $18 Billion market, then the expected price per share could be justified trading within the .59 per share range for BMSN.
On the contrary, if you believe that BMSN is going to capture far more than 1% of the $18 Billion market, then for every 1% that you believe it would obtain from the $18 Billion market… then you can ”fundamentally” add $1.19 per share for each 1% of expectation. Example below:
1% of $18 Billion Market = $1.19 per share for BMSN 2% of $18 Billion Market = $2.38 per share for BMSN 3% of $18 Billion Market = $3.57 per share for BMSN 4% of $18 Billion Market = $4.76 per share for BMSN 5% of $18 Billion Market = $5.95 per share for BMSN
And so on… and so on… etc.
With this valuation post, it is like any other valuation post that I have made in that it will not be up to what I post or say in order for these price levels to be achieved. It will be up to the company to deliver the ”substance” that we all here are expecting to be the stimulus for such to transpire. Here with BMSN, that primary substance that should act as the stimulus would be the FDA Letter. If BMSN delivers the FDA Letter to the public, then it is very possible that any of the valuations above by themselves or combined could happen.
Please, do not use or consider this post to be the gospel for where BMSN is going. Use it as a framework to have to understand where BMSN could very well go ”just-in-case” BMSN deliver the goods.
Before closing, there is something else very important to note… BMSN trades on the OTCQB. This means that they are fully reporting and file their financials with the SEC. This also means that they have ”audited” financials already acclimated with its existence.
BMSN SEC Filings: http://finance.yahoo.com/q/sec?s=BMSN+SEC+Filings
http://www.otcmarkets.com/stock/BMSN/company-info
http://www.otcmarkets.com/companies-advisors/otcqb
Bottom line, obtaining the FDA Letter is key, but of course it will also be important for BMSN to remain current and qualified on the OTCQB venture marketplace too. This means that BMSN is very legit and very transparent. The more investors learn of BMSN and its potential, the more significant growth that will be achieved for BMSN.
With BMSN, there are the following key things that investors are expecting to continue the move northward…
1**Filing of 10Q/K 2**Pending FDA IND Application News 3**Research & Safety Data News 4**Phase I & II Clinical Trial Update News 5**Merger News to bring even more valuation
BMSN Website: http://www.bmsn.us/
v/r Sterling |