Analyse van een Agoracom member:
The case for a much higher stock price. (Fundamental, Technical, Social analysis)
posted on Feb 16, 2021 01:11PM
The following are my own opinions and not a recommendation to buy or sell any security.
Do your own DD. Manage your own risk appropriately.
I've been putting together some analysis over the last few days looking at the stock from a fundamental, technical, and social analysis point of view.
I am normally a technical analysis trader and tend to ignore fundamentals unless I really study a company which is what I do with both PYR and HPQ. I only have so many cycles in a day and these are the only 2 companies I regularly spend several hours a day analyzing currently.
I read every press release, look at every model, and follow several chats on multiple sites for gauge sentiment.
I also, in the past, have failed big time to properly account for the amount of impact the social analysis has on a stock in this new market.
If I had only looked at technical analysis on these 2 companies I would have already sold at about $9.
But now factoring in all 3 forms of analysis, I am holding for a much higher stock price. ($30+)
Lets take a brief look at all 3 forms of analysis and discuss.
I welcome additional feedback and any corrections others may notice in the replies.
FUNDAMENTAL
In the recent week there have been several new Youtube videos that have popped up talking about PYR and I have watched most of them and virtually every single one only talks about how much the stock has gone up so far and how much farther it could go with a basic explanation of what the company does and why it may only be the beginning.
These videos fail misreably to really show the fundamental potential of the company but they do help get the word out and get more eyes on the company. To that end, they serve their purpose.
From a fundamental point of view the community here knows whats coming well and we know the potential opportunities in the pipeline.
Lets briefly discuss those, as well as some other fundamental metrics, and lay out few projections from a fundamental point of view only.
Some key fundamental points:
PYR has $0 debt
PYR has 159.15 mil shares outstanding fully diluted of which 76.95mil are owned by Peter and strategic entities. Most sites put the float at 51 mil shares of which most of it is owned by retail. Interactive Brokers shows virtually no institutional holdings yet. If institutions begin to list this in ETFs when the NASDAQ uplist happens, if they are passive etfs that buy to maintain weight, they will buy at any price to maintain that weight as money comes into the fund.
It is almost impossible to make a target for the stock price based on torch sales because there are just to many variables to consider. Selling price, margin, P/E multiple to apply, repeat sales over time, service contracts that go with the sale. But no matter how you crunch your own numbers, JUST looking at the conservative estimate for torch sales and no other business lines. It already justifies a higher SP than we are at currently in my own opinion. I believe margins are healthy on torches. We don't know exactly what they are and Peter SHOULD keep those secret as much as he can for shareholders benefit.
DROSRITE
HPQ Nano royalites
US Military service contracts
Purevap
Additive Manufacturing, 3D powders
They are flush with cash currently, reducing risk (not eliminating) of a raise and dilution
The CEO still owns roughly 50% of the company. (This was one of my initial reasons for investing in the company 2 years ago. I like companies with large CEO ownership. Just a personal preference)
The Normal Course Issuer Bid (NCIB) is active and PYR can buyback its own shares and cancel them, (like they did before, then reissue at a higher price, netting cash in hand) adding value to shareholders via float concentration.
Fundamental points mentioned by others in passing chats that I believe are worth also mentioning. (These are not my comments but I agree with them. Credit and thanks given to names mentioned.):
@MidtownGuy The patent moat makes it even harder, as it locks in monopoly, making margins an ever tighter secret for Peter to protect. I had speculated months ago that any large contract will just be announced as a bulk order number — with sales AND service $ bundled in — that does not allow anyone to decipher individual torch cost so as to maintain the torch margin secret
@PakG1 I understand everything you're saying. BUT I would add the caveat that this is the beginning of multiple sunrise industry plays. Not sunset plays. Myself, I'd rather stay until we hit afternoon at the very earliest. But I'm gonna be here for the whole 24 hour cycle. The growth potential is just that strong. It may finally become a sunset company when I'm on my deathbed.
@developbc Looking at the recent Rise Energy of Sweden 900kw PYR plasma torch sale last year which sold for little over $1M for the same industry and purpose - replacing fossil fuel burners in the iron ore pelletization process w PYR torches w roughly the same spec. It was a competive bid process in which PYR bid their price w profit built in NOT for charity! So let's say it was low margin of 10-20% based on a $1M contract order/torch. Even IF added costs to custom spec out for Client A and the second Client B were increased by 10-20%...deductive reasoning can conclude that $3M torch sale carries approx 67% net profit margin at base minimum.