More on CCCX's pie-in-the-sky revenue & earnings projections.
I've already mentioned how Roger Neal has the company saying that CCCX will somehow grow the topline of by roughly 8000% by doing more advertising and promotion.
On top of that, he also has them saying they will have a net margin, after tax, of a whopping 31%.
For comparison, RXSD, which is the industry-leading vitamin maker and an MLM operator too, has a net margin of only 9% on its sales of about $600 M per year.
Part of smoke and mirrors with the net margin is acheived by using a preposterous SG&A of only of 3% of revenue. This is preposterous. For comparison, RXSD spends 37% of revenue of SG&A. Obviously CCCX cannot increase its advertising and promotion without driving up this affecting SG&A, is
So, starting at the topline with a ridiculously inflated revenue projection, and moving to the bottom line by multiplying by a ridiculous net margin, the company arrives at a doubly ridiculous net earnings projection of $0.71 eps.
If you play this game, and apply RXSD's p/e multiple of 26 to the stock, you get a target stock price of 18, as compared to the present stock price of 3.
I'd say 3 cents would be generous for this stock. |
