GUMM - Eliminate the Common Cold Message Board

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Biotech / Medical : GUMM - Eliminate the Common Cold

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To: DanZ who wrote (4768)	10/28/2003 11:20:57 AM
From: StockDung	of 5582

DAN ZIMMERMANN BASELESS' "$100 within the next 12 to 18 months" PRICE PROJECTIONS "Here's my prediction. GUMM will trade at $100 within the next 12 to 18 months on a split adjusted basis and the market will give them a PE in the range of 30 to 40 due to their rapid growth. If you don't think this is attainable, then I think you have underestimated Gumtech's target markets and management's abilities." ---------------------------------------------- Stock Price Projections To: CCCrawford who wrote (1215) From: Dan Zimmermann Wednesday, Oct 27 1999 9:24PM ET Reply # of 1385 CC, Here's a simple answer to your question. At a PE of 20, Gumtech has to earn $5 per share to equate to a $100 stock price. They have 7.5 million shares outstanding, so they would only have to earn $37.5 million to justify a $100 stock price at a PE of 20. If the market gives them a PE multiple of 30, they only have to earn $25 million to justify a $100 stock price. Let's assume that they have to issue more stock to fund that much growth, so they have 10 million shares outstanding. They would have to earn $50 million to justify a $100 stock price at a PE of 20. The company is targeting two large markets with what I believe are outstanding products. The market for OTC cold remedies was $2.5 billion in 1998. The market for smoking cessation products is valued at $450 million this year and is projected to grow to $1.5 billion by 2007. The market for tobacco products in the US alone was $46 billion in 1998. The long term future for Gumtech is pharmaceutical drugs delivered through chewing gum. Now ask yourself, how hard will it be for them to earn even only $37.5 million or $50 million in 2001? Here's my prediction. GUMM will trade at $100 within the next 12 to 18 months on a split adjusted basis and the market will give them a PE in the range of 30 to 40 due to their rapid growth. If you don't think this is attainable, then I think you have underestimated Gumtech's target markets and management's abilities. Luck. Dan

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