Pro-forma Napkin Math
Mason,
I know that you've been there and done that but I still like to project the pro-forma eps using napkin math after an acquisition. So here goes nothing!
Assumption - Until the SEC 8-K is filed by Immucor it appears as though the acquisition will be accretive to earnings. Financing details are currently unavailable. There is no dilution as the deal is a cash tender offer. Gamma will contribute similar earnings as previously reported over the last two years.
Gamma Net Income Average - $1,200,000
Immucor Basic Outstanding Shares - 8,111,300
EPS Increase - $1,200,000/8,111,300 = $0.15
Immucor TTM EPS - $0.25
Gamma Accretive EPS - $0.15
TOTAL Pro-forma EPS - $0.40
Share Price Valuation
$0.40eps x 35pe = $14.00
Note - This exercise does not take into account the possibility of improved net earnings through the consolidation of redundant departments, increased ReACT sales, Gamma Technology deployment, etc.
Go Immucor!
Tom |
