Maurice,
Those are the questions that are on everybody's mind.
Let's do some math.
I don't remember exact numbers, so please correct if I am wrong. Also, I will try to be conservative, but fill free to knock down any number if you think it is too optimistic.
1. I believe that there are 70 mln households in the US.
70*0.27=18.9 mln
Let's assume that only a half of them - 9.45 mln will do Internet banking.
2. Other assumptions:
-only 1/3 of them (3.15 mln) will go thru CF;
-CF will charge $0.20 per bill;
-every household pays 10 bills a month (120 bills a year);
I included mortgage/rent, one insurance, one credit card, one phone line, electric, gas/oil, water, paper, cable, ISP.;
-there are 55 mln CF shares around;
(3.15*0.20*120)/55=$1.37/share will add to the bottom line of the company. It already broke even, has no debt, so $1.37 will immediately affect stock price.
With P/E=30, I don't think it's unreasonable a year from now, we arriving at stock price $40.
Please note, I didn't count businesses with their dozens and hundreds daily payments, ACH, etc. Just households that ripe for ebanking and are waiting for banks.
After City stepped in, banks can't afford to wait on side lines for to long. These days not too much customers' loyalty left.
This is just my 2c. Any opinions on my estimates? |
