VALENCE TECHNOLOGY (VLNC) Message Board

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Technology Stocks : VALENCE TECHNOLOGY (VLNC)

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To: Zeev Hed who wrote (11438)	5/26/1999 5:50:00 PM
From: Eli74	Read Replies (1) of 27311

With all due respect, Zeev, I think you're missing the boat. From my perspective (and I'll be the first to admit I tend to have a somewhat simplistic view of things), the whole argument about earnings dilution is "full of sound and fury, signifying nothing." Even assume that VLNC issues the full $50 million registration in common stock. At $7/share, that would equate to approximately 7 million shares. If my memory serves me correctly, 7 million shares would amount to 25% dilution (approximately). Assuming the bulls are correct, and revenues on VLNC reach $1 billion in 3 years. Assuming a 30% after-tax return, that revenue figure would result in $300 million net income. This net income figure generates EPS 3 years out of approximately $8.5/share. At a P/E of 20, the potential price equates to $170/share. I can live with that, can't you? Love & Kisses

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