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MiMedx Group, Inc. Message Board

  • docsurick docsurick Mar 26, 2014 6:43 PM Flag

    Mdxg valuation

    Mdxg finished today priced about 6 x 2014 revenues. This is low considering the growth rate. There are a couple short term issues and once resolved and toward September we will be looking at 2015 revenues. 150 mil is a low number and 7 x 150m gives us about 12 per share. Rest assured this stock will bring 10x forward revenues in a buyout. I believe MDXG has suitors now, but revenues need to hit 100m and it will get interesting.

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    • If it's consolation, pull up 1 month chart of biib and it looks exactly like mdxg. Biotech still being taken out behind the shed and shot. They have to at some point run out of bullets And the survivors will come crawling or running back, in the mean time, I sure miss our boring up 2 percent days that we used to have for months at a time:)). This too shall pass.

    • Yesterday's Craig-Hallum analysis presented their discounted cash model for how they arrived at $10 per share. Actually, their analysis generated a discounted price of $10.33. Of course the analysis uses lots of assumptions regarding sales, margins, etc. but all and all I thought the $10 was achieved conservatively. Ultimately, a company's ability to generate cash determines its value and MDXG will generate a lot of cash one day. Unless multiples of sales some how is related to prospective cash flows, I don't believe that's a very reliable way to determine current value. A $ of MDXG sales with 84% gross profit is going to be worth a lot more than some other biotech with a lower gross profit.

    • doc, I appreciate your history and perspective on the company, but I'd like to flesh out some of the numbers so we're all on the same page. I see 105 million shares outstanding currently. In addition, there are 15.4 million options granted with exercise prices from 65 cents to 6.60 per share, with 11 million of them exercisable at less than $3. There are another 1.3 million warrants with a strike price of 90 cents.

      Not all these options are vested at present, but I expect that in a change of control transaction, they would be included. It's true, another 16.7 million shares via options and warrants would bring in an additional $35 million or so, but my main point is that we should be working off of 122 million shares fully diluted. Now use whatever buyout value you like!!

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