My valuation of RVP yield a fair value of $2 (after doing some more work)
Given my research on Shaw, I think he will not sell company as this job keeps him busy and he is the boss and he already has money. Will he settle, probably not as he wants the full money and given the verdict he has a reasonable shot.
Shaw has failed miserably to be a successful company and he probably will fail in future too. So, I thnk excluding this lawsuit, RVP is worth 50 cents a share.
The question is value of this settlement. If they win, after appeal (say 2 years), it is worth $6 (after taxes and legal fees) in today.s dollar since you get 5% interest. The question is the probability of success. Given the verdict it should be given above 50%, the question is how much above? .. I will give it 60% for some conservatism.
So fair value, adjusted for risk is $6 times 60% + 50 cents company value = $4.1
Now assuming investors buying now would want 10% return on top of 5% return, price needs to be discounted 20% given this a price target of $3.2
Now investors want a 40% discount to fair value to buy in giving this a buy at $2
In the $2 valuation I have built in a rather safe amount of conservatism and have put no value for equitable relief. So, I think $2 is a very safe entry point . Market may choose $2.5 as a min which also fits in with charts.