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Autobytel Inc. Message Board

  • conaz64 conaz64 Mar 15, 2012 12:11 PM Flag

    Valuation and terget by end of 2012.

    Internet stocks with good growth and profitability, generally trade from 3 to 10 or higher price-to-sales. ABTL made $64M revenue, $0.01 eps last year and poised for more growth in 2012. Per current estimates, 2012 will bring $0.05 eps and $70M revenue. I believe those estimates are old and they could easily beat it this year. Let's say they make $80M rev and $0.06 eps this year, then what price-to-sales market will pay for it? Let's assume, as low as 2 times sales, then it's $160M market cap. Divide by 46M shares = $3.50/sh by year end. I see very significant upside from here.

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    • I agree. Valuation is ridiculous. They will not do $80 million in sales, though. Maybe $70 million. That's worth about $3.80 per share (2.5X sales).

    • What makes this company good, is that they don't have to spend much more on general expenses to make a lot more money. It's not like they have to carry an inventory of twice as many widgets to make twice as much money. Likewise, they don't have to worry about selling a manufactured product. They sell the same item several times over depending on how many dealerships are interested in buying the lead. That's a good deal all the way around for the company and shareholders. Company definitely undervalued.

      • 2 Replies to aardvark1492
      • good points. Agree, their SG&A costs are all pretty much saturated. Now revenue growing double digit, last year 24% growth. As revenue keeps growing and expenses pretty static, easy equation ..bigger profit bigger EPS. This stock extremely undervalued at current and future potential.

      • If ABTL can start revving up the advertising revenues then we'd really see some incredible earnings. There is really no additional expense at all (other than some commissions) to sell online advertising now. It amazes me that they don't have much higher advertising revenue. They need to hire a better salesperson. Lead generation has it's limits, while advertising does not right now.

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