Hi Guys, Thanks for your figures and input. Will have a detailed look at this over the weekend. Looks like those large buys might be having an effect on the sp. Would be nice to see this move above 200p again having been in the doldrums for a while.
Correction to my figures
Of course my EPS figure of $4.4 is an EBITDA figure!
My calculation re possible AVN EPS
I've been looking back through past statements by the company. The CEO said that he expected the capacity to be sold out in 2016 and nothing has been said to amend that view. I take that to mean H1 & H2 as H3 will have only just come into service and H4 will not have been launched. If so, on the basis of the recent US$500M EBITDA which was derived from sales of US$700M, the expected turnover for 2016 should lie between £134M and £211M (ie max theoretical capacity). Yet the consensus analyst forecast for sales are £84M for 2016 and £114M for 2017. H3 would add a further £60M to the turnover if it sold out. So I believe the company should move into positive ground in 2016 and then become substantially profitable as H4 kicks in with its much larger capacity from 2017 onwards. Everything depends on the selling price being maintained at $2000 per MHz per month and the capacity sold hitting 2/3rds of theoretical max capacity. If it can do this it will have earned and deserve a higher PE than companies such as Inmarsat as its market is narrower and growing faster.
My calculation re possible AVN EPS
Looking again at the Financial report for 2014 I am encouraged by the notion that if Avanti continues to sell its space at its planned price structure, the recent declared EBITDA of $1.7 million will be increased to EBITDA of $500 million. Now, I am no accountant, and maths not one of my strong points, so please correct my following calculation if its wrong! My thoughts are that If this target of $500 million dollars is reached, then given the number of shares in issue, ( around 112 million shares, the present loss per share of around 80 cents, should be translated into an EPS of around $4.4 This seems to me to be a clear pointer as to why we should hold these shares. What do others think?
Thanks very much for your Interesting posts. Looks like someone also worked that out with two massive buys gone through this morning of 668,560 shares at a cost of £1,323,748 each! Should we not see an RNS covering those?
Having now had the chance to look at the figures for competitors I am confirmed in my belief that AVN is a potential star amongst satellite operators in ageographical area where they seem to be getting real traction. I still don't understand why the analysts are predicting such low sales figures for 2015 and 2016 given that sales seem to have been doubling year on year now that AVN has succeeded in putting together a credible fleet. On that basis I would expect sales in 2015 to be closer to GB£80M+ (analysts:£52.9) and 2016 commensurately higher. The whole case for AVN now rests on the team selling the space at $2000 per MHz per month or better and not selling valuable capacity at a cut price. I suspect (?hope) that the BoD has now got its act together in respect of information released to the market. If they have I expect the run up to the AGM on 27/11 to be well prepared by RNS announcements as by then we will be nearly through the 2nd Quarter of 2015.
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