The Compelling Upside Potential: 40-to-60-to 1 Appreciation over 18-36 Months.
It is simple math: for approximately $6.5 million USD, VELA recently acquired 100% of CM Mobile, a 13-year old licensed mobile virtual network operator or MVNO located in Hong Kong. Over 125,000 prepaid and post-paid customers (mostly frequent business travelers from China who travel to Hong Kong/Taiwan/Macau) use CM Mobile to save 75% OFF roaming charges from their local mobile network operator.
With over $14 million+ USD in forecast 2014 revenues and $1.6 million pro-forma 2014 cash flow, VELA recently refinanced CM Mobile at a $10 million valuation or approximately $80 per CM Mobile subscriber (80% of which are pre-paid subscribers)… and VELA still owns 100% of the company.
We will cover the massive 10X-20X CM Mobile growth strategy in a moment…but bear-in-mind…
Currently, the ENTIRE market cap value of VELA is around $1.2 million…yes that is right. As a 100% consolidating subsidiary of Velatel Global, 100% of CM Mobile's revenue and EBITDA cash flow will be reported by VELA in 2014.
That is upward of $1.4 million in EBITDA based on their disclosed financials.
CM Mobile's 2013 cash flow now exceeds VELA market cap…amazing. MVNO companies are valued at 4-8 times EBITA...VELA is now valued at .8X estimated 2014 EBITDA for CM Mobile or less than 1X earnings before interest, depreciation and amortization expense.
Even assuming VELA's equity ownership stake of CM Mobile is reduced to 60% from additional equity capital (and a 25% investment option held by a major $billion mobile network operator is exercised) there is currently @$5 million mispricing of VELA stock valuation vs. CM Mobile or 5-to-1 upside at current valuations.
Again…CM Mobile's current $10 million private market value ($80 per subscriber) and its very real > $400,000 per quarter cash flow vs. VELA the publicly traded holding company $1.1 million market cap is a massive disconnect in valuation.
read more: http://bit.ly/1dyYe1L
| 0.0091 | 0.0008 9.64% | 0.00% | 3,098,236 | 18.2M |
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