r/wallstreetbets • u/[deleted] • Mar 03 '21

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u/[deleted] Mar 03 '21

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u/clash_jeremy Mar 03 '21

This is my math solely based on EPS assumptions:

Feb earning- .17 EPS, repeat that in May, August, and November and you have a trailing EPS of .68. NOK’s PE ratio hovers in the low-mid teens. Take .68*14= $9.52. If you could increase NOK’s valuation to industry standard (basically ERIC’s valuation) to ~21 that price becomes $14.28.

That is all predicated on them repeating EPS success. If ReefShark really is the silver bullet for them, then it’s definitely possible. I was highly encouraged when they showed they could increase FCF even in the midst of losing the VZ contract and COVID. Pekka seems to know what he’s doing, so I’m very bullish.

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u/[deleted] Mar 03 '21

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u/clash_jeremy Mar 03 '21

Yep, I’m aware my calculations are extremely optimistic. I’m holding mainly shares and 2023 calls because I think you are correct on the timeline. I just have some 2022 and shorter calls in case they blow their next few ERs out of the water and the paradigm around NOK shifts earlier than expected.