As of May 28, 2025, Lee Pharmaceuticals has a Discounted Cash Flow (DCF) derived fair value of $0.01 per share. With the current market price at $0.07, this represents a potential upside of -92.9%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $0.00 |
| DCF Fair Value (10-year) | $0.01 |
| Potential Upside (5-year) | -97.3% |
| Potential Upside (10-year) | -92.9% |
| Discount Rate (WACC) | 5.4% - 7.2% |
Revenue is projected to grow from $9 million in 09-2004 to $11 million by 09-2014, representing a compound annual growth rate of approximately 2.0%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 09-2004 | 9 | 3% |
| 09-2005 | 9 | 4% |
| 09-2006 | 9 | 2% |
| 09-2007 | 9 | 2% |
| 09-2008 | 10 | 4% |
| 09-2009 | 10 | 2% |
| 09-2010 | 10 | 4% |
| 09-2011 | 10 | 2% |
| 09-2012 | 11 | 2% |
| 09-2013 | 11 | 2% |
| 09-2014 | 11 | 3% |
Net profit margin is expected to improve from -14% in 09-2004 to -6% by 09-2014, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 09-2004 | (1) | -14% |
| 09-2005 | (1) | -10% |
| 09-2006 | (1) | -9% |
| 09-2007 | (1) | -8% |
| 09-2008 | (1) | -7% |
| 09-2009 | (1) | -6% |
| 09-2010 | (1) | -6% |
| 09-2011 | (1) | -6% |
| 09-2012 | (1) | -6% |
| 09-2013 | (1) | -6% |
| 09-2014 | (1) | -6% |
with a 5-year average of $0 million. Projected CapEx is expected to maintain at approximately 3% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 09-2005 | 0 |
| 09-2006 | 0 |
| 09-2007 | 0 |
| 09-2008 | 0 |
| 09-2009 | 0 |
| 09-2010 | 0 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 37 |
| Days Inventory | 165 |
| Days Payables | 78 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 3M/2005 | (0) | (0) | 0 | 0 | (0) |
| 2006 | 0 | (0) | 0 | (0) | 0 |
| 2007 | 0 | (0) | 0 | 0 | 0 |
| 2008 | 0 | (0) | 0 | 0 | 0 |
| 2009 | 0 | (0) | 0 | 0 | 0 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 0.00 | -97.3% |
| 10-Year DCF (Growth) | 0.01 | -92.9% |
| 5-Year DCF (EBITDA) | 0.00 | -92.9% |
| 10-Year DCF (EBITDA) | 0.01 | -86.1% |
Is Lee Pharmaceuticals (LPHM) a buy or a sell? Lee Pharmaceuticals is definitely a sell. Based on our DCF analysis, Lee Pharmaceuticals (LPHM) appears to be overvalued with upside potential of -92.9%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider reducing exposure at the current market price of $0.07.