Quote from: killerstorm on July 11, 2013, 10:59:19 AM

Quote from: Trillian on July 11, 2013, 09:26:49 AM

I clearly don't understand enough, because I keep being wrong with my price estimates for BM. If dividends do not motivate investors, then it must be the potential future growth of the company, which with BM is tied to the miners they own and acquire. Still BM does not have production capabilities like AM (not that I am aware of atm), and their assets (miners) are depreciating in value.[

I am looking for the pot o' gold at the end of the rainbow for BM, but I cannot see it. I cannot see why investors have such a strong valuation of the future of BM.

Quite likely it is a bubble pumped by irrational investors who are excited about dividend growth but do not understand fundamentals.

If you do not want to make your own profit projections, you can look at similar companies. Say, Nasty Mining now has 270 Gh/s of hashing power (via 5x BFL 60GH/s ASIC Miner), which correspond to 13.7 Mh/s per share. Those shares are traded at about 0.46 BTC. So, Nasty Mining offers 30 Mh/s per BTC. (Cost of 1 Mh/s is 0.03 BTC)

BASIC-MINING's hashrate is 225 Gh/s, which corresponds to 4.5 Mh/s per share. Share price is about 0.37 BTC, so we have 12 Mh/s per BTC, or 0.08 BTC per Mh/s.

So whatever it is, it is definitely not about hashrate... But if you look closely, BASIC-MINING share price growth when hashrate increases, so it is very likely that investors are just irrational and just buy more when they see positive news.

Now if we continue BASIC-MINING vs Nasty Mining comparison, BASIC-MINING definitely has bigger cash reserves. However, Nasty Mining has 5x BFL 60 GH/s ASIC miners in preorders, so it will double its hashrate when those are delivered (I'll remind you that they already got 5 such machines, which are mining for a week or so already.)

Nasty Mining also bought some shares in group buys, and it has some liquid assets.

Well, anyway, fundamentals do not matter much when people buy irrationally.

What is irrational about the desire to invest in a well-managed company with a recent track record of rapid growth?

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