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Birdy
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May 31, 2013, 12:37:13 PM |
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So help me understand something. Here's a small compilation I made with the 90-day dividend yield estimates (according to BTCT.CO) of its more popular assets.
[big picture]
According to the numbers, ASICMiner is by far the most profitable asset by approximately ~200% compared to GDSPT, the nearest one. Wouldn't this mean that ASICMiner share value has still a lot of space to grow?
Correct me if I'm missing something. Thanks.
I think a lot of the investors of those lower shares are hoping for a bigger jump of those shares in the future (new mining equipment or whatever). Also some of those price increases in Asicminer are from hardware sales, which will afaik end soon. I think there is still space to grow anyway (just recently bought in with a few shares) |
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SmiGueL
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May 31, 2013, 12:44:59 PM |
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Also some of those price increases in Asicminer are from hardware sales, which will afaik end soon.
I really think it just started yet  200TH/s is coming in a couple of months. I'm pretty sure some of that will be sold. And why would the USB Block Erupter production stop after 10k sold units? I suppose there will be larger orders than that if this batch is sold out (with maybe even more chips, or faster ones)  Okay, maybe not in a few weeks, or a month, but I'm pretty sure friedcat will announce some new things this summer. He's very good at that  |
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furuknap
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May 31, 2013, 12:47:30 PM |
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Correct me if I'm missing something. Thanks.
You're missing about 90% of the factors needed, so it would take a long time to correct you. Looking at dividends is like looking at the previous two weeks of weather reports and concluding that it will be rain/sunshine/snow for the rest of eternity. One thing most people are missing is the decline in share value that will happen in just over three years when the block reward halving happens. Because of AMs size, there's not much room for growth in percentage of network hash rate so the mining dividends will probably drop to about half. Because a lof of the current dividends is derived from hardware sales, which is a short-term opportunity, the real yield, taking into account the reduced hardware sales over time plus the reinvestment needed for hardware sale plus the halving effect, is far, far lower than you currently see. In calculations I've done (and partially published) it's not very far from reality if you consider between 80-100% in yield of the percentage of the network that AM holds. In other words, if AM holds 100% of the network (which of course they never will), you can estimate a yield of 80-100% and if they hold 25% of the network, you can estimate a yield of 20-25% per year. This figure depends a lot on what cost their next generation hardware will be (to them, not consumers) and how quickly competitors can delivery in scale. If for example BFL is able to deliver 65nm chips en masse before AM then you may consider reducing the above estimate to somewhere in the 65-85% area. We don't know how much money AM has set aside for second generation chips, nor how much they will cost, but at some point, that cost will come out of dividends, so if they haven't set aside sufficient money for NRE, the dividends will need to pay for that in the upcoming months. These are just a few factors to pour some cool water into your veins. If AM wins the race towards second generation chips for mass market, you're looking at a 20-25% yield if AM keeps on average 25% of the network consistently over five years. .b |
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mvidetto
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May 31, 2013, 01:16:06 PM |
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So help me understand something. Here's a small compilation I made with the 90-day dividend yield estimates (according to BTCT.CO) of its more popular assets.  According to the numbers, ASICMiner is by far the most profitable asset by approximately ~200% compared to GDSPT, the nearest one. Wouldn't this mean that ASICMiner share value has still a lot of space to grow? Correct me if I'm missing something. Thanks. I believe you are correct, but a lot of people see the share price as overvalued because it has gone up so far .1 BTC -> 2.5 BTC. But if one truly does the math valuing the company at 1 million BTC (2.5 BTC * 400k shares). They are earning ~300k BTC per year just from mining, and their sales more than likely double that on a yearly basis (atleast this year). This gives them a P/E ratio of roughly 1.66. Anyone who knows anything about P/E ratios especially in the tech market knows this is surprisingly low. However, one of the reasons it is low is because of difficulty to trade shares and the high risk associated with holding them. These reasons may outweigh the pros to outside observers and makes it difficult for newcomers to engage in trading the stock. |
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circuitry
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May 31, 2013, 01:18:31 PM |
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Correct me if I'm missing something. Thanks.
You're missing about 90% of the factors needed, so it would take a long time to correct you. Looking at dividends is like looking at the previous two weeks of weather reports and concluding that it will be rain/sunshine/snow for the rest of eternity. One thing most people are missing is the decline in share value that will happen in just over three years when the block reward halving happens. Because of AMs size, there's not much room for growth in percentage of network hash rate so the mining dividends will probably drop to about half. Because a lof of the current dividends is derived from hardware sales, which is a short-term opportunity, the real yield, taking into account the reduced hardware sales over time plus the reinvestment needed for hardware sale plus the halving effect, is far, far lower than you currently see. In calculations I've done (and partially published) it's not very far from reality if you consider between 80-100% in yield of the percentage of the network that AM holds. In other words, if AM holds 100% of the network (which of course they never will), you can estimate a yield of 80-100% and if they hold 25% of the network, you can estimate a yield of 20-25% per year. This figure depends a lot on what cost their next generation hardware will be (to them, not consumers) and how quickly competitors can delivery in scale. If for example BFL is able to deliver 65nm chips en masse before AM then you may consider reducing the above estimate to somewhere in the 65-85% area. We don't know how much money AM has set aside for second generation chips, nor how much they will cost, but at some point, that cost will come out of dividends, so if they haven't set aside sufficient money for NRE, the dividends will need to pay for that in the upcoming months. These are just a few factors to pour some cool water into your veins. If AM wins the race towards second generation chips for mass market, you're looking at a 20-25% yield if AM keeps on average 25% of the network consistently over five years. .b I have actually considered some of the factors you mention, in part because I have carefully read both this thread and your blog posts on the matter. Surely there are a lot of uncertainities about AM and it's not a long shot to expect some bumps on the road. Still, I wonder why other assets' valuation is (by comparison) higher than AM's, in exchange for (from an outsider's viewpoint) a considerably less ambitious operation. Friedcat and company have outperformed themselves several times, whereas the rest of the assets' seem to be stagnant, and generate smaller (and dwindling) dividends. Nobody can predict the future of AsicMiner, but as far as present shows, things looks brighter and more promising in AM's camp than others'. Anyway, thanks for taking the time to answer and shine some light on my way. I'm still learning about all this stuff. |
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furuknap
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May 31, 2013, 01:32:01 PM |
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Still, I wonder why other assets' valuation is (by comparison) higher than AM's, in exchange for (from an outsider's viewpoint) a considerably less ambitious operation. Friedcat and company have outperformed themselves several times, whereas the rest of the assets' seem to be stagnant, and generate smaller (and dwindling) dividends.
One reason is that smaller companies still have room to grow. If you control 1% of the network hash rate, increasing to 5% with addition of new hardware is feasible. If you're AM, you can't really double your mining proceeds because you'd be above (or very close to) the 51% limit. Thus, what you see in some mining assets is the expectation of profitability increase whereas at this point, the dividends from AM can really only go down. That's why hardware sales is so key to evaluating AM right now; if someone comes out with next-gen chips for mass market before AM and grabs a huge chunk of the hardware market then AM will fall back to a dividend must lower than today. Add the halving effect (which is around 0.03 per month at a price of 2.5BTC) and you're seeing yields possibly down to 10-15%, which is not entirely what most people bought even if it is a good deal. Of course, if AM's total network percentage over time is anywhere near what friedcat predicted (10%) then dividends will be negative in real value, which would be a complete disaster. In other words, AM must exceed it's own expectations by 150% to return the same yield (20-25%) as some other mining assets. Oh, and just to beat the haters and naysayers to the punch, I still have great confidence in AM in the long run, I just don't think everyone realizes how long a run that must be :-) .b |
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tkone
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May 31, 2013, 01:45:06 PM |
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i think we are still really early, and still have alot to go, the halving of blocks shouldnt hurt because by then i think transaction fees will give us more profit then the blocks, meaning our dividends will go up in time from transaction fees going up, once more ppl start using bitcoin, more transactions, and more transaction will want to be confirmed faster, paying larger fees, and those fees will go to the miners that mine the block, and since we will be holding a good amount of the hash% we should be getting alot of those profits, also asicminer has proved to be the best at mass producing asics and selling them real fast, even though they were not the first to start creating them, so that means asicminer is doing something right, so seems like they will continue to do it right, and even more hardware sales from better equiptment, also once transaction fees really start kicking in and making mining even more profitable, then asic's will be more expensive and still be a really strong market, and remember we are most advanced in this market, so we have the head start over others, also more ppl catching on to bitcoin will see that for longer peroids of time this share has been holding value and dividends rising, will pick the share price up, i really think this share is undervalued even at 2.5 i think true price should be around 5btc each, and eventually when transaction fees will be even higher then the share price can still rise, really sky is the limit, it all depends how much bitcoin will adapt, also once price of bitcoins starts to rise to lets say 1k, 10k, 50k, 100k, 200k 500k, per bitcoin, this share will once again rise and rise, really we far ahead of everyone right now, aslong as we continue to keep the hashrate, we continue to pump out asics faster then anyone else, we should be fine or maybe a little tiny bit better then fine, depends what you define fine lol GL LONG LIVE ASICMINER LONG LIVE FRIEDCAT!!! |
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Lohoris
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May 31, 2013, 01:48:53 PM |
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i really think this share is undervalued even at 2.5 i think true price should be around 5btc each
And you would settle for a ROI of 4 years  I wouldn't. |
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furuknap
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May 31, 2013, 01:52:38 PM |
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Aaand then I remembered why I stopped posting analyzed data in this thread...
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creativex
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May 31, 2013, 01:56:58 PM |
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Aaand then I remembered why I stopped posting analyzed data in this thread... Then I'd urge you to start a new thread. I find your perspective to be a refreshing counterpoint. |
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circuitry
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May 31, 2013, 02:11:16 PM |
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Aaand then I remembered why I stopped posting analyzed data in this thread... Then I'd urge you to start a new thread. I find your perspective to be a refreshing counterpoint. +1 |
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runeks
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May 31, 2013, 02:14:21 PM |
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Because a lof of the current dividends is derived from hardware sales, which is a short-term opportunity, the real yield, taking into account the reduced hardware sales over time plus the reinvestment needed for hardware sale plus the halving effect, is far, far lower than you currently see. Why do you say hardware sales is a short-term opportunity? I would say it's the other way around. Income from mining will not go much above what it is currently, because of the 51% issue. Income from selling mining hardware is still far from saturated. People are bidding up USB miners to +$400 on eBay! The demand is huge and I think it would be a lot more profitable for shareholders if ASICMiner were to focus more on hardware sales now when there is such a large demand to satisfy. |
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velacreations
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May 31, 2013, 02:23:26 PM |
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Why do you say hardware sales is a short-term opportunity? I would say it's the other way around. Income from mining will not go much above what it is currently, because of the 51% issue. Income from selling mining hardware is still far from saturated. People are bidding up USB miners to +$400 on eBay! The demand is huge and I think it would be a lot more profitable for shareholders if ASICMiner were to focus more on hardware sales now when there is such a large demand to satisfy. I agree with this. If AM were to focus on hardware sales and put forth some development and marketing towards that (outside of this forum), hardware sales would become the major revenue stream for AM. Just look at some of the competitors who haven't even delivered products. They've raked in plenty of money (and continue to do so). But, they actually have websites and sales departments and systems in place to make sales work well in a longer term context than forum auctions. IMO, AM should sell every single piece of hardware they can before competitors are able to deliver products. |
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binaryFate
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Still wild and free
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May 31, 2013, 02:59:22 PM |
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Why do you say hardware sales is a short-term opportunity? I would say it's the other way around. Income from mining will not go much above what it is currently, because of the 51% issue. Income from selling mining hardware is still far from saturated. People are bidding up USB miners to +$400 on eBay! The demand is huge and I think it would be a lot more profitable for shareholders if ASICMiner were to focus more on hardware sales now when there is such a large demand to satisfy. I agree with this. If AM were to focus on hardware sales and put forth some development and marketing towards that (outside of this forum), hardware sales would become the major revenue stream for AM. Just look at some of the competitors who haven't even delivered products. They've raked in plenty of money (and continue to do so). But, they actually have websites and sales departments and systems in place to make sales work well in a longer term context than forum auctions. IMO, AM should sell every single piece of hardware they can before competitors are able to deliver products. I agree. Just setting-up a professional-looking website, AM could sell astonishing quantities in pre-order for up to one year from here without problem, because their competitors look slower (to say the least  ) and because of the incredibly good reputation AM has (justified). I would imagine people canceling BFL order to jump on this. |
Monero's privacy and therefore fungibility are MUCH stronger than Bitcoin's. This makes Monero a better candidate to deserve the term "digital cash".
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bitfair
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May 31, 2013, 03:11:24 PM |
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I agree. Just setting-up a professional-looking website, AM could sell astonishing quantities in pre-order for up to one year from here without problem, because their competitors look slower (to say the least ) and because of the incredibly good reputation AM has (justified). I would imagine people canceling BFL order to jump on this. Please no pre-orders! :S Pre-orders gone awry can really taint a company's reputation, better to stick with friedcat policy: sell when ready to ship!  Edit: Apart from that, I agree - if it were easier to buy (i.e. didn't require PMing back and forth, organising group buys for hundreds of people, etc.), the hardware would command a higher price! |
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kokojie
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May 31, 2013, 03:28:55 PM |
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Why do you say hardware sales is a short-term opportunity? I would say it's the other way around. Income from mining will not go much above what it is currently, because of the 51% issue. Income from selling mining hardware is still far from saturated. People are bidding up USB miners to +$400 on eBay! The demand is huge and I think it would be a lot more profitable for shareholders if ASICMiner were to focus more on hardware sales now when there is such a large demand to satisfy. I agree with this. If AM were to focus on hardware sales and put forth some development and marketing towards that (outside of this forum), hardware sales would become the major revenue stream for AM. Just look at some of the competitors who haven't even delivered products. They've raked in plenty of money (and continue to do so). But, they actually have websites and sales departments and systems in place to make sales work well in a longer term context than forum auctions. IMO, AM should sell every single piece of hardware they can before competitors are able to deliver products. I agree. Just setting-up a professional-looking website, AM could sell astonishing quantities in pre-order for up to one year from here without problem, because their competitors look slower (to say the least ) and because of the incredibly good reputation AM has (justified). I would imagine people canceling BFL order to jump on this. It would probably bankrupt BFL, because they can't possibly cover cancellations of their entire customer base. |
btc: 15sFnThw58hiGHYXyUAasgfauifTEB1ZF6
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mrtg
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May 31, 2013, 03:31:33 PM |
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IMO, AM should sell every single piece of hardware they can before competitors are able to deliver products.
I agree. Just setting-up a professional-looking website, AM could sell astonishing quantities in pre-order for up to one year from here without problem, because their competitors look slower (to say the least ) and because of the incredibly good reputation AM has (justified). I would imagine people canceling BFL order to jump on this. Indeed! Setting up a website would go a long way towards legitimising AM and making it easier for customers to acquire products. Although pre-orders are a bad idea (mostly due to the bad connotation brought by other companies), selling directly from a web-store would certainly translate into more revenue. As a bonus, having a small "news" section would also help de-clutter the forum a bit... I'm sure there are quite a number of shareholders here with the required skills to provide hosting and development time for this -- myself included. Could a member of the Board discuss this at the next meeting perhaps? |
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EskimoBob
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Quality Printing Services by Federal Reserve Bank
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May 31, 2013, 03:33:06 PM |
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Guys, there are functioning web pages fort this type of "extended spread sheet" functionality Let me give ya'll a simple hint: https://btct.co/ |
While reading what I wrote, use the most friendliest and relaxing voice in your head.
BTW, Things in BTC bubble universes are getting ugly....
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mrtg
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May 31, 2013, 03:49:29 PM |
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Guys, there are functioning web pages fort this type of "extended spread sheet" functionality Let me give ya'll a simple hint: https://btct.co/Leaving aside the fact that BTCT can not be used for trading direct shares; we were talking about selling hardware and having a single, consistent place with all the information pertaining to it -- price, inventory, delivery, user guides etc. I think it's frustrating that vaporware products have a better on-line presence (and marketing) than a company with a proven track record like AM. And if you think "well, they did great like this anyway" -- just think how better they could do with a proper website! Looking at the future, we can not rely on an incompetent competition forever... |
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conv3rsion
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May 31, 2013, 03:55:38 PM |
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Also, I know there are lots of people who would like to become "official" resellers for these products (myself definitely included). The demand is insane. People are willing to pay $400-$500 per USB miner on Ebay (just look at recent sales). With the head start that they have, ASICMiner could become the world leader in ASIC hardware sales and as long as they continue to improve their hardware and stay competitive, profits from hardware sales could be much higher than profits from profits from mining.
Also, thinking longer term, since there are other types of single purpose applications (outside of Bitcoin) that could benefit from ASIC creation, there are opportunities to expand outside of mining and mining equipment sales. Password cracking comes to mind. A USB based password cracker that can smoke a 7970 would be in high demand as well.
Friedcat, we believe in you.
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