Micro Cap Public Company Financing

There are numerous intrinsic value gaps in the micro cap universe that provide Plutus Capital and its investors with excellent investment opportunities. Plutus Capital’s criteria for publicly micro cap public companies is that they are trading at 33% to 75% discount relative to the market based upon various fundamental equity valuation ratios [1] (prices of stock relative to sales, cash flow, book value, EBITDA and earnings.) This helps mitigate risk and provides superior risk/reward ratios to our clients. It’s much easier to double the performance of a $50 million company than do the same to a $1 billion company. Our policy is to advise companies that require from $3 million to $100 million, because that insures the liquidity for our investors’ exit which we project to be between 6 to 18 months.

Below is what Plutus Capital focuses on when executing public company micro cap transactions (primarily PIPEs or Private Investments in Public Entities:

• The price goes too high and the stock becomes overvalued: Plutus Capital always uses conservative valuations. In fact, we typically get our investors in deal 50% to 80% undervalued relative to the market.
• The earnings surprise arrives on the downside: Plutus Capital establishes a very personal relationship with management. This allows us to anticipate any future hurdles with the company’s operations, which allows us to get almost an exact estimate of its future earnings.
• The company’s industry falls out of favor: Plutus Capital executes a full evaluation via research reports and seeks third party opinions from many expects in the industry which the client companies fall into. Generally, Plutus Capital focuses on companies that have niches in its industry or companies in emerging industries.
• The stock price falls by 15% or more and it loses its relative momentum: Plutus Capital has top notch financial public relations and investor relation firms working for us. This achieves strong momentum and steady price increases.