I conducted a sensitivity analysis for variable forecasts in my valuation for PPY. With my last valuation, the terminal value wasn't discounted to its 2018 present value. I corrected this error in my expected value section of this analysis.
Less Than Expected Forecasts
- Operating Costs: 25%
- Tokens: 3,785,384
- Discount Rate: 15.00%
- Terminal Growth Rate: 5.00%
Expected Forecasts
- Operating Costs: 15%
- Tokens: 3,785,384
- Discount Rate: 15.00%
- Terminal Growth Rate: 5.00%
Exceeds Expected Forecasts
- Operating Costs: 10%
- Tokens: 3,785,384
- Discount Rate: 15.00%
- Terminal Growth Rate: 5.00%
If you have any suggestions for other simulated scenarios, please let me know!
I think a big source of error is the market share. Their market share will be tiny in this huge market. I think that you overestimate the market share. And since it is such a small number it is of course hard to estimate.
Initially, the market share will be small, however, over a period of 5 years with competitive Dapps I believe their market share will at least hit the first table's targets. I can certainly setup a few more models with smaller market share growth. Thanks for your input!
thanks