Pfizer Inc. (PFE), United Therapeutics Corporation (UTHR): How Big Is Organovo Holdings Inc (ONVO)’s Market Opportunity?

At the same time, the company sees the possibility of developing tissues for therapy. When that time comes, Organovo will expand its scope to include lung, bone, and blood vessels.

Overall, the revenue and development stream looks something like this.

Source: Organovo.

Don’t do too much math

If we make an assumption of $300 million in revenue by 2018, with a conservative estimate of 10% profit margins, earnings would come in at $30 million. Assuming the number of shares outstanding stays the same (which it probably won’t), and a P/E ratio of 30, the company could be worth $900 million by 2018. That gives investors a nice 20% rate of return from today’s market cap of about $370 million.

But the reality is that these assumptions should be taken with a grain of salt. History has proved time and again that we humans stink at predicting the future. That’s why investors in Organovo — myself included — need to be well aware of the risks associated with investing in the company.

At the end of the day, there are literally hundreds of “multiple futures” — as Foolish co-founder David Gardner likes to call them — that Organovo could take. Some of those possibilities include bankruptcy, and some include amazing profitability.

The article How Big Is Organovo’s Market Opportunity? originally appeared on Fool.com and is written by Brian Stoffel.

Fool contributor Brian Stoffel and The Motley Fool have no position in any of the stocks mentioned.

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