I do worry that looking at the revenue of a drug like Bydureon whose sales may have not fully ramped up yet may be misleading. Paying 6 times revenue may be pricing in future sales growth. As a comparison, Eli Lilly (LLY) trades at about two times revenue. So, using two times revenue, with a ramped up revenue estimate for Afrezza may be a safer approximation. Since there are so many risks with estimating future sales, I prefer to look at what a similar company was acquired for.

Revenue for Eli Lilly’s Humalog is about two billion, so let’s assume that that is a floor for potential sales of Afrezza. Using revenue of $2 billion with two times revenue equates to $4billion. Divide that by 500 million shares and it is $8 per share.

Again, I want to be conservative and don't want to expose myself to the dangers of falling in love with a stock. I am trying to find minimum prices, not the upside that I also believe we may see. I am long and I do believe in this stock. My point is that even with these conservative estimates, the return seems adequate.