Say you own a stock that is selling the same basic commodity for a decade and there is a surge in demand that takes the price up a factor of 20. What is the rational response?
1) Smile
2) Sell the stock
3) Find something with more value
As an example of a manufacturing stock with a market cap of $400M looks like (granted they are $600M), take API (just selected as the first one in the ASX alphabetically)
Revenue $4bn
EBIT $44M
Assets $509M
Dividend 5.9%
Compare that to ANO which has:
Revenue $15M
EBIT $5M (or $1.8M if you use last audited results)
Assets $8M
Dividend 0%
I'm not saying they are not a good company or they haven't cracked the secret of baking zinc oxide. My point is they just aren't a $400M company.
Fundamentals, page-13
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Last
76.0¢ |
Change
0.000(0.00%) |
Mkt cap ! $47.46M | |||
| Open | High | Low | Value | Volume |
| 0.0¢ | 0.0¢ | 0.0¢ | $0 | 0 |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 1 | 26756 | 72.0¢ |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| 82.0¢ | 5000 | 1 |
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