If you have 100k shares, I would think think you stay on the fundamentals, rather than potential and contemporary biased information( eg. Recency biased).
Solvar is committed to doing what they do. So committed that it’s actually quite vertically integrated. Commitment to a business model. They are not impatient capital, trying to find a new home every six months. Do you agree there is a business there with markets to service, sustainability into the future?
Fair to say, market value to net tangible assets suggests that the market, right now, cares little about the business model. Less than nothing, apparently.
Based on their own reporting, interest margin has gone from 10% to 5% in two years, on growing revenue. Projected profit is close to halving also. That’s not rocket science. In addition, it’s a cash generative business, with clean accounting. Cash flows match the income sheet and make sense. SVR has good ‘look through’.
The only investment question is whether in the future, will margins grow or decline. 1$ billion is quite a big ship to turn around, albeit a sub 250 mill valuation.
For me, it’s a relatively simple one, but any investment activity, carries risks.
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