Not to be negative on the company, as I hold shares and I would love for it to return to 40 cents too, I think at 2.4 cents, it is probably at value now.
Of course, if it maintains its profits then its value will increase, as it increases NTA, etc.
So if they make another 0.27 cents (assuming my last calculations were correct), then NTA next quarter would be somewhere near 1.87 - 1.97 cents, which might increase the share price. This will of course reduce the p/e ratio. It would then need to show growth in earnings to make the p/e back to around 9.
If it continually creates profits, then its p/e ratio could be considered to be too low at 9 and push up to somewhere between 10-14.
As I stated in an earlier post, shares are priced at how much one is prepared to pay for them. Value is different.
Price is influenced on many things, including possible future earnings. If QTM said that they expected revenue (and more importantly profit) to double each year, then you would expect people to pay a lot more for them.
This, of course, is only my view but I hope it helps. It does not suggest QTM will not hit 40 cents again soon so please do your own research and do not sell or buy on my advice alone.
Personally, I would only be buying this company anywhere below current NTA, and only at a premium if it continues to make future profits.
Good luck.
QTM Price at posting:
2.4¢ Sentiment: Hold Disclosure: Held
