One can't discount this one although the P/E's look high. Consider this: Sales increased by 7.2% to $36.7 mill. to June 30, 2003 but profits rose 36% to 5.5 mill. (Net margin: 15%).
The normally quiet first quarter shows sales are now up by 21% and they are desperately busy increasing output.
There are 5 reasons why this small company performs very well if not the best in the country: 1. Board and knowledge are superb. Shares are also tightly held. 2. R&D is given top priority and the most modern machines are being used. 3. Their products are advanced and can compete. 4. The Exhibition in Germany is doing wonders. Presumably, they will go there each year. 5. Only 23.4 mill. shares. Plenty of scope for expansion!
SDI is counting on E/S of 34 cents or an increase of 45% on the previous 23.3 cents. I think that 50% will be earned barring unforseen circumstances. So, the guided E/S could be 35 cents. (That could be conservative)
The current price is about $10.40, so the prospective P/E is 29.7. That may look fully priced but I believe that the inertia is too great to stop this train. It is increased production with little increase in labour costs which matter here. I did spent some time on this and am impressed. Thanks Donnie.
The price has increased dramatically due to new inventions, the German exhibition and the corresponding increase of output:
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