Less than one percent of all publicly traded companies over the last decade had paid their bills without taking on debt. Whatever IFON has, they have the ability to stay in business and never take a big loss, while not taking on debt, and keeping net working capital above share price at almost all times.
So, if you strip the cash tomorrow and close up shop, IFON shareholders probably get more than 50 cents. Whatever else that they have, and however you want to value their brand, it gets thrown in for free. And not only that, but the share price has a history of making huge moves some near this price. The company is essentially the same company it has always been. If they wanted more sales they could simply sell again in the United States, as the shares traded at over $4 when they did that, and they actually were pretty much the same company back then, with net working capital not even double the current amount, yet the price was almost ten times higher.
The only way to be able to buy a company for under net cash is to have things not look great to everybody. That is how you get the low entry price. We have a free shot to get some good news. If that happens, all longs will likely make multiples on their investment from this price of just under 50 cents. If it doesn't, longs can just wait it out until the next crazy spike for no reason, and sell then if the want. The price has spiked for no reason four or five times already this year, and those spikes were 40 to 100 percent, and they happened without notice, and the rise was almost immediate.
The shares will explode higher at some point, and we don't even need good news. It has proven it can move on absolutely no news, so longs have multiple ways to win here. There still has never been a huge selloff at this current level. The selloffs all come after huge spikes. It may trickle down at times, but 40-50 cents is a nice zone to acquire shares in, as there is limited downside, and a good chance at much higher prices at some point.
