VirTra Inc (VTSI)

[KauaiPI]

Tim~sorry bud but you are confusing terms...

FWIW, when researching a company, I try to find them trading under 3x book. Anything over 5x, is overvalued, imo. On P/Es (if they have them) I look for under 20x. So at 3x book, what do we get (one of the reasons I don't trade many OTCs, as that info isn't readily available)

Enterprise value does NOT equal "Book Value"...

Enterprise value is market cap + debt - cash ...

you know, the actual cost of buying the entire company ie buying the O/S stock, acquiring the debt and pocketing the cash if there is any.

Book Value

1. The value at which an asset is carried on a balance sheet. In other words, the cost of an asset minus accumulated depreciation.

2. The net asset value of a company, calculated by total assets minus intangible assets (patents, goodwill) and liabilities.

Book value is the accounting value of a firm. It has two main uses:

1) It is the total value of the company's assets that shareholders would theoretically receive if a company were liquidated.

2) By being compared to the company's market value, the book value can indicate whether a stock is under or over-priced.


Your strategy of buying based on them selling below book value is IMO a solid one. However, you should check out the quality of the assets on the books for this to work in your favor. Writing down non performing assets can really change that number come time "of the next" 10Q or 10K

BTW, since the PE varies from industry to industry, you might revisit your PE strategy as well. Comparing apples to apples is the way to go. Too many investors fall victim to apples and oranges!

best!
kp