Value Microcaps Motherboard

[wadegarret]

shmoopy- MFIC

shmoop- I was in MFIC for a couple months, but got out recently at $2.70. I believe the company could do very well yet, but I think they're at least six months away from reporting good enough earnings and growth to support a 20-25 PE. Right now, the company has said it expects to grow revenues about 15% this year. To me, that growth should only support a 10-15 PE. Even if you give them a 20 PE going forward, that only comes to right around where the stock price is now. I feel that when they show a couple real good quarters with raised guidence, the valuation should be higher. Another thing to realize is that they're not showing taxes yet either, and that would effectively decrease EPS by around 33 %. Shmoop- I think the unknown here is how high a valuation the street is willing to give because of the Nano sector in general having so much potential. However, although I could be wrong, I am choosing to value MFIC with only a slight premium and am giving it a 20 PE going forward. Again, my thinking could be wrong on this one, but I just don't see the growth yet to support a real high PE going forward- best of luck. Wade