Replies to post #44858 on Value Microcaps Motherboard

[rrufff]

No convertibles and no discount PIPE's.

Reasonable freebie and discount shares with management.

No Insider loans that are used to buy shares.

No PR outfits that get tons of shares. (I mean how tough is it to write up a PR?)

[lentinman]

Bunky:

"i believe you stated if there were commandments for microcap investing...1 & 2 would probably be "60m shares max and low float "what figure would you use"???
question i have for you is what would you suggest for the next 3 commandments ?"

I cannot divorce my own thinking about it from this board. Therefore the FIRST TWO (and only) "commandments" are in the IBOX.

1) A stock must have earnings.
2) A stock must report quarterly.

Now, onto numbers 3 through 10.

3) IMO, the ideal stock would have a maximum of 60M shares outstanding, but overwhelmingly superior if 15M or below.
4) IMO, the ideal stock would have less than 40% insider ownership, but more than 15%.
5) IMO, the ideal stock would have a float of 3-8 million shares. Lower is great in a rising market, a killer trap in a dropping market.
6) IMO, the ideal stock would have no (or very little debt) and (cash minus debt) divided by market cap to equal at least 10% and preferrably 20% or more. This is a stat nobody keeps. You have to figure it yourself.
7) IMO, the ideal stock is at or near a 13 week low.
8) IMO, the ideal stock is in a sector that reasonably could (should) still be a good sector even if the markets have a major correction.
9) IMO, the ideal stock has a P/E or forward P/E of under 10.
10) IMO, the ideal stock would be priced under $5.

If a person could find a stock that fit all of these parameters, and they keep it at least 6 months, they would rarely lose IMO.

Len