Dutech Holdings

[MINX]

I have added a bit after the price dipped to 48.5 cents today; doubt if it will go back to 44 cents at the present rate it is growing. Based on pure earning power alone, I estimate its intrinsic value at 70 cents, so if we apply a 50% margin of safety, should buy only at around 46.5 cents. But if I factor future growth, then I would give it an intrinsic value of 90 cents, which means it's a bargain to go in even at 50 cents. The only reason why I hesitate to go in heavy is because it's after all, still an S-chip, but it's financial performance the last 8 years (have not analysed FY16 yet) has not given me any reason to suspect any hanky-panky in this company. But still, caveat emptor; just my 2 cents worth.

Intrinsic value of 70cents... that's pretty much ard what I got from my calculations based on projected FY17 earnings.
In Q4 results, they conservatively wrote off some assets, wrote of some receivables, and in the coming quarters, will be amortizing the goodwill.
All that will be a drag on earnings, but in the long run, is good for the company
FCF is still +be despite having to do 2 acquisitions in FY16, both funded internally!

Intrinsic value of 70c, to cater for all the known risks & the unknown ones, a good entry price is 35c, correct? 

Huh...
in that same vein, a good entry price is 1 cent!

I don't think we can just fix arbitrarily a 50% MOS. It depends on the industry, the business and the management.
For eg. if the industry typically trades at a substantial discount to BV, then your MOS has to be wider to account for the fact that the real value is always at a discount anyway.
If the business is funded by a lot of debt, you might need a wider MOS because you don't know when the environment will change and credit dries up etc.
I really wouldn't try to second guess the craziness of the markets.... but I highly doubt you'd see 35 cents anytime soon, barring a GFC in 2017.
I bought the 570,000 in 2015 when it was around $0.27,28
and most recently added 60,000 in 2016 when it was around $0.45.
IMHO that's a price with a good enough MOS. I'd add again if it reaches there, and if Dutech isn't a large enough part of my portfolio.
Gotta pay some attention to portfolio allocation too, previously I made some mistakes with position sizing.

I see...I am unfamiliar with this company, so I put on some extra padding before I dip my toes in, so I don't get sleepless nite. Anyway, with the steep rise in steel prices, metric still bleeding, the earning outlook is muted at best for 2017. Perhaps, I might still be able to stick a leg in at 35C...