30-09-2010, 07:25 PM
Glad to finally see a thread on Spindex. Another one of dydx's picks (dare I say favourites?)
Totally agree that this is a silent performer and has been one of my favourite holdings too.
Dividends:
0.0185 cents per share is a record payout. But at a payout of some 2.13mil dollars, I think it is within Spindex's ability to maintain this level of payout in future with 10yr avg Free Cash Flows of 4.1mil dollars. That's translates to a dividend yield of 5.5% at current prices. Not mind-blowing but still reasonably attractive.
Instrinsic Value:
By my calculations, Spindex is still far far away from intrinsic value (IV). It's even below the 50% margin of safety (MOS) from my calculated IV. As pointed out above, still well below NAV.
My beef with Spindex is that it deals in an industry where it probably competes on cost (hence the thin net margins) and I'm not sure how much of a branding one can do with precision equipments. Anyone in the industry please enlighten me. I'm really not in the know about this industry.
Of course, as d.o.g pointed out in Afralug before, most institutional investors are likely to avoid such small caps as they deploy capital in the millions which would mean easily triggering a take-over so this is one for the long-run and at current valuations, I think it's worth it.
I remember that there was a forummer by the name of 'Starbugs' who did pretty good analysis of Spindex as well. Last saw him/her in the CNA forum posting on Spindex as well.
Totally agree that this is a silent performer and has been one of my favourite holdings too.
Dividends:
0.0185 cents per share is a record payout. But at a payout of some 2.13mil dollars, I think it is within Spindex's ability to maintain this level of payout in future with 10yr avg Free Cash Flows of 4.1mil dollars. That's translates to a dividend yield of 5.5% at current prices. Not mind-blowing but still reasonably attractive.
Instrinsic Value:
By my calculations, Spindex is still far far away from intrinsic value (IV). It's even below the 50% margin of safety (MOS) from my calculated IV. As pointed out above, still well below NAV.
My beef with Spindex is that it deals in an industry where it probably competes on cost (hence the thin net margins) and I'm not sure how much of a branding one can do with precision equipments. Anyone in the industry please enlighten me. I'm really not in the know about this industry.
Of course, as d.o.g pointed out in Afralug before, most institutional investors are likely to avoid such small caps as they deploy capital in the millions which would mean easily triggering a take-over so this is one for the long-run and at current valuations, I think it's worth it.
I remember that there was a forummer by the name of 'Starbugs' who did pretty good analysis of Spindex as well. Last saw him/her in the CNA forum posting on Spindex as well.