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QuestionsIs Lantrovision undervalued?
WilliamChen83 asked 7 years ago

Hi Rusmin,
Lantrovision has consistent growth in its revenue and net profit over the last 5 years. It has a strong net cash position. Gross profit margin is about 30% (net profit is about 10%) and the firm has almost no debt. Rolling PE is lower compared to its peers. Is it still undervalued at its current price of $0.63?

1 Answers
Rusmin Ang answered 7 years ago

Hi William,  
 
It is no doubt that the financials look good and the valuation is attractive (from the way you describe it). Sometimes a company can trade at low valuations for a very long period of time which could become a potential value trap. The growth catalyst for such a company comes in only when you have a profitable business model, sustainable moat and attractive growth prospects that can be executed by good and capable management. So apart from the quantitative assessment, have you thoroughly analysed  their qualitative aspects?