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Strategies & Market Trends : Value Investing
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To: Robohogs who wrote (47054)3/15/2012 10:46:18 PM
From: Paul Senior  Read Replies (2) of 78705
 
"At 1% margins, a slight miss leads to losses."

That sometimes seems to be the reason that people won't buy such stocks. In my experience, I've found that that concern about low absolute margins to be almost unfounded. First, companies can often go years or decades doing okay with low margins. Especially if they have a lot of sales per share (low p/sales ratio). Grocery chains, for example.

I could wrong here of course, but as far as I can tell, DIT seems to be doing just fine with its low-margin distributor model.
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