Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: robuck who wrote (54253)	8/12/2014 11:27:23 PM
From: Elroy	Respond to of 78628

You're not missing anything. SIMO has gone up about 70% in the past two months off of one great quarter and increased 2014 guidance. The fundamentals for SIMO for the next 18 months (maybe more, who knows?) are great. The big problem with the stock at the moment is valuation. It's hard to say what the fair value is for a rapidly growing well positioned small cap tech stock. 15x? 20x? 25x? 30x? Who knows? They'll likely make more than $2.00 in 2015 EPS, what do you want to pay for that? I really have no idea. But on a PE basis, the current price isn't too bad. $26 is only 13x $2.00 in 2015 EPS. Why not 20x? That would be a $40 share price. But what you can believe is that the news out of the company will probably be really, really good for the near future (at least the next 12 months), and as long as that is the case, perhaps the share price will just keep going up.