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

To: bruwin who wrote (66473)	2/9/2021 6:51:26 AM
From: JohnyP	1 Recommendation Recommended By E_K_S Read Replies (1) \| Respond to of 78702

SIMO is in a cyclical business. Cyclicals can go from unprofitability in bad years to extremely profitable at the top of the cycle. The company has orders of more than 700million this year and the constraint is manufacturing capacity. In my view there is some margin of safety even if they miss their projections by a bit. As for the cyclicality of the business, here you can see from 2011-2014 very low growth and then 2014-2016 doubling. So the argument of 1,2% growth over 5 years does not say all the story for a cyclical.