Update 2019: RoodMicroTec is a 50-year-old company, currently involved in ASIC chips. But it doesn't do:
-assembly
-design
or have a
-wafer fab.
The company is not reliably profitable and the share price has fallen to EUR 0,17, the book value is EUR 0,02 per share.
Warren Buffett says: “Any investment is worth all the cash you’re going to get out between now and judgment day discounted back to today."
Recently if you are a RoodMicroTec owner, you have been putting cash into the company, instead of getting any out. The company takes money out of the market by selling tens of millions of shares.
Update 2018: 2017 67 million shares x EUR 0,27 per share -> Market cap: EUR 18m
Company seems to be breakeven, sales are up towards EUR 18m per year. Price is 1x sales.
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RoodMicrotec is a small "semiconductor company supplying products (chips and packaged devices) and services."
In the past few years it has been losing money whilst selling shares to finance operations.
Share count:
2013 39 million shares
2014 43 million shares
2015 54 million shares
2016 63 millions shares
2019 75 million shares
Source: https://www.iex.nl/Aandeel-Koers/11956/RoodMicrotec/fundamentele-analyse.aspx
In total 24 million shares sold to investors at an average price of roughly 20 cents each, resulting in 4,8 million Euros flowing into the company. Today total equity (book value) is only 4 million...
Shareholders are the only thing keeping this company from going bankrupt.
2018: Conclusion: Not a stock for the Graham Defensive Investor.
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