SONICS & MATERJALS, INC. SIMA
June 06, 2019 - 6:01pm EST by
dadande929
2019 2020
Price: 10.00 EPS 0.94 0
Shares Out. (in M): 34 P/E 0 0
Market Cap (in $M): 34 P/FCF 0 0
Net Debt (in $M): 0 EBIT 4 0
TEV ($): 13 TEV/EBIT 0 0

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Description

Description (The above with the exception of price is June 2018 information as the company provides financials but once for  fiscal year ended June 30 each fall)


THIS STOCK IS DIRT CHEAP WHEN MEASURED BT CASH AND TANGIBLE BV

Sonics &  Materials Inc. engineers ultrasonic bonding equipment for the welding, joining and fastening of thermoplastic components, textiles 
and other synthetic materials, and ultrasonic liquid processors for dispersing, blending, cleaning, degassing, atomizing and reducing particles 
as well as expediting chemical reactions. 
 

The company was incorporated in 1969 in New Jersey and reincorporated in Delaware in 1978, went public in 1996 but deregistered and went dark 17 years ago in October of 2002. They are still in the same lines of business they have always been in and there is plenty of information available despite their only providing financiai info once a year in the fall. To keep updated on products and services old and new its very detailed  website www.sonicsandmaterials.com we have found useful as well as conversing with customers and potential customers in addition to the limited competitive producers.SIMA continues to do  business internationally too.

Robert Soloff the founder, principal owner, age 80 this year still leads the Company and his daughter Lauren, an attorney, age 53 is second in
command. They continue hiring able staff, adding and improvising products and filing patents. It is noteworthy that R&D expenses (not capitalized) are about 10% of sales annually and as you shall see in a moment profit margins are still net of this, double digit.

To describe them as very careful and financially conservative and risk adverse is to understate the meaning of conservative. The balance
sheet stats will save words.

 

We have the audited statement for several past years. An unusual, indeed incredibly undervalued one, unique at this moment in time. This stock has these statistical features.

 

 
Key Statistics as of Fiscal Year ended June 30,2018

 

                          Per Share Total Dollars

 

 

 

 

1. Cash                              $6.05                      $20,580,658

 

 

 

2. Working Capital          $8.68                      $29,517,937

 

 

 

3. Book Value                  $8.06                      $27,414,632

 

 

 

4. EPS                                $0.94 (Vs. $0.66)  $  3,206,682

 

 

 

 5. P/E 10.6x

 

 

 

6. P/BV 1.24x

 

 

 

7. P/Cash 1.65

 

 

 

 

 


We have every reason to believe that the company was profitable in its year coming to a close this month, June 2019. It may well. In recent years provide any clues it would not be unreasonable to anticipate the cash coffers being larger perhaps by $3 or more million, another $1/share or so. Thus, at the $10 price one gets at least $6.05 in cash and pays $4/share for the whole company. But because because here we are a year later and the company may well have possibly accumulated another$1/share given its trend line of recent years it may any day now have maybe $7 a shares in cash and one can get can get a whole (conservative) company with over $32 million and few liabilities worth mentioning as you can see below, at a cost of just $3 a share. net of cash.

 

 

 

 

 

 

Figures are June 2018

Slowly growing Sales $22,960,146 +3.5% Vs. prior year

 

 

 

Pretax Profits $4,221,282 Pre-Tax Profit Margin 18.4%

 

 

 

Taxes $1,014,600 Tax Rate 24.0%

 

 

 

Net Income $3,206,682 Profit Margin 14.5%

 

 

 

R&D Expense $2,174,268 9.4% of Sales

 

 

 

Total Assets $32.3 million

 

 

 

Total Liabilities $ 2.8 million

 

 

 

Net Worth $29.5 million

 

 

 

 

 

The shares literally trade by appointment and they do not trade in the OTC Pink which has no information on it. None at all. However, on request, if you persevere or I suppose I can make audited statements available one can obtain copies.  That at least is helpful to us as it keeps competition away. It is no wonder the shares when available are so cheap. They trade in the Grey market at the moment. I am well aware VIC members know how to transact oin the Grey market.

 

Need aproval of idea not to be removed from VIC. Should this idea receive sufficient support to remain a member  will be glad to make the A R available on request

 

 

 

 

 

 

 

 

 

 

 

 

 

I do not hold a position with the issuer such as employment, directorship, or consultancy.
I and/or others I advise hold a material investment in the issuer's securities.

Catalyst

 

Value will out. It always does. It could occur in any number of ways e.g. discovery by investors, reregistration with the SEC, sale of the company, merger or acquisition, by public offering or by a going private transaction.

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