Depreciating value!4 Oct 2011 10:57
When the prevailing share price was 21p way back in the days of 54mns issued shares, January 2007, the market cap was around £11.5mns, but that was in the days of huge R&D expenditure, small income, and large losses. But today there are 830mns issued shares and a market cap of some £5mns but the difference between then and now is that large orders are coming in and major cost savings by relocating manufacture abroad, a relatively smaller R&D expenditure needed, most costs sunk in retaining good stock levels and an excellent reputation in its field and the chance of an income explosion with its niche business model. My opinion is that SLG is to be considered undervalued on fundamentals and the erosion of market cap is out of synque with current events. My quess is that the erosion of shareholder value is down to the uncertainty surrounding world wide military budget cutbacks, but this should not be the case as the military et al are increasingly homing in on more accurate GPS positioning and wireless telecommunications, I believe thisstandoff in military and homeland security investment, will be offset by the £Bns of income waiting to be tapped in the personal wireless gadget market as newer devices become available and public demand outstroips supply. SLG are in my opinion poised to announce yet further substantial orders as intimated and alluded in the last communication from Mr Wither.