Why Value Microcap Stock Rocks?

Why value microcap stock rocks?

Since October 2006, two of my value stocks, AOB and ETLT has increased 50%+ and 30%+ respectively... take a look at the original post written on October 2006 (link and excerpt at the bottom of this article). If I have to explain why AOB and ETLT went up, I would say because of good Q306 result and good potential future (AOB is gaining interest from institutional interest while ETLT is still flying under the radar as institution don't usually invest/cover bulletin board stocks).

Why long term strategy rocks?

AOB 50% return in 3 months sounds great but it's nowhere near the 1000%+ return that you will have from AOB if you purchased about 2 years ago and continue to hold today. I have been accumulating ETLT for almost a year now and I hope in the next 3-5 years I will look back and see that the current 30% quick gain in 3 months will be insignificant (but I can't blame some of my friends who did cash in this 30% gain as any gain is a good gain, plus ETLT could turn out to be a big flop/scam)

So what is the moral of the story?

If you do your DD correctly and buy a great value microcap company (at a reasonable price), all you have to do is to wait patiently while periodically monitoring the progress of your company (making sure the business progress is positive and continually profitable), and don't forget to let the company reach its true potential.

Patience is king!

Sidarta Tanu
Disclosure: This is not a recommendation for an investment. Investment in AOB and ETLT (and similar stocks) are risky and you can lose all your investment. Always do your own due diligence.

AOB October 31st post link ($7.3)
The option ($7.50 leaps) might give a huge potential return (maybe ten-bagger) if the stock goes to $10-$15 in the next 3 years or so (the $5 call option is already too expensive and might as well buy the shares). I've had several ten baggers in the last 6-7 years (but none of them are from options position), and I can say it is a wonderful experience/feeling to hit a ten-bagger (let alone several of them).

ETLT October 16th post link ($.50)
Eternal Technologies (ETLT.OB)
Market Cap: $20M-$22M
Share price: $0.50-.$0.56 (5 days range)
Diluted outstanding: 40M shares
Preferred outstanding: 0
Cash: $30M+ (restricted cash)
Debt: $0Earning: $4M+ (and has been profitable for many years)
Retained earnings: $35M
Sales: $23M
PE = 5P/tangible book < 1