Buying This Boring Company With 10X Potential!
"Simple, boring, small" is a recipe for multi-baggers in investing. I have found such a micro-cap that can easily make 10x in the next decade!
Many people think there are two types of investing: Value and growth.
If you are a value guy, you are defensive; if you are a growth guy, you are offensive. You can’t have them both.
This couldn’t be far from the truth.
You can definitely be a defensive growth investor, which is best of the both worlds. The pinnacle of this is Peter Lynch.
He is probably the first investor that comes to mind when you think about growth investing. The guy compounded at 29% annually for 13 years.
Yet, he didn’t play the obvious offense, i.e, he didn’t buy sexy software companies that had potential to scale to infinity.
No, he bought boring businesses with ridiculous names that usually traded below 20 times earnings. He played defense and scored through counter attacks. His picks didn’t just have large upside potential, but also had very little downside potential.
His three rules for winning stocks were:
It’s in a no-growth industry.
It sounds dull – or even better, ridiculous.
Institutions don’t own it and analysts don’t follow it.
This way you can minimize your downside by maximizing your upside at the same time.
Lynch could have outperformed the market for a year by buying the hottest software, instead, he played defensive, bought boring businesses, and outperformed for 13 years.
Today, I am introducing you a business that squarely fits Lynch’s criteria:
It is a fast grower in a slow growing industry.
Only 7% of it is owned by institutions.
It definitely sounds ridiculous.
It grew revenues nearly 3x since 2023 and it’s still a $100 million company. It just has $2 million long-term debt against $35 million equity. Management is expanding the operations.
Best? It trades at just 16 times earnings.
Given the market opportunity, this company can easily do 5-10x without executing to perfection.
So… Let’s cut the BS and dive deep into it!