Ambertech (ASX:AMO) Thesis Plays Out In FY2022 Results

AV distribution company Ambertech (ASX:AMO) today reported profit of $5.1 million, up 549%.

Back in May, I wrote about Ambertech as a snapshot of a value stock. I said:

At the current price of 22.5 cents, then, it has a market cap of about $17.8m. Add to that net debt of $3m and we get to just under $21m. If we use the normalised profit of $3m then the company is on a P/E of about 7. The most recent director purchase was $23,000 spent on shares at 23 cents. The company has paid out 1.5 cents of interim dividend for the first half, and if it can achieve the same in the next half, then it is trading on a dividend yield of 13%.

Today, by my adjustments, normalised profit was about $2.94m, just as I had expected. Further, it announced another 1.5 cents dividend to bring the full year yield to about 10% at of 30c per share. The stock closed at 32c, and I sold some shares at an average of 30c. I still hold some.

For me, the share price is up about 40% since I bought and I’m looking to sell the rest into any post-results enthusiasm. I think the buyer has every chance of doing well but my updated thesis has played out so I’m going to sell the stock. I explain my thinking briefly, in the video below.

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This is not advice. These are investment notes of mine; not a recommendation. I could have made mistakes in the notes; and I still have many loose ends to explore. I own shares in Ambertech at the time of writing, sold some today, and plan to sell the remainder soon. Please read our detailed disclaimer.