Friday, August 3, 2007

GSI Technology Inc.

GSI Technology Inc. is a NASDAQ listed security that has been trading in a range between $4.15 and $5.99 over the past year. With 27,594,690 shares outstanding, a recent price of $4.75 gives a total market capitalization of $129,143,144. While there are certainly larger companies, GSI Technology Inc. has definitely earned its place in the pack. Last year, GSI Technology Inc. created $0.33 in earnings for every share outstanding.

GSI Technology Inc. is currently priced by the market at 14.60 times last year’s earnings. Many trading multiples around the world are quite attractive these days, but don’t be fooled. A Price to Earnings ratio of 0 simply means that the security didn’t make any money last year.

With a share price under $50 a share and earnings per share below $1 a share, GSI Technology Inc. could be an interesting value proposition. Consistent earnings are the key to high valuations and this security is well on its way.