am i missing something?, page-2

Yep, have been a very happy holder in this one since September last year (got in at $3.57). My only regret is not buying substantially more even though i had very high conviction on this company at the time.

It ticks every box i look for:
- Open, plain talking and honest management who are very heavily invested in the company (Darryl Holmes owns 60%+ of the company hence low liquidity) and are working in the interests of shareholders rather than themselves (he pays himself a low salary and is purely focused on increasing dividends and EPS)
- Simple business model which will be robust in any economic environment (people will always go to the dentist)
- Not capital intensive (Holmes hates issuing new shares so dilution is minimised, and is very conservative on debt)
- Sustainable, high returns ($7m NPAT this year would give ~28% ROE - they have achieved consistently high ROE since listing)
- Solid dividend (they only retain capital where it is needed for investment in high returning organic growth)
- Opportunities for growth (they're only in Queensland, heaps of opportunities to grow interstate)

This is *the* favourite company in my portfolio and i plan on being a very long term holder if Holmes keeps operating the business as he has done since its listing.

I would love to buy more at some point in the future but it is very fully priced at the moment (overpriced, in my opinion) - i am guessing they will do around $7m NPAT this year which puts them on a current PE of about 20 times. I suspect a big part of the reason the price has driven up so rapidly is because they have reached $100m market cap which puts them on the radar of small cap fund managers. The small cap managers have seen that this is a very high quality business, have tried to buy in, but because there is very little liquidity the price has shot up.

Like i said, this is a bottom drawer stock for the long term. Investing would be a lot easier if there were more companies like this one, and more managers like Holmes.