SOLITRON DEVICES INC

Where It Passes

Where It Falls Short

• Valuation0% pass✓ 2✗ 26▾

  No clean pass — all 13 investors flag at least one valuation criterion

  Net income / market capitalization+4.66%; #1789/6340 (top 28.2%)

  ✓AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Price / 3-yr avg EPS

  ✗Graham<= 15x

  Price-to-Book Ratio3.2x

  ✗Graham<= 1.5x

  P/E x P/B

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  EBIT / Enterprise Value0.1%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=0.1%, ROC=40.7%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Price / EPS

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)46.2x

  ✗Dreman< 8x

  Price / Book Value per Share3.2x

  ✗Dreman< 1.2x✗Templeton< 1.5x✗SchlossP/B <= 0.80x (app cutoff)

  Valuation ReasonablenessOE Yield=1.7%

  ✗MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF YieldFCF Yield=1.3%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical AverageP/B=3.2x

  ✗MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic Value

  ✗Marks>= 20% below intrinsic value

  Price / FCF per Share61.0x

  ✗Ackman<= 25

  Price vs. Trailing Low249% of trailing low ($14.67)

  ✗Templeton<= 120% of trailing low (certified split-adjusted live window)

  Positive book equity / market capitalization+0.2825; #3769/6449 (top 58.4%)

  ✗AsnessTop 30% of eligible cross-section

  Price / Diluted EPS

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Price / Tangible Book Value per Share3.65x

  ✗SchlossP/TBV <= 1.00x (app cutoff)

  Book Value per Share Change+247.8%

  ✓SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+0.2719; #3460/5247 (top 65.9%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization+4.76%; #1629/4519 (top 36.0%)

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date+40.27%; #808/6202 (top 13.0%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Valuation models0% pass✗ 6▾

  SODI overvalued: all 6 models price fair value below $36.47 (median $9.53)

  Buffett fair value$7.31

  ✗Buffett-398.9% margin vs $36.47

  Greenblatt fair value$5.46

  ✗Greenblatt-567.9% margin vs $36.47

  Munger fair value$11.75

  ✗Munger-210.4% margin vs $36.47

  Pabrai fair value$3.59

  ✗Pabrai-915.9% margin vs $36.47

  Akre fair value$13.67

  ✗Akre-166.8% margin vs $36.47

  Ackman fair value$21.42

  ✗Ackman-70.3% margin vs $36.47
• Verdicts14% pass✓ 2✗ 12▾

  Split decision: 11 FAIL · 3 NEUTRAL · 2 PASS

  Overall verdict

  ✗GrahamFAIL (1/9)✗BuffettFAIL (1/9)✗LynchFAIL (4/7)✗GreenblattRank #1396•PiotroskiNEUTRAL (F-Score 6)✓DremanPASS (5/11)✗MungerFAIL (0/4)✗PabraiFAIL (0/3)✗AkreFAIL (1/6)✗MarksFAIL (3/5)✓AckmanPASS (5/9)✗TempletonFAIL (2/8)•SleepNEUTRAL (4/6)✗AsnessFAIL (Rank #779/2370 (Top 32.9%))✗NeffFAIL (2/6)✗SchlossFAIL (2/7)•OshaughnessyNEUTRAL (Not ranked)
• Debt & Leverage17% pass✓ 4✗ 11▾

  10 of 12 flag SODI's debt & leverage — Graham, Buffett, Lynch +7 more

  LT Debt vs Net Current AssetsLT Debt $3.7B vs NCA $12.7M

  ✗GrahamLT Debt <= Net Current Assets

  Debt/Equity & Interest CoverageD/E: 165.86, IC: 24.1x

  ✗BuffettD/E < 0.5 AND Interest Coverage > 5x

  Total Debt / Equity165.86

  ✗Lynch< 0.33

  Cash - Long-term Debt$-3.7B

  ✗LynchPositive preferred

  LT Debt / Total Assets Change16.03% -> 14.51%

  ✓PiotroskiDecreased YoY

  Current Assets / Current Liabilities4.74

  ✓Dreman> 1.5✓SchlossCurrent ratio >= 1.50x (app cutoff)

  Total Debt / Shareholders' Equity165.86

  ✗Dreman< 0.8✗Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✗SchlossD/E < 1.00x

  Debt Levels165.86

  ✗MungerDebt/Equity < 0.5✗AkreDebt/Equity < 0.3

  Interest Coverage & Debt/EBITDAIC=8.8x, D/EBITDA=1.7x

  ✓MarksInterest Coverage > 3x; Debt/EBITDA < 4x

  Total Debt / Shareholders Equity165.86

  ✗Ackman<= 1.0

  Negative debt-to-equity (higher means less debt)-165.8638; #4208/4210 (top 100.0%)

  ✗AsnessTop 30% of eligible cross-section
• Profitability19% pass✓ 15✗ 20▾

  13 of 16 flag SODI's profitability — Graham, Buffett, Lynch +10 more

  Net income / market capitalization+4.66%; #1789/6340 (top 28.2%)

  ✓AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive EPS (10 years)8/17 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)13/17 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)16.7%

  ✓Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)9.5% (latest)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$1.1M

  ✗BuffettPositive and growing

  Earnings Variance (10-yr CoV)2.18

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR8.9%

  ✓Lynch15-30% (Fast Grower); > 0% to pass

  ROE16.5%

  ✓Lynch> 15%

  EBIT / Enterprise Value0.1%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=0.1%, ROC=40.7%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Net Income / Total Assets3.11%

  ✓PiotroskiROA > 0

  ROA Change YoY3.34% -> 3.11% (delta: -0.22%)

  ✗PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROACFO/Assets=5.20%, ROA=3.11%

  ✓PiotroskiCFO/Assets > ROA

  Gross Margin Change YoY28.4% -> 30.2%

  ✓PiotroskiImproved YoY

  Pre-Tax Income / Revenue23.3%

  ✓Dreman>= 8%

  Net Income / Shareholders' Equity16.5%

  ✓Dreman> 12%

  Margin of SafetyP/B=3.2x

  ✗PabraiP/B < 1.5 or P/E < 15

  Return on Equity14.2% (3-yr avg)

  ✗AkreROE > 20% (3-year avg)

  Discount to Intrinsic Value

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency13/16 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue25.9%

  ✓Ackman>= 15%

  Net Income / Shareholders Equity16.5%

  ✓Ackman>= 15%

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend7.3% (2023) -> 9.5% (2025)

  ✓TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trendgross margin 29.8% -> 30.2%, operating margin 7.3% -> 9.5%

  ✓SleepRevenue rising; gross margin flat or falling; operating margin holding

  Gross profit / total assets+31.28%; #1361/3702 (top 36.8%)

  ✗AsnessTop 30% of eligible cross-section

  Net income / positive book equity+16.50%; #1029/5226 (top 19.7%)

  ✓AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0982; #3454/5884 (top 58.7%)

  ✗AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR-7.1% over 4 years

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years2/5 years positive

  ✗Schloss>= 70% positive over 5-10 observed years (app rule)
• Growth38% pass✓ 8✗ 5▾

  5 of 8 flag SODI's growth — Graham, Lynch, Ackman +2 more

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR8.9%

  ✓Lynch15-30% (Fast Grower); > 0% to pass

  Inventory Growth vs Revenue GrowthInv: 61.6% vs Rev: 62.1%

  ✓LynchInventory growth < Revenue growth

  EPS Growth Direction$0.19 (2007) -> $0.67 (2020)

  ✓DremanPositive over recent years

  EPS CAGR10.2% CAGR over 13 years

  ✓Dreman> 5% annualized

  Positive Net Income Frequency13/16 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth20.8%

  ✓Ackman>= 5%

  Positive EPS Growth Frequency

  ✗AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trendgross margin 29.8% -> 30.2%, operating margin 7.3% -> 9.5%

  ✓SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR10.0%

  ✓SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR-7.1% over 4 years

  ✗Neff7%-20% annualized
• Efficiency38% pass✓ 4✗ 7▾

  5 of 8 flag SODI's efficiency — Buffett, Piotroski, Munger +2 more

  Current Ratio4.74

  ✓Graham>= 2.0

  ROIC (3-5 yr avg)7.8%

  ✗Buffett> 10%

  ROIC - WACC-2.2%

  ✗BuffettPositive (WACC = 10%)

  EBIT / (NWC + Net Fixed Assets)40.7%

  ✓Greenblatt> 25%

  Current Ratio Change YoY5.04 -> 4.56

  ✗PiotroskiIncreased YoY

  Revenue / Total Assets Change YoY0.57x -> 0.65x

  ✓PiotroskiImproved YoY

  Current Assets / Current Liabilities4.74

  ✓Dreman> 1.5

  Return on Invested Capital0.1%

  ✗Munger> 15%

  ROIC (high and growing)FY2023: ROIC=4.3%; FY2024: ROIC=3.6%; FY2025: ROIC=5.4%

  ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each

  Reinvestment Rate x ROIC5.4% (RR=100% x ROIC=5.4%)

  ✗AkreReinvestment Rate * ROIC > 10%

  ROIC (5-year)1/5 years above 12% (latest 5.4%)

  ✗SleepROIC > 12% in a majority of years
• Cash Flow50% pass✓ 7✗ 5▾

  5 of 10 pass — Buffett, Dreman, Pabrai +2 more object

  Free Cash Flow Proxy$1.1M

  ✗BuffettPositive and growing

  FCF Positive and Growing$3.7M

  ✓LynchPositive and growing

  Operating Cash Flow$1.4M

  ✓PiotroskiCFO > 0

  (CFO / Total Assets) vs ROACFO/Assets=5.20%, ROA=3.11%

  ✓PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)46.2x

  ✗Dreman< 8x

  P/E or FCF YieldFCF Yield=1.3%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive10/14 years FCF positive

  ✓MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap6.0%

  ✓Ackman>= 4%

  Price / FCF per Share61.0x

  ✗Ackman<= 25

  Positive Operating Cash Flow frequency14/16 years positive

  ✓SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures$3.7M

  ✓Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization+4.76%; #1629/4519 (top 36.0%)

  ✗OshaughnessyTop 10% of eligible cross-section