In business since 2006, Tangiers Investment Group, LLC, is a private equity firm investing in small and micro-cap public companies. With investment funds on hand that can be allocated quickly, Tangiers Investment Group, LLC, has helped launch multiple successful micro-caps.
Analyzing a micro-cap to determine whether it is worthy of investment is similar to the process of analyzing a larger company. As is typical, investors can review the current stock price compared to its 52-week high/low trading range, as well as its stock valuation ratios. They also can look over financial statements, to see how much net profit the company is earning and what debt levels are in relation to available capital.
The difference in evaluating micro-cap companies is many with potential aren't making significant profits yet. Earnings may even be negative, with a deficit in shareholder equity. However, these are often signs a young company is about to experience rapid growth. A savvy micro-cap investor’s focus should be on the company's business strategy and business model, as well as its executive leadership and its competition. These factors give investors a better idea of a micro-cap company’s future than its financials.
