Share count
11Mpeak FY2025
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MGRT, Mega Fortune Company Limited
IT Services & Consulting asset-light
We are an Internet of Things solution provider in Hong Kong.
Through our IoT platform, tools and services, we help enterprises through their digital transformation, launch IoT initiatives, upscale an existing IoT application or integrate any IoT solution with a legacy system to help them become more innovative, effective and productive.
The business
What it sells, where the money comes from, the kind of company it is.
Revenue · FY2025
$11M
+233.3% YoY
Vital signs · TTM, with 3-yr average
Revenue $11M 3-yr avg $6M
The business in brief
read the 10-K →What this business is and what moves its needle, from its own SEC filings.
- What moves the needle
- Gross margin has run about 51% and operating margin about 17% through the cycle, a wide spread between price and the cost of what it sells — whether that advantage is durable pricing power or a margin that can erode is the question the record is for. That margin has held in a narrow 16%–20% band over the years, so steadiness itself is the evidence — the lever is unit growth and cost discipline, not a moving line. Read this kind of business on retention and the cost of growth. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Every line is arithmetic on the company's filings, shown in full in the sections below.
The record
Ten years of arithmetic, read across the cycle.
The record, 2023–2025
realized figures from each filing · older years to the left| 2023’23 | 2024’24 | 2025’25 | TTMTTMSep 2025 | |
|---|---|---|---|---|
| Income statement | ||||
| $3M | $3M | $11M | $11M | RevenueRevenue |
| 39% | 54% | 51% | 51% | Gross marginGross mgn |
| $553K | $545K | $2M | $2M | Operating incomeOp. inc. |
| 17.0% | 16.4% | 20.3% | 20.3% | Operating marginOp. mgn |
| $537K | $402K | $2M | $2M | Net incomeNet inc. |
| 13% | 30% | 23% | 23% | Effective tax rateTax rate |
| Cash flow & returns | ||||
| ($33K) | ($100K) | ($12M) | ($12M) | Operating cash flowOp. cash |
| $7K | $5K | $3K | $3K | DepreciationDeprec. |
| ($576K) | ($506K) | ($14M) | ($14M) | Working capital & otherWC & other |
| $2K | $7K | — | $7K | CapexCapex |
| 0.1% | 0.2% | — | 0.1% | Capex / revenueCapex/rev |
| ($34K) | ($105K) | — | ($12M) | Owner earningsOwner earn. |
| −1.1% | −3.1% | — | −108.3% | Owner earnings marginOE mgn |
| ($34K) | ($107K) | — | ($12M) | Free cash flowFCF |
| −1.1% | −3.2% | — | −108.3% | Free cash flow marginFCF mgn |
| — | 39% | 11% | 11% | ROICROIC |
| — | 30% | 11% | 11% | Return on equityROE |
| — | 30% | 11% | 11% | Retained to equityRetained/eq |
| Balance sheet | ||||
| — | $372K | $765K | $765K | Cash & investmentsCash+inv |
| — | $2M | $6M | $6M | ReceivablesReceiv. |
| — | $21K | $304K | $304K | Accounts payablePayables |
| — | $2M | $6M | $6M | Operating working capitalOper. WC |
| — | $3M | $12M | $12M | Current assetsCur. assets |
| — | $2M | $3M | $3M | Current liabilitiesCur. liab. |
| — | 1.7× | 4.9× | 4.9× | Current ratioCurr. ratio |
| — | $3M | $18M | $18M | Total assetsAssets |
| — | — | $662K | $662K | Total debtDebt |
| — | — | ($103K) | ($103K) | Net debt / (cash)Net debt |
| — | $1M | $16M | $16M | Shareholders’ equityEquity |
| Per share | ||||
| 10.0M | 10.0M | 10.8M | 13.8M | Shares out (diluted)Shares |
| $0.32 | $0.33 | $1.03 | $0.81 | Revenue / shareRev/sh |
| $0.05 | $0.04 | $0.17 | $0.13 | EPS (diluted)EPS |
| $-0.00 | $-0.01 | — | $-0.87 | Owner earnings / shareOE/sh |
| $-0.00 | $-0.01 | — | $-0.87 | Free cash flow / shareFCF/sh |
| $0.00 | $0.00 | — | $0.00 | Cap. spending / shareCapex/sh |
| — | $0.14 | $1.44 | $1.13 | Book value / shareBVPS |
The record, charted
FY2023–2025Each measure over its full record; the current point and the worst year marked.
Gross margin
51%low FY2023
Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.
In fiscal 2024 the business earned ($105K) of owner earnings, the operating cash left after the $5K it takes just to hold its position. It put $3K more into growth; free cash flow, after that spending, was ($107K).
| FY2024 | FY2023 | |
|---|---|---|
| Reported net income | $402K | $537K |
| Depreciation & amortizationnon-cash charge added back | +$5K | +$7K |
| Working capital & othertiming of cash in and out, other non-cash items | −$506K | −$576K |
| Cash from operations | ($100K) | ($33K) |
| Maintenance capital expenditurethe spending needed just to hold position and volume | −$5K | −$2K |
| Owner earnings | ($105K) | ($34K) |
| Growth capital expenditurediscretionary; spent to get bigger, not to stand still | −$3K | — |
| Free cash flow | ($107K) | ($34K) |
| Owner-earnings marginowner earnings ÷ revenue | -3% | -1% |
Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $5K, roughly its depreciation, the rate its assets wear out). The other $3K of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows.
Much of fiscal 2024's profit didn't arrive as operating cash; it sits in “working capital & other” above. That can be a real inventory or timing swing, or profit that doesn't run through operating cash at all: a heavy tax year, equity-method earnings, or investment income booked through investing. For a year like this, owner earnings understates the cash earned; the full cash-flow statement carries the rest.
Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.
Quality & stewardship
Returns, the balance sheet, capital allocation, and pay.
Owner’s Scorecard
FY2025 20-F · source on SEC EDGAR →
Will it survive?
- No meaningful interest burdenLittle or no interest expense reported
What this means
Little or no interest expense reported, the business isn't leaning on lenders to operate.
- Net cashCash $765K − debt $662K
What this means
Cash and short-term investments exceed every dollar of debt by $103K, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
- Long (60+ days)DSO 205 + DIO 0 − DPO 20 days
What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash. (Little or no inventory, a services / asset-light model, so the inventory leg is ~0.)
Is it a good business?
- SolidNOPAT $2M ÷ invested capital $15M (debt + equity − cash)Industry peers: median -18%
What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
- Owner-earnings margin -108%Consumes cashOwner earnings ($12M) = operating cash ($12M) − maintenance capex $3KIndustry peers: median -500%
What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's -108% of revenue this year.
- Are earnings backed by cash? -6.71×Thinly cash-backedCash from ops ($12M) ÷ net income $2M
What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.
How is the cash used?
- Not enough data
What this means
The filing data didn't include the inputs for this check.
- Investing or harvesting? 2.23×ExpandingCapex $7K ÷ depreciation $3K
What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.
Graham’s defensive tests · 2 of 3 met
Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.
- Adequate size MissRevenue ≥ $2B · $11M
What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
- Strong liquidity PassCurrent ratio ≥ 2× · 4.88×
What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
- Conservative debt PassDebt ≤ working capital · $662K vs $10M WC
What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
- Moderate price —P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $0.07/share (latest year $0.13), the averaged base the calculator's gate runs on, and book value is $1.13/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.
Does AI threaten the moat?
Elevated contestabilityThe product is software or information, the very thing capable AI now produces more cheaply, so the moat is more contestable than the record alone implies.
In its own filing Raised, but not as a competitor
The filing raises AI among its risks, but in other terms (security, regulation, energy or the like), not as a competitor to its product; it frames AI mainly as a capability.
AI has collapsed the cost of building a capable substitute for the very thing this business sells. When a credible alternative can be assembled for a fraction of the incumbent's price, it is pricing power that erodes first, not revenue tomorrow. The live question is whether the moat survives that, not whether it held in the past. Whether that question is answerable at all is yours to decide, against your own circle of competence.
Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.
All figures as filed; the source filing is linked above.
Current Position
as of fiscal year-end, Sep 30, 2025Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.
Current assets$12M
- Cash & short-term investments$765K
- Receivables$6M
- Other current assets$5M
Current liabilities$3M
- Accounts payable$304K
- Other current liabilities$2M
Current ratio4.88×all current assets ÷ what's due · Graham looked for 2×
Quick ratio4.88×stricter: inventory excluded
Cash ratio0.30×strictest: cash alone against what's due
Working capital$10Mthe cushion left after near-term bills
Cash runway0.1 yrsthe business is consuming cash; this is how long the cash on hand lasts at that rate
Deeper floors
Tangible book value$16Mequity stripped of goodwill & intangibles
Net current asset value$9MGraham's net-net: current assets less all liabilities
Debt incl. operating leases$700K$39K of it operating leases
Deferred revenue$22Kcustomer cash collected before delivery; operating float
From the company's latest filing.
Peers, IT Services & Consulting
The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.
| Company | Revenue | Gross margin | Op. margin | ROIC | Owner earn. margin |
|---|---|---|---|---|---|
| QXLQuantum X Labs Inc. | $27M | 95% | -9.4% | -2% | 3% |
| QBTSD-Wave Quantum Inc. | $25M | 68% | -724.6% | -1142% | -582% |
| GEGGLGreat Elm Group, Inc. | $16M | 93% | -46.5% | -12% | -3% |
| NXTTNext Technology Holding Inc. | $12M | 59% | -24.0% | -1% | -29% |
| MGRTMega Fortune Company Limited | $11M | 51% | 17.0% | 11% | -108% |
| PDYNPalladyne AI Corp. | $5M | 30% | -916.4% | -333% | -500% |
| DJTTrump Media & Technology Group Corp. | $4M | 55% | -3360.9% | -18% | -943% |
| ODYSOdysight.ai Inc. | $3M | 29% | -593.1% | -442% | -584% |
| Group median | — | 57% | -319.8% | -15% | -304% |
The price
What a price has to assume.
What the price implies
reverse-DCFEnter the US price, in dollars: the NYSE/Nasdaq quote you hold. Mega Fortune Company Limited's US listing is the ordinary share itself. The record tables elsewhere on this page remain as filed.
Mega Fortune Company Limited is profitable, but owner earnings are negative this year because capital spending currently outruns operating cash, a build-out, so the owner-earnings reverse-DCF has no positive base to grow. We read the price from both ends instead: type a price to see the steady-state profitability it demands, then set the mature margin you would believe and weigh the two against each other. Nothing leaves your browser unless you enter it in your notebook.
$
The assumptions
Enter a price to run it.
Owner earnings it must reach—
Margin the price demands—
Owner-earnings margin today−108%
A dated snapshot of the price you typed, the assumptions you set, and what the page showed for them. A snapshot is never edited after it is saved. Your notebook is yours alone — the commitment states what is stored and what we will never do.
Two reads of one future. From your price: the owner earnings the company must reach, valued at a mature multiple and discounted back at your rate, expressed as the margin it implies on revenue grown at your rate. From your belief: the mature margin you would credit, set on the dial above. When the margin the price demands runs above the one you would believe, you are paying for a future taken on faith. For a deep cyclical at a trough, normalized through-cycle earnings are the better lens; this mode is for the genuinely unprofitable, and for the profitable business whose capital spending currently outruns its cash.
Cite: Owner Scorecard, "Mega Fortune Company Limited (MGRT), the owner's record," https://ownerscorecard.com/c/MGRT, data as of 2026-07-09.
Manual order: ← MGA its page in the Manual MICC →
Industry order: ← MFI the IT Services & Consulting chapter MOVE →