YSXT, YSX Tech. Co. Ltd

Will it survive?

• Can it pay its interest? 14.1×
  Comfortable
  Operating income $4M ÷ interest expense $251K
  What this means

  Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.

• How heavy is the debt, net of cash? $2M · 0.5× operating profit
  Modest net debt
  Cash $0 + ST investments $437K − debt $2M
  What this means

  Netting $437K of cash and short-term investments against $2M of debt leaves $2M owed, about 0.5× a year's operating profit (0.6× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.

• How long is cash tied up? —
  Not enough data
  What this means

  The filing data didn't include the inputs for this check.

Is it a good business?

• Return on invested capital 14%
  Solid through the cycle
  4-yr median, range 8%–32%; 7% latest = NOPAT $3M ÷ invested capital $36M
  Industry peers: median -11%
  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. The headline is the median of the last 4 years (it ran 7% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.

• Owner-earnings margin -3%
  Consumes cash through the cycle
  3-yr median margin, range -9%–-1%; latest ($3M) = operating cash ($3M) − maintenance capex $49K
  Industry peers: median 1%
  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 -3% of revenue this year, a -3% median across 3 years.

• Are earnings backed by cash? -0.96×
  Thinly cash-backed
  Cash from ops ($3M) ÷ net income $3M

  In the filing’s words Read against the cash, reported earnings have run ahead of the operating cash the business generated over the record — about 15% of assets a year, among the widest gaps in the catalogue. For an inventory- or content-heavy grower that can be cash tied up in real assets as it expands; elsewhere it can mean the earnings lean on accounting estimates — the cash-flow statement against the income statement is where to tell which.

  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?

• Where do the earnings go? —
  Not enough data
  What this means

  The filing data didn't include the inputs for this check.

• Investing or harvesting? 1.79×
  Expanding
  Capex $89K ÷ depreciation $49K
  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 Miss
  Revenue ≥ $2B · $83M
  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 Pass
  Current ratio ≥ 2× · 2.79×
  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 Pass
  Debt ≤ working capital · $2M vs $35M 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 $0.16/share (latest year $0.12), the averaged base the calculator's gate runs on, and book value is $1.40/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.

Durability & moat, 2023–2026

Whether the record’s returns held, and what the capital reinvested earned.

• Profitable years 4 of 4
  What this means

  Never lost money over the record, the earnings stability Graham insisted on.

• Operating margin 10% → 5% (2-yr avg ends)
  What this means

  Through the cycle the operating margin slipped — about 10% early to 5% lately, median 7% — competition or costs are biting in.

• Reinvestment, incremental ROIC returns capital
  What this means

  The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.

• Worst year 2026 · 4.2% op. margin
  What this means

  Stayed profitable even in its hardest year, the resilience that survives recessions.

• Share count +5.4%/yr
  What this means

  The share count is rising, dilution works against you on a per-share basis.