We've all been there: "I bought that stock at $5 and sold for a 60% gain. Now it trades at $22 -- can you believe it?"

Traders say that you never go broke taking a profit. True, but you won't enjoy the benefits of multibagger stock returns if you can't resist selling every time a stock in your portfolio looks too green.

So how do you decide when to cash out and when to hold for more?

Simple. Just imagine you never bought the stock in the first place. Forget what happened since you bought your shares so much lower and watched with glee as they grew and grew. Look at the stock with a cold, sober eye and ask yourself whether you would start a new position at current prices. If you would, don't sell. If you wouldn't, then sayonara, baby. You want a portfolio full of cheap stocks that can still go up, not fully valued slackers.

South African cell phone company MTN (OTC: MTNOY.PK) is one double I won't sell, because it's still cheap enough to buy today. I first bought MTN in the $5 range two years ago. Today it trades for more than $10. Should I sell with a 100% profit? After reading the company's mid-2006 earnings update, I think not.

MTN is a rare combination of value and growth. In South Africa, it competes with Vodacom, a joint venture of state-owned Telkom (NYSE:TKG) and Vodaphone (NYSE:VOD). More important, MTN is aggressively expanding throughout Africa and the Middle East. The company posted 17% year-over-year revenue growth and 27% EPS growth in the first half of 2006 while maintaining its margins. That means it's not discounting its service to gain more subscribers, or spending increasing amounts on marketing to acquire each new user.

MTN sports a trailing P/E between 12 and 13, with another year of 15%-20% growth expected in 2007. Operating cash flow is also very strong, with a price-to-OCF ratio around 12. Debt remains a very reasonable 0.3 of shareholder equity.

MTN's valuation ratios are similar to Vodaphone, with one glaring exception: Vodaphone is struggling to book more growth in its mostly mature markets. MTN expects to continue its 15%-20% expansion for several more years, thanks to its young emerging-market subscriber base and a major acquisition, Dubai-based Investcom.

Many investors dismiss marginal African markets for all the usual reasons. But cell phones are an exception; in countries where fixed-line service ranges from terrible to nonexistent, cell phone coverage can be implemented with a few towers in key locations and satellite links to the international grid. Suddenly, people who could barely communicate with the next village or town are chatting with friends and relatives everywhere. Both the nascent urban middle class and many poorer Africans are signing up for cheap prepaid cell phone service. That trend will continue for many years to come.

South Africa already has a 63% cell phone penetration rate, up from almost nothing 10 years ago. Neighboring Botswana, a diamond-rich democracy now enjoying a huge economic boom, reached 53% recently. But MTN's newer markets have penetration rates ranging from low single digits to the high teens at most. That leaves plenty of room to grow.

Investcom's markets range from 10% to 21% market penetration. The Investcom purchase will double MTN's country markets to 21, filling in more gaps in Africa and expanding the Middle East presence that MTN initiated with a big acquisition in Iran earlier.

A good comparison for MTN is MillicomInternational Cellular (NASDAQ:MICC), a roll-up firm with acquired cell phone operations all over the world. A planned sale of Millicom this summer to a Chinese buyer fell through, and Millicom's stock plunged more than 30%. Since then, the shares have roared back to new highs on the back of another strong growth report from the company.

Millicom is now valued at roughly four times trailing sales and a forward P/E greater than 20. If MTN traded at a similar valuation, it would command a share price of around $13 at the current dollar-to-rand exchange rate. That's before you price in another year of strong growth in 2007.

Like Millicom, MTN could eventually be the target of a bigger player in international telecoms. Merger rumors swirled around the company early in 2006, but MTN subsequently announced that it had broken off talks with an unnamed suitor without a deal. But it seems likely that MTN's growing subscriber base will one day prove hard to resist for a growth-challenged Western operator like Vodaphone.

When people ask me now whether MTN is still a buy, I want to reply with an emphatic yes. I would certainly purchase shares here myself if I didn't already own enough to put MTN in my top three portfolio holdings.

MTN is relatively unknown in the U.S., unlike NYSE-listed South African rival Telkom. But you can buy MTN easily at most brokers with a pink-sheet ADR symbol, MTNOY. Its lack of a listed ADR notwithstanding, the stock still trades very actively on its home exchange in Johannesburg. With a market cap approaching $20 billion, MTN is also the third-largest holding in the South Africa IShare (AMEX:EZA) ETF, and also the third-largest in the Emerging Markets Telecommunications Fund (AMEX:ETF).

MTN may well be a $15-$20 stock next year, based on the numbers. If the valuation model's any guide, there are plenty of reasons to hold this cheap stock, even after a double.

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Fool contributor Dale Baker , a private client portfolio manager and former U.S. diplomat with extensive experience in Europe and Africa, owns shares in MTN for himself and his clients. He welcomes your questions or comments at dabmu@yahoo.com . Vodafone is a Motley Fool Inside Value pick. The Fool's disclosure policy never runs out of minutes.