diff --git a/index.js b/index.js
index 8e9656f..166edf8 100644
--- a/index.js
+++ b/index.js
@@ -3,10 +3,10 @@ var compile = module.prototype._compile
 var path = require('path')
 
 var index = __dirname.indexOf('node_modules')
-var baseDirectory = (index < 1) ? __dirname : __dirname.substr(0, index - 1)
+var nodeModulesDir = (index < 1) ? path.join(__dirname, 'node_modules') : __dirname.substr(0, index + 12)
 
 module.prototype._compile = function (content, filename) {
-  var isThirdParty = filename.startsWith(path.join(baseDirectory, 'node_modules'))
+  var isThirdParty = filename.startsWith(nodeModulesDir)
   if (!isThirdParty) {
     content = "'use strict';" + content
   }
diff --git a/package.json b/package.json
index 526f019..3078e69 100644
--- a/package.json
+++ b/package.json
@@ -1,6 +1,6 @@
 {
   "name": "auto-strict",
-  "version": "0.0.3",
+  "version": "0.0.4",
   "description": "Add 'use strict'; to all code not in node_modules",
   "main": "index.js",
   "author": {