Best China Micro-caps on the Market

[kuwlness]

BSPM almost got to my must-buy point (which is mid $3.40s) ... i cracked and bought at $3.54, but I'm still hoping we get some more sub-$3.50s so we can all load back up. This next run at $4 should break and we'll likely have $4 as support going forward.

Buy the dip, and hope for some $3.40s, that's where I'll be a big buyer again.

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LPIH: started loading back up on this. Could correct back to the low $2s, but this stock wants to go higher. Up-listing next year, looking at .60 EPS in 2011, but 2010 is still up in the air. Potential triple from today's prices, more with an up-listing.

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SKBI: loaded on the big dip into the low $9s (said I bought this pre-market a week or so ago). Was able to fully load up at $8.85ish. Now this is ready to head much higher. You can draw a support line straight across the chart. I feel very comfortable holding this stock until $20.

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ZSTN: reversal doji today, gap filled, and I'm looking for $8.50 over the next week. Easy money IMO. I will wait for next Q earnings to determine fair value, some are speculating $12-16, but next Q will tell the story ... play it for the short-term pop.

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SIAF: Conference Call confirmed for January 5th. News came out at the bell. Lots of potential with this little-known stock. Might consolidate back to low $1s, but expect a big rally going into and after the Con Call.

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CGDI: Buy it if you can get it on the bid (low .30s)

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YUII: over-extended, chart is catching up. There's a gap at $7.60 where I'll be a big buyer, I've unloaded all the shares I was buying sub-$6 over $8 and am waiting patiently to reload.

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CKGT: look to buy more in the $2.40s, most will be big buyers here.

 

[PeterGriffin]

Yessir, Cavalier King Charles Spaniels ... wonderful dogs. I have five adults and five puppies, but only plan on keeping pick of the litter.

Lack of sleep doesnt begin to describe the torture these little monsters have caused me in recent weeks, lol. Puppies tend to want to play when you want to go to bed, and they appear to be nocturnal by nature ... serious, these little monsters are quiet all day, but like to start playing when I lay down.

Anyway, congrats on your new puppy.

Just saw the reply. Thanks kuwlness. You're right, the little one likes to wake us up every morning around 2:30 or 3:00 to go to the bathroom, then wants to get up and stay up around 5 AM. I imagine this is what having a baby is like. lol

Good luck with your investments, and with getting some sleep!

 

[kuwlness]

CKGT


You got 10 minutes to buy this at a huge discount. They're re-stating their financials, clear sign up-listing is in the near future. Don't miss this huge buying opportunity.

 

[kuwlness]

CKGT


You got 10 minutes to buy this at a huge discount. They're re-stating their financials, clear sign up-listing is in the near future. Don't miss this huge buying opportunity.

CKGT Revised Financials:


Today's filings mean the company is one step closer to an uplisting as far as paperwork protocols are concerned.

In 2008, when CKGT share price was much lower than it is today, the company raised capital through the sale of convertible preferred stock and warrants.

As of 3Q 2009 the outstanding preferred stock and warrants were:

Series A Convertible Preferred Stock = 733,333

Warrants = 3,850,000


Consistent with GAAP accounting, the company is treating these instruments as liabilities and marking them to market. When CKGT share price goes up, as it has over the past year and quarter, the fair value of the instruments goes up as well. This registers as an increase liabilities on the balance sheet and a loss against earnings.

Obviously, the loss is not a real loss, just a quirk associated with GAAP accounting. A more accurate--and also more conservative--way to evaluate the earnings would be to add the outstanding warrants and the convertible preferred stock to the diluted shares (basically, assume that they have already been exercised, because eventually they will be), then recalculate the diluted EPS.

If you do that, you get about 24M outsanding shares. Granted, that doesn't account for the cash that CKGT will eventually get from the exercise of the warrants, but we can ignore that to be extra conservative.


Here is their quarterly net income for the past two years:

4Q09 - TBD / 3Q09 - $3M / 2Q09 - $1.42M / 1Q09 - $0.69M

4Q08 - $2.3M / 3Q08 - $1.77M / 2Q08 - $1.04M / 1Q08 - $0.61M


The YOY growth rate has been increasing at a higher rate every quarter of this year. If you assume the same YOY growth rate for 4Q as for 3Q (69%), you get a 4Q net income of $3.89M, an annual net income of $9M, and an annual EPS (using 24M shares) of .375. That's a P/E of 6.9 using today's closing price.

If you assume no growth from 3Q to 4Q, you get an annual net income of $8.11M and an annual EPS (using 24M shares) of .337. That's a P/E of 7.69.

Given the rapid growth (in excess of 50%), the stock is underpriced, even for a chinese small cap.



Buy any additional weakness early next week as some folks might not understand GAAP accounting principles and may become confused.



Merry Christmas RX Forum!! :toast:

 

[kuwlness]

ACLO

Basic reasons to own, especially considering current PPS:


ACLO's Technologies:

DRAM, used in:
1) Digital Video Broadcasting -- Set-top boxes (check ZSTN for revenue increases as this is their primary form of income)
2) Surveillance Systems (hmmm, China & Big Brother go hand-in-hand)
3) Portable DVD Players
4) GPS Units (popular)
5) LCD TVs (hot x-mas item again)
6) Memory for your computers
7) Routers
8) Digital Photo Frames (big x-mas gifts this year)

Flash, used in:
1) GPS Units
2) MP3, MP4, & MP5 players
3) Mobile Phones
4) USB Pen Drives
5) SSD (solid-state drives, gaining popularity fast)
6) Flash Cards (all smart phones use these now)

Graphics, used in:
1) Notebooks
2) VGA Graphics Cards used in PCs and Notebooks



Of course you have the realistic reason being they've done .08 EPS YTD for 2009, and they still have one quarter left to report (which will be in their 10K and this is likely to be released at the end of March, early April).

So, .08 EPS thus far, and I'm guesstimating that they'll come in with at least .02 EPS for the 4th Q (even though I'm looking for .04-.05 EPS for 4th Q), which would put them at .10 EPS for 2009 (conservative estimate). Semi-conductor space gets a healthy PE, and I'd expect ACLO to receive at least a 10PE, which would value them, conservatively, at $1. That's a double from it's most recent close, and I believe 2010 will be an even bigger year for ACLO as SSD (solid-state drives) become more and more popular, and traditional hard drives slowly become phased-out.



I suggest everyone check out their website: http://www.acl-semicon.com/

-- it's slow to load, but has a wealth of knowledge on their products and general information about the company.

 

[PBMULE]

TSTC through the roof!!

Wow!!!!! :smoking: what a run sorry I am out at much lower price....

 

[kuwlness]

Wow!!!!! :smoking: what a run sorry I am out at much lower price....

TSTC is worth $25 IMO. I posted this over a month ago when it was $13. I sold out of TSTC entirely today and will only re-enter around $18. Upside is minimal from here, but it will probably keep running into the new year.

Then agin, it has potential to keep running to $30 or more if earnings are really a blow-out like I think they will be.

Plenty more upside on other stocks that are much cheaper, so from an ROI% TSTC just isnt worth it to hold right now, at least not for me. If earnings arent stellar, it'll sell-off to $16.

 

[kuwlness]

Keep an eye on CHWY, which will begin trading on the Nasdaq tomorrow, which just got announced at the close today. They snuck this one in last week and filed with the SEC to up-list, they did this last week Thursday when no one was looking. Fortunately, I was able to get in, but I didnt recommend the stock here because I wanted more to time to investigate.

Tomorrow, CHWY becomes CWS. I'm looking for $6.50 short-term, and then $8 near-term. Pull-back to $7ish, then re-enter for $9 over the mid-term.


Those are my plans. It closed at $5.48 today. Good quick potential up-side for those with extra christmas money.



I'm also considering re-entering GCHT, which I recommended a while back around $1.75. That thing over-shot itself to $3.40 and needed to rest. If earnings come in, this will probably shoot to $5.50+ ... if earnings are weak, it could head back to $1.80. Up to you guys if you like this one. Plenty others that are less-risky, but this could be a quick double IMO.


Watch for SKBI to break-out to $10.50 in the short-term, could shoot to $11.75. Either way, heading to $20+ when earnings come out.


Sold some SIAF.


CGDI is about to explode IMO, and it moves in large increments of .05-.15 at a time. Should hit at least .70 over the near-term. When this one really gets noticed, I'm looking for $2+ ... it's at .40 now.


NEWN is still looking hot. Not selling until we get a substantial 30% pop. Then sell some and wait for a pull-back. Looking for $13-22 in 2010, all depends on how soon they up-list.


Took most of my JADA position off. I loaded up on this at .33 a few weeks ago and it's already touched .72 a few times. Got an easy double and only keeping a small position to track the stock. Still, it'll probably hit .80 over the near-term.


SGZH ... ticking timebomb, simply a matter of time before it explodes with the other coal stocks. Tick, tock ... tick, tock @)


CCGY ... I think it's finally bottomed and levelled off. Might get an intra-day test of .38-.40, so keep a buy order there. I still think this is heading significantly higher, but it's gonna take time. I still like the stock, I just wish management would wake up and update shareholders with some solid numbers. This will likely under-perform in the short-term, but worth keeping money in IMO.


CHBU is probably worth at least .85. I've been buying at .40 on the bid ... should be able to see at least .60 over the short-term. Earnings could really make it pop.


Probably others I cant think of right now, but that's probably more than enough for the majority of you.

:toast:

 

[ANOTHERDAY]

Keep an eye on CHWY, which will begin trading on the Nasdaq tomorrow, which just got announced at the close today. They snuck this one in last week and filed with the SEC to up-list, they did this last week Thursday when no one was looking. Fortunately, I was able to get in, but I didnt recommend the stock here because I wanted more to time to investigate.

Tomorrow, CHWY becomes CWS. I'm looking for $6.50 short-term, and then $8 near-term. Pull-back to $7ish, then re-enter for $9 over the mid-term.


Those are my plans. It closed at $5.48 today. Good quick potential up-side for those with extra christmas money.



I'm also considering re-entering GCHT, which I recommended a while back around $1.75. That thing over-shot itself to $3.40 and needed to rest. If earnings come in, this will probably shoot to $5.50+ ... if earnings are weak, it could head back to $1.80. Up to you guys if you like this one. Plenty others that are less-risky, but this could be a quick double IMO.


Watch for SKBI to break-out to $10.50 in the short-term, could shoot to $11.75. Either way, heading to $20+ when earnings come out.


Sold some SIAF.


CGDI is about to explode IMO, and it moves in large increments of .05-.15 at a time. Should hit at least .70 over the near-term. When this one really gets noticed, I'm looking for $2+ ... it's at .40 now.


NEWN is still looking hot. Not selling until we get a substantial 30% pop. Then sell some and wait for a pull-back. Looking for $13-22 in 2010, all depends on how soon they up-list.


Took most of my JADA position off. I loaded up on this at .33 a few weeks ago and it's already touched .72 a few times. Got an easy double and only keeping a small position to track the stock. Still, it'll probably hit .80 over the near-term.


SGZH ... ticking timebomb, simply a matter of time before it explodes with the other coal stocks. Tick, tock ... tick, tock @)


CCGY ... I think it's finally bottomed and levelled off. Might get an intra-day test of .38-.40, so keep a buy order there. I still think this is heading significantly higher, but it's gonna take time. I still like the stock, I just wish management would wake up and update shareholders with some solid numbers. This will likely under-perform in the short-term, but worth keeping money in IMO.


CHBU is probably worth at least .85. I've been buying at .40 on the bid ... should be able to see at least .60 over the short-term. Earnings could really make it pop.


Probably others I cant think of right now, but that's probably more than enough for the majority of you.

:toast:

Should I rid my SIAF tomorrow? Thanks

 

[ANOTHERDAY]

Buying on the bid

How do you buy on the bid? I thought you could only buy on the ask. Thanks

 

[kuwlness]

How do you buy on the bid? I thought you could only buy on the ask. Thanks

I'm holding SIAF, but of course I took some off the table, have an average price of .70. Con Call could be sell on news, or rally, if I knew I'd be rich, lol.


As for buying on the bid, I just mean you simply leave a bid open and hope someone sells to you on the bid. Of course this doesnt always work, and sometimes you get left in the dust, other times the bid becomes the ask and you could saved a few more pennies. Just depends on how bad you want in ... but, I rarely pay the ask unless it's a big MoMo play when you just gotta get in regardless.

 

[kuwlness]

BSPM -- boom (sold 50%) -- re-add point is 4/4.10

CWS (CHWY) -- boom (sold at 6.60, re-bought at 6.10 eod) ... buy under $6.20 ... heading to $7.50 near-term

SKBI -- nice little pop (holding all long-term unless we get a big one-day pop) -- try to buy under $9.30 if possible

LPIH -- boom (sold 30% ... most were bought at $2.10 last week). Wait for $2.15ish to re-buy

 

[kuwlness]

While this isnt an economic thread, I am expecting at least a 5% correction in first Q of 2010, but 10% is probably more realistic. I suggest folks take some profits off the table and wait for a nice week-long correction to re-buy their favorites at a discount.

I strongly encourage folks to keep at least 5% cash for the month of january. I will be mostly 10-15% cash and will only use that cash if there are high percentage corrections in the stocks I like the most.


Just throwing in out there, this melt-up into the new year will likely cease in the first week of the new year. Also, we have unemployment next week Friday which I'm anticipating to be much worse than our last job report from earlier in December.

You'll want to buy the weakness on the following Monday, not that Friday.

 

[kuwlness]

CHME ... about to break-out, worth double digits after rADTZ drug is released.


Buy CWS under $6 ... nice discount today.


Also added more GRVY ... about to breakout. $2 cash/share

 

[kuwlness]

XODG

Should be releasing forward guidance any day now. This could easily double from here, one of my favorite stocks for 2010. Just waiting on guidance to increase my position.

 

[kuwlness]

Watch for SKBI to break-out to $10.50 in the short-term, could shoot to $11.75. Either way, heading to $20+ when earnings come out.

Hope you guys listened ... SKBI ... Weeeeeeeee

 

[kuwlness]

ZSTN: reversal doji today, gap filled, and I'm looking for $8.50 over the next week. Easy money IMO. I will wait for next Q earnings to determine fair value, some are speculating $12-16, but next Q will tell the story ... play it for the short-term pop.

ZSTN $8.40 ... I'm out. .10 off, not bad.

 

[Stonesquare]

Hi Kuwl, thx for BSPM, sold recently after the nice ride up. Mostly holding right now, my US tech stocks have been doing nicely.

CHFI and CSGJ - any take on them? JADA had a nice spike but may be heading down for a bit short term IMO. Any way of knowing what kind of hand CHFI is holding since their last report way back when (they certainly don't get good marks for timely updates)?? According to their last holdings they should be up nicely, book value of $1.15 or so, seems like one of those risk/reward gambles we all know and love (lets go Bears!) until it bites us. CSGJ I don't know what to think, their EPS is down and they have a large number of outstanding shares. Wondering if they are dead weight / unload them and move on to greener pastures?

Also: XNYH been eyeing it for a bit, what do you make of it? Its been steady in the mid twenties for a while now, good entry point? SGAS down from its recent spike but still 4x its March lows. On the plus side book value is about $2.2 and earnings have been decent.

*prob. won't make any moves till mid Jan, see which way the wind is blowing

 

[kuwlness]

Hi Kuwl, thx for BSPM, sold recently after the nice ride up. Mostly holding right now, my US tech stocks have been doing nicely.

*prob. won't make any moves till mid Jan, see which way the wind is blowing

Glad you made some $$ on BSPM, that was an easy call. It'll probably hit $6 over the next few months since they're up-listing soon, then I'll have to find the next BSPM ... LTUS is looking like the likely candidate, but they may need to raise cash, so I'm wary of a secondary offering there. I'm still invested in it, but just not as heavily as I'd like to be until I see the next 10Q and how much cash they have.

JADA: I loaded up on this at .33-.35, bought 20k. I've now sold all but 3k of my JADA as 100% in not even a month was enough for me and the MMs let it run so high on light volume because they loaded up there too, so they wanted their easy money. I'm thinking it'll pull-back to .50ish, that's where I'll be a buyer again. If it goes higher, I still have a small position to participate on the up-side.

CHFI: This one throws me for a loop. It basically ran on the China momentum a while back, and I can't believe it hit $1+ ... I didnt sell as much as I shouldve (20/20 vision in hind-sight), and I even bought more around .40 ... it bounced to .55ish, and I unloaded most of my shares. I still hold a small position, but this is a very speculative stock for the reasons you mentioned. Book value according to their most recent filing would be about $1.15 now, but I just hate not being updated in months. So, if you're going to leave money in this one, I'd recommend it only be gambling money or money you're comfortable leaving there as it might not doing anything any time soon.

CSGJ: I'm very disappointed in this one. I had a $2 short-term target, and it actually hit $2 I believe not too long ago before selling off back to $1, now down to .65ish. The EPS down-fall was mostly do to some write-offs and a few other one-time accounting benefits that made their 2008 Q look really good. The potential here is huge, they bought-out one of their competitors and are poised for strong growth over the next few years. But, they dont have much cash after the acquisition and now I'm hearing rumors of a secondary offering. I'm putting this one in the Sell Block for the time being until we get a better idea if they are going to have a secondary offering.

XNYH: I love it, I've loaded up in the low .20s and bought some more at .25. This is a semi-speculative play, but I believe in it. This could easily be a $1 stock next year if earnings come in where I'm projecting. Also, they didnt have to dillute to raise cash ... instead, they were able to get a bank loan, which is huge for a small China company. I'd recommend trying to buy on the bid, but I must admit there arent many sellers. If a .25 ask pops up again, you better slap it quick because I might beat you to it : )

SGAS: I like it, just not invested in it right now. I was trying to buy sub-.70, but some other folks got their hands on it and bought it up too fast. It certainly seems to be in an up-trend. Also, I've been starting to buy more and more companies with more cash on-hand than the current share price. Other examples are: CHCG and GRVY, GRVY being my favorite. So, I'd say if you can get in SGAS sub-.70, it's a great buy. Either way, I'd wait this one out for the time being, lets see the next 10Q and decide then.

 

[UltF]

CYXN!!! Half my shares were triggered to sell at .52 but still have a small core going. Sell it all today and wait for pullback? Or hold for more?

Way to pick that one, Kuwlness.

http://finance.yahoo.com/news/China-Yongxin-Pharmaceuticals-prnews-4081797257.html?x=0&.v=2