if you check SEC filling of HNR
Besides our very predictable and diligent buyer: Pabrai, the new impression is everyone in the company management is aquiring shares dated May 17th. Usually after getting such 0 cost shares, insiders will immediately dump them to the open market to enjoy the quick cash. Check Sec form 4 fillings from company like CRM.
What does this mean? Our party time is approaching, the management of HNR is making sure everyone on board to have a piece of pie to enjoy. Hopefully I still get time to play bigger fool game in China when the news is announced.
Showing posts with label Individual Stock Comment. Show all posts
Showing posts with label Individual Stock Comment. Show all posts
Saturday, May 26, 2007
Wednesday, May 23, 2007
OVTI Strong buy
Today's news is HUGE.
As an investor this is a strong buy, as a trader, you may want to confirm it after May 31st ER.
As an investor this is a strong buy, as a trader, you may want to confirm it after May 31st ER.
Monday, May 21, 2007
我和疯猫(MCZ)间不得不说的故事
第一次听说MCZ是二月来自法师(zzpt@mitbbs)的站内邮件，他告诉我他读了报表，看了forum,了解到CEO开始谈论profit bonus，那时analyst预计亏损，开始谈profit bonus是个不寻常的现象，当时pps=0.61, 他估计自己0.62还是0.63买的，我等到ER当天，0.64买的，这个是完全基于对法师FA能力的信任，他自己很少喊赌ER,所以他喊你一定要听。
最后结果很好，eps=+0.07,最重要的是margin大涨，这里有关于那次ER和疯猫基本面的简单讨论。
最近学习TA,这个0.62-0.64的买点刚好能用trendline做出来，所以是个旁证,为什么我说FA,TA本是一家，为什么要分彼此.
之后MCZ沉寂了一段，我一直有利润，慢慢捂，最近的突然拉升是Halo3 news driven,这个你如果没跟上，也无所谓，我在MCZ快到1的时候喊了到$1搏傻。
各位TA高手如果熟悉Jesse Livermore,一定知道他的整百追高法，其实这个$1也是一样，是一个非常重要的心理关口.
但是我误算了一步，就是第一下冲过$1后有回来再确认的需求，所以致使一位忠实读者被stop out, my mistake, 今天再上$1，开始奔就是很明显的事情了，这个先回调一下再break out的道理就是TA教科书上说的"cup and handle"一个道理，虽然这个cup,handle形状都不标准，但是这个炒家心理是一样的，触类旁通而已，所以这个$1搏傻基本上是一个心理搏傻。
至于今天的1.12 buy on dip,就是纯TA了， 50% retracement,没什么好说的。MCZ trendline清晰可见，还是很好做的。
一句话，炒股不要钻牛角尖，各种方法都是相互贯通的。正所谓华山气剑二宗都是一个祖师爷传下来的，何苦非要分个彼此喃，充分发挥自己的长处也不要忽视了各种方法背后相通的道理，我写过的君子不器和处长胜人可以给这个疯猫故事做个注脚
最后结果很好，eps=+0.07,最重要的是margin大涨，这里有关于那次ER和疯猫基本面的简单讨论。
最近学习TA,这个0.62-0.64的买点刚好能用trendline做出来，所以是个旁证,为什么我说FA,TA本是一家，为什么要分彼此.
之后MCZ沉寂了一段，我一直有利润，慢慢捂，最近的突然拉升是Halo3 news driven,这个你如果没跟上，也无所谓，我在MCZ快到1的时候喊了到$1搏傻。
各位TA高手如果熟悉Jesse Livermore,一定知道他的整百追高法，其实这个$1也是一样，是一个非常重要的心理关口.
但是我误算了一步，就是第一下冲过$1后有回来再确认的需求，所以致使一位忠实读者被stop out, my mistake, 今天再上$1，开始奔就是很明显的事情了，这个先回调一下再break out的道理就是TA教科书上说的"cup and handle"一个道理，虽然这个cup,handle形状都不标准，但是这个炒家心理是一样的，触类旁通而已，所以这个$1搏傻基本上是一个心理搏傻。
至于今天的1.12 buy on dip,就是纯TA了， 50% retracement,没什么好说的。MCZ trendline清晰可见，还是很好做的。
一句话，炒股不要钻牛角尖，各种方法都是相互贯通的。正所谓华山气剑二宗都是一个祖师爷传下来的，何苦非要分个彼此喃，充分发挥自己的长处也不要忽视了各种方法背后相通的道理，我写过的君子不器和处长胜人可以给这个疯猫故事做个注脚
Saturday, May 19, 2007
Update on HNR
Weekend Read, StokBlogs-HNR
I think he followed VIC article.
An overlooked conference call news
The most import message:
"
...
Even so, Harvest is moving ahead with development plans because, Edmiston said, "the government is behaving in a way that suggests they are 100% committed to what we've laid out. I think what we're doing, moving ahead with the business, reflects our own view reflecting certainty or uncertainty."
Harvest has put out bids for two drilling rigs, which it expects to receive over the summer, and has already secured two workover rigs, as well as increasing its technical staff, Edmiston said. PDVSA agreed to foot the bill for some equipment that Harvest has ordered for PetroDelta, Edmiston said.
Harvest expects the business plan to "build production rapidly" and increase reserves, he said.
...
"
I have listened the CC webcast twice, I know this is for real. :)
I think he followed VIC article.
An overlooked conference call news
The most import message:
"
...
Even so, Harvest is moving ahead with development plans because, Edmiston said, "the government is behaving in a way that suggests they are 100% committed to what we've laid out. I think what we're doing, moving ahead with the business, reflects our own view reflecting certainty or uncertainty."
Harvest has put out bids for two drilling rigs, which it expects to receive over the summer, and has already secured two workover rigs, as well as increasing its technical staff, Edmiston said. PDVSA agreed to foot the bill for some equipment that Harvest has ordered for PetroDelta, Edmiston said.
Harvest expects the business plan to "build production rapidly" and increase reserves, he said.
...
"
I have listened the CC webcast twice, I know this is for real. :)
Update on ACUS
Zack's Report
Although I don't think he is an expert in this field, however I agree with most of what he thinks on ACUS.
"
...
So you’re seeing a buying opportunity here. You’ve got a Buy recommendation on the stock, I take it?
Absolutely. It was off over 30% after the data came out, and I think that was kind of a knee-jerk panic reaction. But if you actually see the differences between an Imagify ultrasound, a regular ultrasound and nuclear, I think you could lean towards feeling like Imagify ultrasound is the way to go. It seems to be the best tool for detecting disease.
What is your price target for the next six months or so?
It might be hard to get there is six months, but we see $5.00 as fair value, and we think the stock could go above $5.00 on FDA approval. They’re probably going to file in the next six months, and that could act as a catalyst. Then we’ll hear from the FDA sometime in 2008, and if the FDA approves, we see $5.00 or higher as where the stock is going.
...
"
PPS=$5 only gives market cap <200M, for a drug which can bring about $400-500M revenue annually (although CEO claims $2billion market I don't buy it), this is a very conservative estimation. However the assumption here, it will get FDA approval, and the possibility of failing so is really low IMHO.
Although I don't think he is an expert in this field, however I agree with most of what he thinks on ACUS.
"
...
So you’re seeing a buying opportunity here. You’ve got a Buy recommendation on the stock, I take it?
Absolutely. It was off over 30% after the data came out, and I think that was kind of a knee-jerk panic reaction. But if you actually see the differences between an Imagify ultrasound, a regular ultrasound and nuclear, I think you could lean towards feeling like Imagify ultrasound is the way to go. It seems to be the best tool for detecting disease.
What is your price target for the next six months or so?
It might be hard to get there is six months, but we see $5.00 as fair value, and we think the stock could go above $5.00 on FDA approval. They’re probably going to file in the next six months, and that could act as a catalyst. Then we’ll hear from the FDA sometime in 2008, and if the FDA approves, we see $5.00 or higher as where the stock is going.
...
"
PPS=$5 only gives market cap <200M, for a drug which can bring about $400-500M revenue annually (although CEO claims $2billion market I don't buy it), this is a very conservative estimation. However the assumption here, it will get FDA approval, and the possibility of failing so is really low IMHO.
Update on SIGA
Now we have a complete story to tell about the kid.
"...
“He looked like he was going to die,” Dr. Kahana recalled.
The doctors worked with the Food and Drug Administration to allow the use of an experimental drug for smallpox, ST-246, from Siga Technologies, which appeared to begin turning the case around.
..."
and He "has recovered", what a happy ending.
I really don't care about how long I have to wait to see the sizeable return from holding SIGA. I feel lucky to find this company and feel comfortable holding it. The price movement can be volatile, however I know the downside risk holding SIGA is really low.
I just love such stocks with seemingly high risk(due to high volatility) but actual low risk. It really creates a lot of great investing opportunities.
Update:
SIGA may actually go lower the next week. I just know it.
"...
“He looked like he was going to die,” Dr. Kahana recalled.
The doctors worked with the Food and Drug Administration to allow the use of an experimental drug for smallpox, ST-246, from Siga Technologies, which appeared to begin turning the case around.
..."
and He "has recovered", what a happy ending.
I really don't care about how long I have to wait to see the sizeable return from holding SIGA. I feel lucky to find this company and feel comfortable holding it. The price movement can be volatile, however I know the downside risk holding SIGA is really low.
I just love such stocks with seemingly high risk(due to high volatility) but actual low risk. It really creates a lot of great investing opportunities.
Update:
SIGA may actually go lower the next week. I just know it.
Friday, May 18, 2007
Update on ASPV
in this seeking alpha article
"...
Right now ASPV is in the low $19s, which is approximately 10% above our cumulative discounted cash flow estimate for FY2007-2009; essentially, the market is pricing in almost no chance of Aspreva making another successful deal.
...
"
Sounds very familiar, right?
It is that simple, if you can see the value, someone else can see it, it is just a matter of time for the whole market to catch up. and the time delay really depends on how famous is the name, and how big is the uncertainty. Therefore I love underknown names with seemingly high uncertainty however actual low downside risk.
I think I should do more research on AMGN, since it is now clearly in the HCL wonderland.
"...
Right now ASPV is in the low $19s, which is approximately 10% above our cumulative discounted cash flow estimate for FY2007-2009; essentially, the market is pricing in almost no chance of Aspreva making another successful deal.
...
"
Sounds very familiar, right?
It is that simple, if you can see the value, someone else can see it, it is just a matter of time for the whole market to catch up. and the time delay really depends on how famous is the name, and how big is the uncertainty. Therefore I love underknown names with seemingly high uncertainty however actual low downside risk.
I think I should do more research on AMGN, since it is now clearly in the HCL wonderland.
Thursday, May 17, 2007
Tessera Technology (TSRA) , OVTI and MU
At this point, my only concern about OVTI's future is this company, I have been following it since before last ER, and made nice profit after ER.
After listening today's shareholder conference, I would suggest any serious OVTI investors to have a close look at this company, and our main focus is not MU, Samsung or Toshiba. It is Tessera.
I have explained OVTI's turning around will be depending on TSRA's technology. So far I have been focusing on the manufacturing yield benefit from TSRA's WLCSP techonology
Let's take a further look into future. We all know that TrueFocus is going to be a blockbuster for OVTI's business in 2008 and beyond. What does this have anything to do with TSRA?
TrueFocus is a camera system, OVTI has the expertises to design (and already did)two of the three components: the image sensor, and the image processor(DSP), so what is the missing part? It is easy to find out.
The optical part, the counterpart to the traditional lens. Why is this an issue?
The point is you want to make it cheap,really really cheap, make it small, and really really small and slim. So It needs TSRA's wafer level optical(WLO).
That is why OVTI needs TSRA, the reasons above arenot very obvious, however very important. In my mind, TSRA and TSMC are the two legs of OVTI, without any of them.it cannot walk and run let along flying high.
So far in this analysis, TSRA is OVTI's friend. and OVTI will be the first in the industry to enjoy the full benefit of TSRA's so called Wafer Level Camera Ecosystem.
However it is not that simple, since TSRA actually wants a piece of pie in the market OVTI, MU are fiercely fighting now by acquiring a small company called EyeSquad who develops software autofocus and zoom similar as TrueFocus. By doing so, TSRA has got all the important pieces to compete in the incoming market.
My educated impression is EyeSquad is not as good as WFC(TrueFocus), their technology is based on Fresnel lens, image quality compromise will be the #1 concern , and they don't really have the track record as OVTI in image sensor business, the best they can show now is a VGA module, and at that resolution you don't really need digital autofocus.
I have seen signs of benign relationship between OVTI and TSRA, especially in the process of adapting TSRA's WLCSP and WLO. However we really cannot overlook the issue of EyeSquad. TSRA is strong in the system to module level know-how in every aspect of this type of camera, once EyeSquad makes good progress to catch up, Tessera will be a formidable player in this field, and certainly a potential threats to OVTI.
What does this mean to our OVTI investors holding strong belief of the booming market? I would say sparing 20%-30% of funds you would like to pour in OVTI to get some TSRA shares. I believe both of them will do great in 2007. However it is just a matter of time for us to know who will be the final winner. If they can merge together, that will be THE company I feel comfortable putting 100% of my fund investing, however the world is not ideal. I cannot always get what I want.
BTW forget about MU in this market, up to date, they have no progress at all for digital autofocus to respond Truefocus, and they are not interested in adapting WLCSP and WLO to boost yield while getting smaller and slimmer camera modules, since doing that means more capital expenditure on their depreciated old Fabs, why would they do that if utilizing old Fabs is the sole reason for them to entering this market in the first place. To make things worse their chips are not selling well.
In MU's most recent CC in April, the recorded transcript reads:
"CMOS image sensors sales are down due to market share loss, shift to low-end phones in the market and pricing pressure. Image sensor market will remain challenging with current sensor inventory at MU over one quarter and it will take until the end of the fiscal year to work off."
So MU is not going to be the winner in the foreseeable future, simply because they don't have the right business model for the competition here in CIS market.
Update:
More info about where did WLO come from.
And very insightful comment from a forum post
After listening today's shareholder conference, I would suggest any serious OVTI investors to have a close look at this company, and our main focus is not MU, Samsung or Toshiba. It is Tessera.
I have explained OVTI's turning around will be depending on TSRA's technology. So far I have been focusing on the manufacturing yield benefit from TSRA's WLCSP techonology
Let's take a further look into future. We all know that TrueFocus is going to be a blockbuster for OVTI's business in 2008 and beyond. What does this have anything to do with TSRA?
TrueFocus is a camera system, OVTI has the expertises to design (and already did)two of the three components: the image sensor, and the image processor(DSP), so what is the missing part? It is easy to find out.
The optical part, the counterpart to the traditional lens. Why is this an issue?
The point is you want to make it cheap,really really cheap, make it small, and really really small and slim. So It needs TSRA's wafer level optical(WLO).
That is why OVTI needs TSRA, the reasons above arenot very obvious, however very important. In my mind, TSRA and TSMC are the two legs of OVTI, without any of them.it cannot walk and run let along flying high.
So far in this analysis, TSRA is OVTI's friend. and OVTI will be the first in the industry to enjoy the full benefit of TSRA's so called Wafer Level Camera Ecosystem.
However it is not that simple, since TSRA actually wants a piece of pie in the market OVTI, MU are fiercely fighting now by acquiring a small company called EyeSquad who develops software autofocus and zoom similar as TrueFocus. By doing so, TSRA has got all the important pieces to compete in the incoming market.
My educated impression is EyeSquad is not as good as WFC(TrueFocus), their technology is based on Fresnel lens, image quality compromise will be the #1 concern , and they don't really have the track record as OVTI in image sensor business, the best they can show now is a VGA module, and at that resolution you don't really need digital autofocus.
I have seen signs of benign relationship between OVTI and TSRA, especially in the process of adapting TSRA's WLCSP and WLO. However we really cannot overlook the issue of EyeSquad. TSRA is strong in the system to module level know-how in every aspect of this type of camera, once EyeSquad makes good progress to catch up, Tessera will be a formidable player in this field, and certainly a potential threats to OVTI.
What does this mean to our OVTI investors holding strong belief of the booming market? I would say sparing 20%-30% of funds you would like to pour in OVTI to get some TSRA shares. I believe both of them will do great in 2007. However it is just a matter of time for us to know who will be the final winner. If they can merge together, that will be THE company I feel comfortable putting 100% of my fund investing, however the world is not ideal. I cannot always get what I want.
BTW forget about MU in this market, up to date, they have no progress at all for digital autofocus to respond Truefocus, and they are not interested in adapting WLCSP and WLO to boost yield while getting smaller and slimmer camera modules, since doing that means more capital expenditure on their depreciated old Fabs, why would they do that if utilizing old Fabs is the sole reason for them to entering this market in the first place. To make things worse their chips are not selling well.
In MU's most recent CC in April, the recorded transcript reads:
"CMOS image sensors sales are down due to market share loss, shift to low-end phones in the market and pricing pressure. Image sensor market will remain challenging with current sensor inventory at MU over one quarter and it will take until the end of the fiscal year to work off."
So MU is not going to be the winner in the foreseeable future, simply because they don't have the right business model for the competition here in CIS market.
Update:
More info about where did WLO come from.
And very insightful comment from a forum post
Plain fact about MPEL and their Crown Macau
On May 12th Crown Macau finally opened, 15 days after the initial estimation (April 27th) made on the IPO day, and 4 days after the second estimation (May 8th), missed the Golden May Weekend. That's it, it was eventually there, a not very timely execution, you may wonder why it plummeted so much to make lower lows everyday. Today it actually touched $13.61, which was a 28.5% retreat from its IPO price $19. And it was considered sizzling hot IPO then.
Here is why, it is really not about the 15 days or 4 days delay, it is about the confidence of the investors on management ability to run the first 6-star casino ever built on that island.
So what is missing from the openning?
Let's get the fact straight, from the recent conference call
Crown opened with
26 VIP table vs. 80 planned 32.5%
142 premium mass tables, vs 142 planned 100%
479 gaming machines vs 550 planned 87.1%
"the additional 54 VIP gaming tables and 71 gaming machines will be operational within approximately four weeks."
let's do a quick estimation, if every time unit each gaming machine makes $1, premium mass table makes $10, VIP table makes $100, which is just a rough estimation, every time unit, under full occupancy they are planning to make $9970, for the first 4 weeks, they are only going to make 26*100+142*10+479= $4499, which is roughly 45% of the planned profitbility.
So their first month report will be a huge disappointment, since they simply don't have the capacity ready.
This is not the only problem, their real problem is the hotel room.
"Crown Towers hotel will be operational with approximately 60 rooms available within three weeks. Approximately 216 hotel rooms, including all villas and suites, will be operational by the end of July 2007."
in plain language, in the first 3 weeks, no rooms at all, after that 60 rooms until end of July, after July (hope there will be no further delay) 276 total rooms.
This hotel room condition will impact its casino revenue much much more than the table/machine capacity issue due to their geographical location. Basically they assume most VIP table players want to stay with them in the original plan, now they don't even have this facility ready for the first Q.
So even after all the 80 vip table are operational, in the first Q the revenue and net earning will be way off the original plan, let's break down the number
first month, roughtly no room, 26 VIP table, best estimation is it will only make 35% of those 26 tables full earning potential if VIP guests have no room to stay with in CROWN.
so our previous number of $4499 per time unit is really about $2809 vs full potential $9970
second-third month, 60 rooms, 80 VIP table, this looks better, however it can only make the efficiency ratio stay the same of 35% if not reducing at the best since much increased # of table and barely 60 rooms, the number we are looking at will be
80*100*0.35+142*10+550=$4770
so the first quarter looks like $4470*2+$2809=$11749, and the planned full potential is $9970*3=$29910, so my view is 40%-50% at the best.
Here we made a lot of numerical estimation, however looking from any aspects, I have reason to believe the first quarter revenue data will be a huge disappointment by a large margin if you think in the sense of their planned configuration.
When market gets this data, it will further hammer this stock, so I would say, the future of MPEL might be great (actually they did mention together with the second stage hotel rooms, there will be 54% more VIP tables available, which is another 44 more VIP table if we calc from the initial number of 80). The results from second quarter after every facility is in place is really going to make it move. However 4-5 month from now, MPEL stock price will underperform.
For now I will watch it from the sideline, MPEL has long way to go to really reach its bottom. In the meanwhile, there will be a small scale pre-ER run between the announcement of ER date for reporting Crown's first ever Q results and the actual ER, largely driven by naive retail longs hoping for some good numbers and thinking they get the bottom price. However such hope will turn out to be bloody, being a trader, you know what to do to make the best out of it.
After that bad ER in mid-late August (my best guess), MPEL will be trading lower due to the huge disappointment (I have shown you my estimation above), once it stops dropping about 15-20 days after that bad ER, I will be a buyer waiting to jump for a nice and surprising second Q ER number.
Here is why, it is really not about the 15 days or 4 days delay, it is about the confidence of the investors on management ability to run the first 6-star casino ever built on that island.
So what is missing from the openning?
Let's get the fact straight, from the recent conference call
Crown opened with
26 VIP table vs. 80 planned 32.5%
142 premium mass tables, vs 142 planned 100%
479 gaming machines vs 550 planned 87.1%
"the additional 54 VIP gaming tables and 71 gaming machines will be operational within approximately four weeks."
let's do a quick estimation, if every time unit each gaming machine makes $1, premium mass table makes $10, VIP table makes $100, which is just a rough estimation, every time unit, under full occupancy they are planning to make $9970, for the first 4 weeks, they are only going to make 26*100+142*10+479= $4499, which is roughly 45% of the planned profitbility.
So their first month report will be a huge disappointment, since they simply don't have the capacity ready.
This is not the only problem, their real problem is the hotel room.
"Crown Towers hotel will be operational with approximately 60 rooms available within three weeks. Approximately 216 hotel rooms, including all villas and suites, will be operational by the end of July 2007."
in plain language, in the first 3 weeks, no rooms at all, after that 60 rooms until end of July, after July (hope there will be no further delay) 276 total rooms.
This hotel room condition will impact its casino revenue much much more than the table/machine capacity issue due to their geographical location. Basically they assume most VIP table players want to stay with them in the original plan, now they don't even have this facility ready for the first Q.
So even after all the 80 vip table are operational, in the first Q the revenue and net earning will be way off the original plan, let's break down the number
first month, roughtly no room, 26 VIP table, best estimation is it will only make 35% of those 26 tables full earning potential if VIP guests have no room to stay with in CROWN.
so our previous number of $4499 per time unit is really about $2809 vs full potential $9970
second-third month, 60 rooms, 80 VIP table, this looks better, however it can only make the efficiency ratio stay the same of 35% if not reducing at the best since much increased # of table and barely 60 rooms, the number we are looking at will be
80*100*0.35+142*10+550=$4770
so the first quarter looks like $4470*2+$2809=$11749, and the planned full potential is $9970*3=$29910, so my view is 40%-50% at the best.
Here we made a lot of numerical estimation, however looking from any aspects, I have reason to believe the first quarter revenue data will be a huge disappointment by a large margin if you think in the sense of their planned configuration.
When market gets this data, it will further hammer this stock, so I would say, the future of MPEL might be great (actually they did mention together with the second stage hotel rooms, there will be 54% more VIP tables available, which is another 44 more VIP table if we calc from the initial number of 80). The results from second quarter after every facility is in place is really going to make it move. However 4-5 month from now, MPEL stock price will underperform.
For now I will watch it from the sideline, MPEL has long way to go to really reach its bottom. In the meanwhile, there will be a small scale pre-ER run between the announcement of ER date for reporting Crown's first ever Q results and the actual ER, largely driven by naive retail longs hoping for some good numbers and thinking they get the bottom price. However such hope will turn out to be bloody, being a trader, you know what to do to make the best out of it.
After that bad ER in mid-late August (my best guess), MPEL will be trading lower due to the huge disappointment (I have shown you my estimation above), once it stops dropping about 15-20 days after that bad ER, I will be a buyer waiting to jump for a nice and surprising second Q ER number.
Update on URGI
Today's news
"
Crescendo, which is controlled by managing member Eric Rosenfeld, said the shares "were significantly undervalued and represented an attractive investment opportunity."
As I said just now, when I(you) see value, other people see it as well.
update:
their avg cost is $12.5, this well explained why URGI rebounced back from $12 three times (including today) already. Nice safety net.
"
Crescendo, which is controlled by managing member Eric Rosenfeld, said the shares "were significantly undervalued and represented an attractive investment opportunity."
As I said just now, when I(you) see value, other people see it as well.
update:
their avg cost is $12.5, this well explained why URGI rebounced back from $12 three times (including today) already. Nice safety net.
Wednesday, May 16, 2007
HNR analysis in Value Investor Club
In the previous post I mentioned Mohnish Pabrai, just got more information in the recent Barron article (which I don't have subscription, however got to know from VIC)
"In an interview with Barron's Online, Mohnish Pabrai declined to comment about Harvest's specific outlook as a matter of policy, but said the company "is our only and best bet in energy" with an intrinsic value significantly higher than the current stock price. "I'm pretty comfortable if it takes two or three years to get to its intrinsic value."
A long analysis on HNR is also available for 45 days delayed guest access in VIC, I would suggest all HNR holders check it out.
"In an interview with Barron's Online, Mohnish Pabrai declined to comment about Harvest's specific outlook as a matter of policy, but said the company "is our only and best bet in energy" with an intrinsic value significantly higher than the current stock price. "I'm pretty comfortable if it takes two or three years to get to its intrinsic value."
A long analysis on HNR is also available for 45 days delayed guest access in VIC, I would suggest all HNR holders check it out.
Monday, May 14, 2007
A trip into ASPV's 10Q
Let's see what if we want to liquidate this company today.
Let's focus on balance sheet.
Total Assets 354,008k
total liability 32,701k
so total shareholder equity: 321,307k
Different from most other companies, in ASPV's asset part, most of the assets are readily liquidable, there are very little property and equipment and deferred income tax we need to discount if we are going to liquidate it today.
We still end up with about 315,000k current shareholder equity.
So that is if we close ASPV right here right now, with outstanding shares: 35,172,657
we end up with $8.95 /share, which means what we are paying now for its future cash flow is
$19.39-$8.95=$10.44/s
So if we buy today at close, we are paying $10.44/s for ASPV's future earnings.
Let's assume there will be no new partner and new deals.
What does this mean, this means CellCept will be the only drug which ASPV has to generate revenue. and it will face generic competition as early as end of May 2009
In this scenario, let's totally discount ASPV's future earning after 2009 Q2 (end of June)
To construct the earning flow. let's first have a look at the previous earnings.
last 4 quarter's earning:
0.78, 0.71, 0.73, 1.03
The last one $1.03 is the quarter ends March 31st 2007.
as we can see it is actually much better than previous ones on increased revenue and also due to they came to the end of Phase III trial on lupus (thus less trial spending)
Because of the simple business model: the next 9 quarters until our cutoff date can be very easy to estimate, let's use $1.05 per quarter as base, and assume the growth rate is very moderate and equal to the interest rate.
So we have DCF earning estimation of 1.05*9=9.45.
So you can see this highly discounted number is just $1 shy of what we are going to pay today.
That's why I thinkif ASPV dropped to <18.3, it has very minimal downside risk assuming all the above assumptions hold.
Why this number is highly discounted and super conservative:
1. we totally ignored the possiblity of getting a new Partner/Deal. If they are getting a deal, it will totally change the course, and that is the huge upside potential.
2. we totally discounted the earning ability after the patent expiry in U.S, in Europe it expires later, and the manufacturing patent which expires even later can also be a protection, even the most pessimistic analyst estimation in that scenario is sth like: earning will fall after 2010, and disappear after 2014. We did it even more radical, simply cut it off. So this part provided us margin of safety.
3. We estimated the sales on off-lable usage to remain slow growth (as slow as interest rate), which is a very conservative estimation according to previous earning data.
So we have a nice asset play, and very good margin of safety (I would say 20% at least), also great upside potential (if we have new deals), then what is the catch.
If you read my previous post, you will see the catch is actually the incoming Phase III on treating Lupus nephritis, that is the major part of their current off-label revenue.
If it is good, we are looking at boosting the usage of CellCept in lupus nephritis from current 14% to at least 50% in short term, which is a quick 3-4x. our next 9 quarter revenue will be sth like
$1.05, $1.35, $1.9, $2.4, ...
If it is bad, this part of revenue will diminish, and our next 9 quarter calulation will need to revise to sth like $1.05, $1, $0.9, $0.8 ...
So the real downside risk is actually the incoming trial result. If it is good, ASPV should at least worth 28-30 if not more, even if we don't have a new deal coming along at all.
If it is bad, and stands no chance for FDA approval, then ASPV is a sinking ship, will probably settle down in the range of $13-$14.
Another very important implication of the success of the trial: it will significantly boost the possibility of ASPV getting a new partnership/deal, since it shows ASPV's ability to fulfill their responsibility and generate great outcome.
I would say let's watch the trial result, once it is announced to be good, I will rate ASPV strong buy up to 24-25. For now, let's just patiently wait.
Let's focus on balance sheet.
Total Assets 354,008k
total liability 32,701k
so total shareholder equity: 321,307k
Different from most other companies, in ASPV's asset part, most of the assets are readily liquidable, there are very little property and equipment and deferred income tax we need to discount if we are going to liquidate it today.
We still end up with about 315,000k current shareholder equity.
So that is if we close ASPV right here right now, with outstanding shares: 35,172,657
we end up with $8.95 /share, which means what we are paying now for its future cash flow is
$19.39-$8.95=$10.44/s
So if we buy today at close, we are paying $10.44/s for ASPV's future earnings.
Let's assume there will be no new partner and new deals.
What does this mean, this means CellCept will be the only drug which ASPV has to generate revenue. and it will face generic competition as early as end of May 2009
In this scenario, let's totally discount ASPV's future earning after 2009 Q2 (end of June)
To construct the earning flow. let's first have a look at the previous earnings.
last 4 quarter's earning:
0.78, 0.71, 0.73, 1.03
The last one $1.03 is the quarter ends March 31st 2007.
as we can see it is actually much better than previous ones on increased revenue and also due to they came to the end of Phase III trial on lupus (thus less trial spending)
Because of the simple business model: the next 9 quarters until our cutoff date can be very easy to estimate, let's use $1.05 per quarter as base, and assume the growth rate is very moderate and equal to the interest rate.
So we have DCF earning estimation of 1.05*9=9.45.
So you can see this highly discounted number is just $1 shy of what we are going to pay today.
That's why I thinkif ASPV dropped to <18.3, it has very minimal downside risk assuming all the above assumptions hold.
Why this number is highly discounted and super conservative:
1. we totally ignored the possiblity of getting a new Partner/Deal. If they are getting a deal, it will totally change the course, and that is the huge upside potential.
2. we totally discounted the earning ability after the patent expiry in U.S, in Europe it expires later, and the manufacturing patent which expires even later can also be a protection, even the most pessimistic analyst estimation in that scenario is sth like: earning will fall after 2010, and disappear after 2014. We did it even more radical, simply cut it off. So this part provided us margin of safety.
3. We estimated the sales on off-lable usage to remain slow growth (as slow as interest rate), which is a very conservative estimation according to previous earning data.
So we have a nice asset play, and very good margin of safety (I would say 20% at least), also great upside potential (if we have new deals), then what is the catch.
If you read my previous post, you will see the catch is actually the incoming Phase III on treating Lupus nephritis, that is the major part of their current off-label revenue.
If it is good, we are looking at boosting the usage of CellCept in lupus nephritis from current 14% to at least 50% in short term, which is a quick 3-4x. our next 9 quarter revenue will be sth like
$1.05, $1.35, $1.9, $2.4, ...
If it is bad, this part of revenue will diminish, and our next 9 quarter calulation will need to revise to sth like $1.05, $1, $0.9, $0.8 ...
So the real downside risk is actually the incoming trial result. If it is good, ASPV should at least worth 28-30 if not more, even if we don't have a new deal coming along at all.
If it is bad, and stands no chance for FDA approval, then ASPV is a sinking ship, will probably settle down in the range of $13-$14.
Another very important implication of the success of the trial: it will significantly boost the possibility of ASPV getting a new partnership/deal, since it shows ASPV's ability to fulfill their responsibility and generate great outcome.
I would say let's watch the trial result, once it is announced to be good, I will rate ASPV strong buy up to 24-25. For now, let's just patiently wait.
Sunday, May 13, 2007
Interoil Corp. (IOC) Earning Report Monday After hour
IOC is a highly controversial winner (so far)
I am very bearish on its long term future, however it did have surprising
uptrend until now.
This ER will be critical and interesting to watch, and the post-ER momentum will be huge. Prepare for bi-directional with bearish bias. So I have the trading focus on Tuesday.
Don't bet ER though, as a trading rule (my own, if you want to bet, I would
say airforce it) on any highly controversial ones, no matter winner or loser.
So what did this company do in the previous earning reports?
Mar-06 Jun-06 Sep-06 Dec-06
EPS Est -0.15 N/A -0.06 0.03
EPS Actual -0.49 -0.55 -0.25 -0.13
update:
ER out -19c vs. -1c(estimate)
we will see very interesting day tomorrow
I am very bearish on its long term future, however it did have surprising
uptrend until now.
This ER will be critical and interesting to watch, and the post-ER momentum will be huge. Prepare for bi-directional with bearish bias. So I have the trading focus on Tuesday.
Don't bet ER though, as a trading rule (my own, if you want to bet, I would
say airforce it) on any highly controversial ones, no matter winner or loser.
So what did this company do in the previous earning reports?
Mar-06 Jun-06 Sep-06 Dec-06
EPS Est -0.15 N/A -0.06 0.03
EPS Actual -0.49 -0.55 -0.25 -0.13
update:
ER out -19c vs. -1c(estimate)
we will see very interesting day tomorrow
Saturday, May 12, 2007
Bronco Drilling (BRNC)
very nice HCL to watch.
ppl claim it is a high growth oil drilling company on fire sale now
however the recent ER is not that great (you still can see the huge pre-ER momentum typical to HCL)
yesterday it rebounced 4.xx%, I like to track it from here, and do more DD and complete the story and filter out the key issues to watch.
So far from what I can see about the past ER, the rising cost is a concern, however the 40%+ revenue is very nice.
ppl claim it is a high growth oil drilling company on fire sale now
however the recent ER is not that great (you still can see the huge pre-ER momentum typical to HCL)
yesterday it rebounced 4.xx%, I like to track it from here, and do more DD and complete the story and filter out the key issues to watch.
So far from what I can see about the past ER, the rising cost is a concern, however the 40%+ revenue is very nice.
Mad Catz Inc. (MCZ)
This pick was initially from ZZPT@mitbbs, He did a very nice job to point it out before Februry earning report. I am still holding my 1500 shares @0.64 to support his due dilligence. In this blog we have some discussion already on this one.
Yesterday's spike was news driven. It setups another round of pre-ER run for MCZ. If you followed me so far, you will see reason for this pre-ER run is very clear, people's high expectation and hope.
Anyway it is fun to watch this little penny to become non-penny.
The typical Jun ER date for MCZ is June 8 or 9th, I still cannot find the actual date anywhere online. If you find it out, pls post it as comment. Thanks
Yesterday's spike was news driven. It setups another round of pre-ER run for MCZ. If you followed me so far, you will see reason for this pre-ER run is very clear, people's high expectation and hope.
Anyway it is fun to watch this little penny to become non-penny.
The typical Jun ER date for MCZ is June 8 or 9th, I still cannot find the actual date anywhere online. If you find it out, pls post it as comment. Thanks
Disciplined Investor in HNR
Mohnish Pabrai bought HNR shares again, and he really bought a lot recently.
Both of us knew the recent ER was fantastic. However I couldn't hide my exhilaration and rushed to load @10. This guru investor is just so disciplined to only load it below his preset threshold which we all know now it is $10. I like his coolness.
How did he come up with the preset threshold in the first place? From reading his book, I knew his strategy. He must have done very thorough due dilligence and come up with a intrinsic value for a business, and load it when it is on fire sale, the discount rates (margin of safety) for his previous investments have been 25%-40%. So in his mind, HNR's intrinsic value is about in the range of 25-40. I certainly don't disagree with him.
Anyway it is very nice to have this guy with us in HNR.
Both of us knew the recent ER was fantastic. However I couldn't hide my exhilaration and rushed to load @10. This guru investor is just so disciplined to only load it below his preset threshold which we all know now it is $10. I like his coolness.
How did he come up with the preset threshold in the first place? From reading his book, I knew his strategy. He must have done very thorough due dilligence and come up with a intrinsic value for a business, and load it when it is on fire sale, the discount rates (margin of safety) for his previous investments have been 25%-40%. So in his mind, HNR's intrinsic value is about in the range of 25-40. I certainly don't disagree with him.
Anyway it is very nice to have this guy with us in HNR.
Vimicro International Corp. (VIMC)
Seemingly dirt cheap, 182M mkt cap, how come 102M in cash(according to yahoo, I don't trust it at all, however as long as there are ppl trust it, it is then a good thing to have on those HCL).
Delayed earning report, changed auditor.
Remind you another Chinese HCL CBAK right?
Interesting. So keep watching it.Since the delayed ER has to come soon.
You will have plenty of time to play Post-ER momentum.
Did you noticed I have just spent less than 20min and have done retail FA on the first 3 out of HCL candidates list.
All of them are seemingly cheap, however with various problems, I probably don't know its business at all, however I know the things to watch out, and the effort is minimal.
Can you rely on my 6min/pick retail FA for a buy-hold recommendation? heck no. Can you make a lot of money trading them after my suggestion? Surely yes.
Delayed earning report, changed auditor.
Remind you another Chinese HCL CBAK right?
Interesting. So keep watching it.Since the delayed ER has to come soon.
You will have plenty of time to play Post-ER momentum.
Did you noticed I have just spent less than 20min and have done retail FA on the first 3 out of HCL candidates list.
All of them are seemingly cheap, however with various problems, I probably don't know its business at all, however I know the things to watch out, and the effort is minimal.
Can you rely on my 6min/pick retail FA for a buy-hold recommendation? heck no. Can you make a lot of money trading them after my suggestion? Surely yes.
Jupitermedia Inc. (JUPM)
Trading at book value right now (cheap)
track record of return on asset/equity is superb.
Great pick to play momentum, up and down very strong. If you check the post-ER downside momentum on Thursday you will know what I am talking about, It gapped down a bit, you had plenty of time daytrading it.
It might just break out after next strong earning report or important development on its focused online media core business.
A nice HCL to watch.
track record of return on asset/equity is superb.
Great pick to play momentum, up and down very strong. If you check the post-ER downside momentum on Thursday you will know what I am talking about, It gapped down a bit, you had plenty of time daytrading it.
It might just break out after next strong earning report or important development on its focused online media core business.
A nice HCL to watch.
VISICU (EICU)
Great bottom momentom on April 27th after a strong earning report.
Very strong balance sheet. lots of cash. looks very cheap by any standard.
What is the catch?
It's future is being focused on the pending patent filling according to those
article1, article2
So it is a possible news driven player, once you see strong momentum and keywords like"U.S. Patent and Trademark Office ", "iMDsoft" "final ruling" "approved" in newswire. Play Bigger Fool Game without hesitation.
Very strong balance sheet. lots of cash. looks very cheap by any standard.
What is the catch?
It's future is being focused on the pending patent filling according to those
article1, article2
So it is a possible news driven player, once you see strong momentum and keywords like"U.S. Patent and Trademark Office ", "iMDsoft" "final ruling" "approved" in newswire. Play Bigger Fool Game without hesitation.
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