GEO Investing

Calls to Action: CMGE – News on China internet portals state that  China Mobile Games’ President was fired  along with  9 mangers and 2 Vice presidents.

Here are the stories that the GeoTeam is following today… (Please see full disclosures at bottom)

General Highlights:

  • ChinaHybrid
    • NFEC ($2.60) – Signed a $1.08 million  contract with Shandong Luneng International Trading Co.
    • LAS ($2.79) – announced that it has joined the China Automobile Dealers Association newly launched Certified pre-owned car alliance. Expects to generate $40 million from this alliance for 2014.
    • YGE (3.92) – announced supply agreement of 12MW of solar modules to Malaysian project.
    • TSL ($12.89) announced supply agreement of 60MW of PV modules
  • U.S. News
    • LOAN ($3.08) – Back on our radar due to increased  annual dividend to $0.28 from $0.08.  Sales and EPS have increased year over year for 9 straight quarters.
  • GeoBargains/GeoBargains on the Radar
    • WSCI ($8.73) – Re-coding as a GeoBargain on the radar due to strong  Q2 2014 earnings, bullish management commentary and our anticipation of the company will report strong Q3 2014  financials after the market close today.
    • GeoBargain on the radar IG ($6.00) –  Announced 17th ANDA submission to FDA
  • Speculative
    • AXLE ($0.44) – Elected a shareholder friendly board of directors and ousted the old board.

For more timely information, particularly during the daily trading session, we urge our members to read our message board posts daily.

Disclosure: Long IG ; Other Long Positions; Other Short Positions; Pump & Dump Positions (Password GEO2014)

Summary of general highlights:

On the Asian Front…

Select China Earnings…

Stock Price** EPS Estimate Reported EPS Prior Year Reported EPS
China Cord Blood (NYSE:CO) $4.79 $0.06 $0.07 $0.05

* denotes non-GAAP; ** Pre-market

Please see our ChinaHybrid March 2014 quarter earnings screen (password GEO2014) for select companies that have reported earnings.

In Other News…

Yingli Green Energy (NYSE:YGE) ($3.92) – the largest vertically integrated photovoltaic (“PV”) module manufacturer in the world, known as “Yingli Solar,” today  announced :

“ its wholly-owned subsidiary, Yingli Green Energy Singapore Company Pte. Limited (“Yingli Singapore”), is supplying 12 MWp of solar modules to Gading Kencana Sdn Bhd., a leading solar energy company in Malaysia.Yingli’s high-efficiency PANDA solar modules, which contain Yingli’s patented n-type cell technology, will be used in an 8 MWp utility-scale solar farm in Malacca, Malaysia, which covers approximately 14.5 acres. 30,000 Yingli modules have already been delivered to the project site, and it’s estimated that the plant will generate approximately 11 million kWh of clean electricity per year.”

Trina Solar (NYSE:TSL) ($12.89) – a global leader in photovoltaic (“PV”) modules, solutions, and services, today announced:

“ it will supply 60MW of PV modules to Xinyi Solar Holdings Limited (“Xinyi Solar”), one of the world’s largest solar PV glass manufacturers, for its utility scale and agricultural greenhouse solar projects in Anhui, China.

Xinyi Solar will utilize 5MW of Trina Solar’s TSM-PC05A modules, 30MW of TSM-PC14 modules, as well as 25 MW of the Company’s state-of-the-art dual glass TSM-PDG5 modules. The PDG5 dual glass solar panel will be used as a roof bracing piece for an agricultural greenhouse located within Xinyi Solar’s power plant in Anhui province. Compared to conventional modules, dual glass PDG5 modules provide appropriate transmittance of sun light, which better maintains greenhouse temperatures and its high performance in harsh environments offers resistance to the use of pesticide sprays in the greenhouse. Shipment of the modules is expected to be completed by August 2014.”

Lentuo Intl (NYSE:LAS) ($2.79) – a leading non-state-owned automobile retailer headquartered in Beijing, today announced that it has joined the China Automobile Dealers Association’s (“CADA”) newly launched Xing Certified Pre-Owned Car Alliance (“Xing Alliance”).

“This move, said Lentuo, is projected to generate incremental 2014 company revenue of approximately US$40 million.

This new revenue, said LAS chairman and CEO Mr. Hetong Guo, is expected to arise as a result of the Xing Alliance increasing the level of confidence in pre-owned cars, which, in turn, will enhance growth of Lentuo’s recently formed certified pre-owned car business and increase its 2014 pre-owned sales by about 800 cars.”

Nf Energy Saving (NASDAQ:NFEC) ($2.60) – a leading energy saving service solutions provider for China’s power, petrochemical, coal, metallurgy, construction and municipal infrastructure development industries. Announced that it has recently signed a $1.08 million contract with Shandong Luneng International Trading Co.

“This contract, said Mr. Gang Li, CEO of NFEC, is one of the major valve product orders the Company has entered into this year. Up to date, the total contracted orders for the Company’s valve products have exceeded RMB100 million or $16 million. And, the Company’s 2014 revenue is expected to be much better than that of last year. “

Agria (NYSE:GRO) ($1.34) – a global agricultural company,  announced interim trading results and updated guidance at its majority-owned subsidiary PGG Wrightson Ltd. (“PGW”).

“The Company noted that despite localized challenges, sales performance over the past six months met expectations. PGW now expects full fiscal year operating EBITDA (earnings before interest, tax, depreciation and amortisation) in the range of NZ$56 to NZ$58 million (US$48 to US$50 million), up from the previously guidance range of NZ$52 to NZ$56 million (US$45 to US$48 million) indicated in February this year.”

On the U.S. Front…


Wsi Industries (NASDAQ:WSCI) ($8.73)- a leading contract manufacturer that specializes in the machining of complex, high-precision parts for a wide range of industries, including avionics and aerospace, energy, recreational vehicles, small engines, marine, bioscience and the defense markets. We are re-cording WSCI as a GeoBargain on the radar (GBR). Previously, WSCI was a GBR between 8/6/2012 and 4/3/2013. During its tenure the stock rose nearly 20%, but declined 27% at the time of  its removal from the list.  We removed the stock from the GBR list after it became apparent that the company’s strategy to take growth to a new level had met short term challenges. Here are the original reasons we were tracking the stock, outlined on 8/7/2012:

  • Company just reported 2012 3rd quarter results.
    • The results exceeded any quarter in the last 10 years by over $2 million.
    • Bottom line profit results also improved with the fiscal 2012 third quarter at $0.21 per diluted share equating to a 51% increase over the prior year quarter, which is also at the highest level in the last 10 years.
  • The company is benefiting from penetration into markets that are experiencing favorable growth trends such as the recreational vehicle and energy industry.
  • Company commentary was upbeat heading into 2013. Furthermore, the company just announced it will be embarking on a plant expansion to gear up for future growth. The planned expansion will double current capacity.
  • Placing on the GeoBargain on the radar list.
  • Company guidance implies that the company’s 2012 fourth quarter ending in August will match 2012 third quarter results.
  • Will attempt to interview the company. Keep in mind that the company has had erratic quarterly EPS history.

And here are the reasons we are actively tracking the stock again:

  • After 4 quarters of weak bottom line growth and several periods of inconsistent growth  the company reported nice growth for its Q2 FY 2014 (insert Reuters table).
Fiscal Quarter 2014 Fiscal Year 2013 Fiscal Year 2012 Fiscal Year
REV $10.2 $8.6 $6.0
EPS $0.12 $0.15 $0.04
REV $10.5 $7.2 $7.0
EPS $0.09 $0.02 $0.06
REV Tbd $9.2 $9.5
EPS Tbd $0.04 $0.21
REV Tbd $9.0 $9.7
EPS Tbd $0.04 $0.20
REV Tbd $34.0 $32.5
EPS Tbd $0.25 $0.51

note: numbers are in millions except EPS.

  • The 2nd quarter is the company’s seasonally weakest quarter, yet, revenues for the quarter were sequentially higher than 1st quarter 2014.
  • Three new orders were received in Q2 2014  that expect to be delivered in Q3 2014.
  • Management  commentary on 2nd quarter 2014 indicates that all business segments are firing on all cylinders which could lead to sustained near term growth.

“While the powersports segment of our business has been dominant during the first half of the year, we are continuing to see evidence that our energy business is strengthening. During our fiscal second quarter, we received orders from three new customers in the energy business, which we expect to commence delivery on in our fiscal 2014 third quarter. In addition to improvements in our energy business, our aerospace, avionics and defense businesses have also shown sales growth in the first half of fiscal 2014.” Rashleger concluded: “We expect to see continued improvement in sales and earnings in the last half of fiscal 2014 considering our optimism in many segments of our business.”

  • Given the fact that there is a good chance that the company will report homerun financial results that will be above investor expectations in the near term, the company is scheduled to report its 3rd quarter 2014 results on today (06/19/2014) after market close.  It could be a buy opportunity before the earnings announcement.

Igi (AMEX:IG) ($6.00) – GeoBargain on the Radar IG engages in developing, manufacturing, filling, and packaging topical semi-solid and liquid products for cosmetic, cosmeceutical, and pharmaceutical customers in the United States. IG announced today that it has submitted the 17th ANDA in 2014 to the FDA.

Quotes from management:

“……We believe our current pipeline of submissions pending approval by the FDA has a combined addressable market of over $420 million based on recent data from IMS Health.”

In Other U.S. News…

Manhattan Bridge Capital, Inc (NASDAQ:LOAN) ($3.08) – provides short-term, secured, and nonbanking loans to real estate investors to fund their acquisition and construction of properties in the New York Metropolitan area.  We are placing LOAN back on our watch list due to the   management‘s move to  increase  the   annual dividend to $0.28 from $0.08.  Also note that sales and EPS have increased year over year for 9 straight quarters.

On March 6, 2013 we informed members that we added LOAN to our new high screen.  Our note:

“The company has consistently grown annual revenues from $1 million in 2009 to $1.4 million 2011, and is on track to report nearly $2 million in revenues in 2012.  Furthermore, the company has grown its revenues sequentially for seven straight Quarters.  EPS growth has not been as consistent, but we like the industry that the company participates in which should continue to get a lift from the  “hard to borrow “ loan environment caused by the 2008 recession.  Specifically,  “…the company provides short-term secured non-banking commercial loans to real estate investors (also known as hard money) to fund their acquisition and construction of properties located in New York Metropolitan area.” The company is also buying back shares and has just settled a legal dispute.  Selling below book value of $1.92, the company has only 4 million outstanding shares and a float of 1.7 million shares.  Investors should note that the company has only two full-time employees.”

We will attempt to contact management to  determine  if the new dividend  rate is sustainable.


T.j.t., Inc. (NBB:AXLE) –  AXLE engages in repairing and reconditioning axles and tires for the manufactured housing industry in the United States. Reasons for tracking:

  • After a long period of unimpressive financial results due to the 2008 global recession the company had minor increases in profitability for 3 quarters in a row on a large increase in sales.
  • Entering its seasonally strongest quarters.
  • Elected a shareholder friendly board of directors and ousted the old board.
  • Non-core operations have been dissolved.
  • Apparently, the outlook for manufactured housing is benefiting from the demand from oil producing regions in the U.S. Management quote from 4th quarter 2013  press release:

“We have seen signs of improvement of manufactured housing industry over the past year after what has been the longest downturn in industry history. Manufactured housing sales are increasing, primarily driven by the increased demand for housing in the Bakken and other oil producing regions.”

Fiscal Year 2014 Fiscal Year 2013 Fiscal Year 2012 Fiscal Year 2011 Fiscal Year 2010 Fiscal Year 2009 Fiscal Year 2008 Fiscal Year
REV Tbd $4.0 $4.0 $6.0 $7.3 $9.1 $16.2
EPS Tbd -$0.08 -$0.25 -$0.24 -$0.34 -$0.38 -$0.15

note: numbers are in millions except EPS.

For more timely information, particularly during the daily trading session, we urge our members to read our message board posts daily.


The GeoTeam