Call(s) to Action – Possible Short Opportunity: CREG ($1.88) – Appears that an institutional owner of CREG shares, Carlyle Asia Growth Partners, intends to sell its shares in the open market. Carlyle Asia Growth Partners owns around 12 million shares.
Here are the stories that the GeoTeam is following today… (Please see full disclosures at bottom)
- LIWA (halted) – After nearly a two month halt, the NASDAQ has delisted LIWA from the exchange. Shares are slated to reopen on the Pink/Greysheets today.
- CMGE ($14.36) – Strongly rejects recent allegations. “The Company is currently unaware of any evidence of bribery. Nevertheless, in order to provide the highest level of transparency to its shareholders, the independent committee has been formed to look into and address the market speculations circulating in the market.”
- VIMC ($2.97) – has won two contracts to provide SVAC-compliant video surveillance products and systems for traffic control in Taiyuan City, aggregated to USD 14.21 million approximately.
- NATR ($15.67) – Announced strategic alliance with Fosun Pharma.
- CSIQ ($28.51) – Announced new agreement, expects to generate over C$300 million.
- NUIN ($2.08) – Announced that its CEO, Ms. Lianyun Han, has completed two strategic private share purchase transactions for a total of 1.9 million shares, reducing her ownership and voting power in the Company from approximately 46.9% to approximately 36.0% on a fully diluted basis.
- U.S. News
- MXC reported improved for Q4 2014 earnings and see’s extensive opportunity for development of its properties in the Permian Basin of West Texas and New Mexico.
- GeoBargains/GeoBargains on the Radar
- GeoBargain on the radar IG ($5.54) – IG was granted a non-exclusive license to launch its diclofenac sodium topical solution 1.5% product on March 28, 2015. IGI received tentative approval of its diclofenac sodium topical solution 1.5% from the FDA on May 7, 2014. IG expects final FDA approval prior to launch date.
- Tier 1 Pinks
- KRSL ($12.50) After 4 quarter hiatus , KRSL reported its second quarter in a row of increased sales and earnings.
- IVDN ($1.37) Shares continue to hit new highs as investors await one of the company’s key products to be certified for global distribution. Still uncertain if this is legitimate company or pump and dump.
- Marijuana Hype
- IDGC ($0.00) Adding to our Cannabis screen due to the distribution agreement of Green Rush cannabis/hemp product line.
For more timely information, particularly during the daily trading session, we urge our members to read our message board posts daily.
Summary of general highlights:
On the Asian Front…
Lihua Intl (OOTC:LIWA) (halted) – After nearly a two month halt, the NASDAQ has delisted LIWA from the exchange. Shares are slated to reopen on the Pink/Greysheets today. Please recall on 4/30/3014 we issued our investor alert stating LIWA is in a serious debt crisis and its chairman Zhu Jianhua is being investigated by local police.
China Recycling Energy (NASDAQ:CREG) ($1.88) – Will have full details tomorrow.
“Our CEO Mr. Xiao Jian believes that Mr. Ying Shuling and the other 8 executives job reassignments would be better utilized in other capacities. To the best of the Company’s knowledge, the Company is currently unaware of any evidence of bribery. Nevertheless, in order to provide the highest level of transparency to its shareholders, the independent committee has been formed to look into and address the market speculations circulating in the market. An external law firm will be appointed to assist the independent committee. The Company will announce further update on the results of its independent committee’s investigation.”
Vimicro Intl (NASDAQ:VIMC) ($2.97) – a leading video surveillance technology and solution provider, today announced that its joint venture, Shanxi Zhongtianxin Science and Technology Co., Ltd. (Zhongtianxin), has won two contracts to provide SVAC-compliant video surveillance products and systems for traffic control in Taiyuan City, aggregated to USD 14.21 million approximately.
Zhongtianxin is a 51% joint venture owned by Vimicro, and 49% owned by Shanxi Guoxin Investment Co., a state-owned investment company of Shanxi Province. One contract is to cover 28 streets of video surveillance valued at RMB 76.68 million, orUSD 12.37 million approximately, with the other covering 3 streets valued at RMB 11.42 million, or USD 1.84 million approximately. SVAC is China’s national video surveillance technology standard, standing for Surveillance Video and Audio Coding, promulgated in May 2011.
“We are pleased to announce two contract wins to supply SVAC-compliant video surveillance products for traffic control in Taiyuan. As one of the only two co-leading developers of China’s SVAC national standard and the only SVAC technology and solution provider, Vimicro is working with various cities in Shanxi to roll out SVAC-compliant video surveillance systems for public security in an orderly manner. Along with this orderly roll-out, we are also seeing a great opportunity of SVAC adoption in other sectors and applications in these cities, such as traffic control and commercial use. The two contract wins is a validation of this opportunity captured in expanded SVAC adoption to other sectors,” commented Dr. John Deng, Vimicro’s Chairman and CEO. “We will continue to leverage our first-mover advantages in China’s SVAC national standard adoption to further penetrate China’s video surveillance market, from both geographic and sector perspectives, to create long-term value for our shareholders.”.
Natures Sunshine Products (NASDAQ:NATR) ($15.67) – a leading natural health and wellness company engaged in the manufacture and direct selling of nutritional and personal care products today announced that it has signed definitive agreements with Shanghai Fosun Pharmaceutical (Group) Co., Ltd. (“Fosun Pharma”), which is a listed company on both China Mainland and Hong Kong stock markets, regarding to the formation of a China joint venture to market and distribute Nature’s Sunshine and Synergy products in China and an investment by Fosun Pharma of approximately $46.3 million in Nature’s Sunshine common stock to be issued pursuant to a private placement transaction. NATR intends to use the net proceeds of the private placement transaction to fund its share of the China joint venture and pay a special one-time cash dividend of $1.50 per share contingent upon transaction closing. The parties anticipate closing the joint venture and private placement transaction in the third quarter of 2014, subject to customary closing conditions including the receipt of required regulatory approvals. Quotes from management:
“Our agreement represents the first transaction in which Fosun Pharma has coupled a major ownership position with the formation of a joint venture. The joint venture is also the first of its kind between a U.S. company and a Chinese company for direct selling products in China, and represents a significant competitive differentiator in the marketplace. We view this joint transaction as both a testament to the strength of our existing business as well as Fosun Pharma’s confidence in our ability to establish a substantial business in China. It marks a significant step forward in our transformation to a global organization with multiple brands and distribution channels.”
Canadian Solar (NASDAQ:CSIQ) ($28.51) – one of the world’s largest solar power companies, today announced that its wholly-owned subsidiary, Canadian Solar Solutions Inc., has entered into an Engineering, Procurement, and Construction (“EPC”) agreement with Kingston Solar LP, a solar energy project developed by Samsung Renewable EnergyInc. (“Samsung”) for the construction of a 140 MW DC (100 MW AC) utility-scale solar energy farm. The EPC agreement is expected to generate revenue of over C$300 million for Canadian Solar. The construction of the utility-scale solar energy farm will begin in the third quarter of 2014, and is expected to be fully operational in the third quarter of 2015. This is Canadian Solar’s second EPC agreement in connection with a solar project developed by Samsung and represents Phase II of Samsung’s Green Energy Investment Agreement (“GEIA”) solar project development in Ontario, which totals 300MW AC. This follows the Phase I agreement announced on June 10, 2013, for Canadian Solar to build the 130 MW DC Grand Renewable Energy Park in Haldimand County. Quotes from management:
“We are delighted to partner with Samsung and Kingston Solar LP to collaborate on the construction ofCanada’s largest solar farm which will not only expand the use of solar energy but also create green manufacturing jobs in Ontario,” said Dr. Shawn Qu, Chairman and Chief Executive Officer of Canadian Solar. “We believe that this transaction demonstrates that our proven solar project experience, global reach as well as strong partner relationships sets Canadian Solar apart as a leading provider of solar energy solutions on a global basis, positioning us well to participate in the expected growth of solar energy deployment in the quarters and years ahead.”
Nutrastar Intl (OTCCB:NUIN) ($2.08) – a leading producer and supplier of premium branded consumer products, including commercially cultivated Cordyceps Militaris (“Cordyceps”), health beverages, and organic and specialty foods, today announced that its CEO, Ms. Lianyun Han, has completed two strategic private share purchase transactions for a total of 1.9 million shares, reducing her ownership and voting power in the Company from approximately 46.9% to approximately 36.0% on a fully diluted basis.
The first transaction of 300,000 restricted shares at a previously negotiated purchase price of $1.40 per share was completed with its long-term and value-added shareholder, Accretive Capital Partners (“Accretive Capital”), a private investment fund founded and managed by Richard Fearon, an active member of Nutrastar’s Board of Directors. Founded in 2000, Accretive Capital targets undervalued small and micro-cap public companies that represent attractive take-private candidates. The fund has been nationally ranked by Morningstar, Barron’s Magazine, Bloomberg, Lipper, and Barclay Managed Funds, was recipient of HFM Week Magazine’s 2011 Best Single Manager Long-Term Performance award among all U.S. hedge funds under $250 million, and was named finalist for PAM Magazine’s 2014 Best Wealth Manager Long-Term Performance award.
On the U.S. Front…
Igi (AMEX:IG) ($5.54) – 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 today announced that it has entered into an agreement with Mallinckrodt LLC, Mallinckrodt Inc., and Nuvo Research, Inc. (TSX: NRI) (together Mallickrodt), and according to this agreement IG was granted by Mallinckrodt a non-exclusive license to its diclofenac sodium topical solution 1.5% from the FD on 05/07/2014.
Quotes from management:
“……The agreement provides IGI with a date certain launch of diclofenac sodium topical solution 1.5%. We remain confident in our ability to obtain final FDA approval of our ANDA for diclofenac sodium topical solution 1.5% prior to our agreed upon launch date. The agreement allows IGI to continue to expand its portfolio of generic topical prescription drug products.”
In Other U.S. News…
Mexco Energy Corporation (AMEX:MXC) ($8.77) – an independent oil and gas company which engages in the acquisition, exploration, development, and production of natural gas, crude oil, condensate, and natural gas liquids in the United States, reported first quarter 2014 financial results:
- Revenue in first quarter 2014 is 0.96 million compared to 0.94 million in prior year.
- Non-GAAP EPS in this quarter is $0.03 vs -$0.02 in prior year.
Quotes from management:
“The Company’s prospects for current and future development of its properties in the Permian Basin of West Texas and New Mexico by horizontal drilling and multi-stage fracturing are extensive.”
Tier One Pinks…
Kreisler Mfg (OOTC:KRSL) ($12.50) – KRSL manufactures and sells precision metal components and assemblies primarily for use in military and commercial aircraft engines, and industrial gas turbines in the United States and Poland. On 9/25/2012 we discussed KRSL:
“Over the last several years, the company has had a difficult time recapturing its moment of glory, as evidenced by stagnant revenue growth and losses reported for several of its quarters. The company was able to report EPS of $0.08 in its 2012 2nd quarter on revenue levels that were slightly higher than what was recorded in recent quarters. However, the company reported revenues of $11.3 million in its 2012 third quarter, which is significantly higher than the $7 to $9 million quarterly levels over the past 14 quarters. More impressive was that the company reported 2012 third quarter EPS of $0.19, which easily exceeds any quarter over the last 14. The Company offers no outlook commentary in its filings, rendering it difficult to determine if the recent accomplishments are just a temporary scenario. Since the company is in the Aerospace industry, it has exposure to the fiscal cliff risk. We will attempt to interview the company.”
After a brief period of positive operating performance since we published our note, growth sputtered in 2013 with revenues and earnings declines from 2012 levels. However, the company has now put together two strong quarters in a row, putting the stock back on our radar:
- Q2 2014 Results
- Revenue for the second quarter 2014 were $6.8 million vs $6.3 million in the prior year
- EPS for the second quarter 2014 of $0.26 vs $0.00 in prior year
- Reported strong Q3 2014 results
- Revenues for the third quarter 2014 were $8.5 million vs $7.3 million
- EPS for Q3 2014 were $0.48 vs $0.11 in the prior year
- Backlog is up to $43.8 million from $34.6 in the prior year.
- The $8.5 million in revenue reported marks the highest level since Q1 2013 ($8.9)
- Recent defense budget update bodes well for KRSL
- Even with applying a low P/E multiple of 10 on twelve month trailing EPS of $1.54 gives us a near term price target of $15.40.
- Has had sporadic strong results in the past, so need to interview management to see if current results are sustainable.
- Have had trouble securing interview
Innovative Designs (OOTC:IVDN) ($1.37) – IVDN manufactures and markets cold weather recreational and industrial clothing products made from INUSULTEX. The shares of the company continue to hit news highs as investors are waiting for the news that one of the company’s key products is to be certified for global distribution. We are still uncertain that if this company is a legitimate company or a pump and dump, and we will keep tracking it. In our 6/20/2013 email we mentioned:
“The stock has had a choppy performance over the past 5 years jumping between $0.20 and $0.50. But, the stock has been strong of late and is attempting to break $1 to the upside. The Company has been gaining investor enthusiasm about its home installation product called Insultex® House Wrap. Annual revenues have ranged between a half million and a million since 2007, but the company is hoping that certification of its insulation product will significantly change its financial outlook.”
Shares of the company continue to hit new highs and broke through $1.00.
Idglobal Corp. (NBB:IDGC) ($0.00) – We are adding the stock into our Cannabis screen. On 06/18/2014 the company announced that it has obtained the exclusive worldwide licensing and distribution agreement from Corr Brands, Inc. (CBI) for GREEN RUSH(TM) cannabis/hemp product line.
“This is a significant step for IDGC to enter the medical marijuana market with an established and trusted group. We have been in discussions with other strategic partners and affiliates to ensure we execute and take full advantage of this opportunity. More details about the partnerships and roll out plans will follow.”
For a list of stocks we are tracking in the Marijuana space please go here.
**Please note that our decision to buy selected marijuana names is just based on our desire to ride the hype surrounding the sector and not an endorsement of their operations. In the long-term, most of the marijuana stocks being hyped will likely come crashing down. Also note that on 3/17/2014 we mentioned that we have liquidated most of our marijuana holdings.
For more timely information, particularly during the daily trading session, we urge our members to read our message board posts daily.