GEO Investing

Call(s) to Action:

This morning we stated:

GeoBargain on the radar CRTN (old symbol TMNG)($4.16) – Appears the company has come through with a breakout quarter.  We have been waiting for a quarter like this since  the company embarked on its multi-year restructuring activities.  Reported non-GAAP EPS of $0.23 vs $0.00 in the prior year.  Highest revenue and EPS quarter in the last 17 quarters.   We will look to re-establish a position given the stock does not get away from us.   Flat line chart looking to break out.

After closer inspection we realized the company included a tax gain in their non-GAAP number.  The real non-GAAP number is $0.04, so not near as exciting as we originally thought.

CRTN will remain a GeoBargain on the radar as we continue to watch the restructuring efforts unfold. However, we are not currently looking to establish position.

DVCR ($6.61) – Also benefiting from recent restructuring activities.  Reported breakout quarter in its Q2 2014 results of $0.17, reversing the trend of 10 straight quarterly losses.  Commentary implies that Q2 trend can continue into the future.

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

  • ChinaHybrids
    • GOBK ($0.08) – Will begin tracking GOBK due to a joint venture agreement with China Xuzhou Shizhen Biotech.   We have noticed that the China-Based reverse merger theme is picking up again; recall we added two other China-Based reverse mergers this week (PAOCD, ZPPB).
    • HGSH ($2.24) – Reported strong Q3 2014 results.  Reported 302% increase in revenues and 260% increase in EPS.
    • LONG ($18.14) – Reported Q2 2014 results. Reported 25% increase in net revenues and first profitable quarter after losses for several years.
  • U.S. News
    • MGPI ($8.16) – Reported strong improvement on bottom line results on slightly up sales.
    • CVGI, FTLF, HALL, WLDN all report strong quarterly earnings reports, please see our earnings screen for full details.
  • GeoBargains/GeoBargains on the Radar
    • GeoBargain ISDR ($9.04) reported strong Q2 2014 results; Q2 2014 revenues of $3.6 million vs $1.7 million in the prior year and non-GAAP EPS of $0.24 vs $0.21 in the prior year.
  • Marijuana Hype
    • Adding BICB to our Cannabis screen.  The company recently acquired two mobile applications for providing marijuana patients/customers with a doctor/dispensary finder capabilities.

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

Disclosure: Long ISDR, looking to establish position in DVCR ; 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 Hgs Real Estate (NASDAQ:HGSH) $3.42 n/a $0.18 $0.05
Elong (NASDAQ:LONG) $17.96 $0.01 $0.14 -$0.36

* denotes non-GAAP; ** Pre-market

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

In Other News…

Globalink (OOTC:GOBK) ($0.08) – We will begin tracking GOBK due to a joint venture agreement with China Xuzhou Shizhen Biotech filed on 07/10/2014. Below are the details of this agreement,

“On April 15, 2014, the registrant entered into a joint venture agreement with China Xuzhou Shizhen Biotech Co. Ltd. to set up a joint venture enterprise named Globalink (Jiangsu) Biotech LLC in Pizhou City in the Jiangsu Province in the People’s Republic of China. This joint venture will be producing products using ginkgo leaves, such as ginkgo biloba extracts, health food, and medicine, and will be studying and developing new products based on ginkgo leaves. Xuzhou Shizhen will invest 20% with technology, management, and scientific research, and the registrant will pay 60 million Chinese yuan (CNY), which will account for 80% of the joint venture.”

We have noticed that the China reverse merger theme is picking up again, please recall that we added two China reverse merger stocks this week (PAOCD, ZPPB).

On the U.S. Front…

Notable U.S. Earnings…

Stock Price** EPS Estimate Reported EPS Prior Year Reported EPS
Mgp Ingredients (NASDAQ:MGPI) $8.70 n/a $0.16 $0.01
Willdan Group (NASDAQ:WLDN) $8.83 n/a $0.25 $0.10
Hallmark Financial Services, Inc. (NASDAQ:HALL) $9.27 -$0.05 $0.13 -$0.11
Fitlife Brands (OOTC:FTLF) $2.65 n/a $0.09 $0.05
Commercial Vehicle Group (NASDAQ:CVGI) $9.20 $0.08 $0.09 -$0.11
Diversicare Health Care Servic (NASDAQ:DVCR) $7.27 n/a $0.17 -$0.32

* denotes non-GAAP; ** Pre-market


Issuer Direct Corp (AMEX:ISDR) ($9.04) – GeoBargain ISDR helps companies produce and distribute their financial and business communications both online and in print. The company reported strong Q2 2014 results:

  • Q2 2014 revenues were $3.6 million vs $1.7 million in the same quarter last year.
  • Non-GAAP EPS of $0.24 vs $0.21 in the prior year.

Quotes from management,

“Overall we are pleased with the results for the quarter. Our continued year-over-year revenue increases, positive cash flow from operations and balance sheet management are trends we have worked hard to preserve. This is the ninth consecutive quarter of positive cash flows from operations going back to 2012.”

“For most of the last year we have focused on the integration of the combined entities of PrecisionIR and Issuer Direct. That phase is now behind us, and we are focused on expanding our newly integrated business through organic growth. We have reorganized our sales organization to take maximum advantage of the talents of our two organizations and we intend to invest and expand our internal sales force and our channel partner network.”

Marijuana Hype…

Biocube (OOTC:BICB) ($0.025) – We are adding BICB to our Cannabis screen. On 07/31/2014 the company filed a 8K which indicates that it is entering the cannabis industry through an Asset Purchase Agreement.  The company acquired two separate mobile applications:

The specific assets related to mobile applications for patients of medical marijuana facilities in Canada and the United States, as follows:

Two (2) separate mobile applications for providing medical marijuana patients in legal states within the United States, and throughout Canada to locate nearby doctors, dispensaries and rate and review strains with a touch of your finger. The US based app also provides state-by-state current legislation, how to qualify for a medical marijuana 10 card and how a patient can take action by contacting their local advocacy group to get involved

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.


The GeoTeam