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David Schrader
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Dave is currently working as an Account Rep at a prominent financial services firm in Manhattan. In addition, he serves in the iMentor program and is under contract with a startup hedge fund for use of an algorithm he discovered. Prior to that David worked as an Equity Associate at First... More
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  • GFRE - Ride The Institutional Wave
     GFRE (Gulf Resources Inc.) manufactures chemical products for use in energy, waste processing, and inorganics.

    Firm is recovering with strength following a high-volume selloff on 12/07/10... shows support. There has been a marked level of new and continuing accumulation by institutions (Fidelity, Vanguard, DE Shaw, etc) as of September 2010. In addition the firm is on solid financial footing with superb liquidity ratios (quick > 5.0) and is trading at less than 4.5x TTM EBITDA (as of 12/08.... 380mm market cap against $88.7mm in TTM EBITDA). With the continuing institutional support we're seeing, combined with the growth in earnings and revenues, and the fact that the firm is positioned in industries which profit from inflation and/or a stronger economy, I expect GFRE is a strong trade or investment. My exit loss would be sub-$10 on a close.


    Disclosure: I or people I know are long the equity.



    Disclosure: I am long GFRE.
    Tags: GURE
    Dec 08 10:16 AM | Link | Comment!
  • Long Idea: CHBT
     Disclosure: I or people I know are long the stocks/options mentioned in the following article.

    The February 2011 $7.50 calls in CHBT are being offered as of $10.15am 11/18 at ~$3.90/contract. 

    Quick Facts:

    x. Short position = approximately 40% of the float
    x. Historically, December has been an EXCELLENT month showing 4 consecutive years of advances in a row, with an avg return of approximately 24%
    x. The firm is trading ~1.3x book with excellent liquidity (quick ratio > 2). Mkt cap = ~240m, $44m TTM EBITDA, trading @ ~5x TTM EBITDA with positive FCF for at least 4 consecutive quarters

    Your breakeven, if executed at $4.00 per contract, would be $11.50/share. The stock is bid $11.07 as I type (10:17am) which means you'd pay a premium of $0.43 (or ~4%) for 3 months of time. In addition you're opening the position with $3.07 of equity in the option so you have a buffer against the decay.

    May be worth a look. The offer size is 390 contracts as of 10:20am.

    I'm viewing this as a leverage play with seasonality, short size, and general market sentiment closing out the year as the various catalysts. I have not dug into the company itself further than this basic level so there very well may be considerations regarding their business model, etc that I have yet to acknowledge. I will do so and provide an update in the comments section. Do your own research prior to investing/trading.

    My loss exit is $10/share in the equity.


    Disclosure: Long call options
    Tags: CHBT
    Nov 18 10:24 AM | Link | 5 Comments
  • Sell
    I would be selling and taking profits with whatever I have left long in the market right now. The 'tax cut continuance' news is showing a buying rush which looks very much like a blow off top. 
    Nov 04 1:34 PM | Link | 2 Comments
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