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Jamz Unlimited  

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  • Tax Issue Resolved for Gushan Environmental Energy? [View article]
    I am not 100% certain of anything regarding this tax announcement. I am fairly certain that one way or another this benefits Gushan. The news is fairly straightforward, that oil producers will be exempt from consumption tax. Gushan is an oil producer that uses raw materials like a refinery, and this announcement is clearly meant to provide financial benefit to fuel producers.

    Also, it makes mention of this being something that doubles back on a notice sent during 2009, and that is exactly when GU was notified that it would be liable for consumption tax. So there's a connection on dates there as well.

    We'll see what they say during or after earnings.
    Nov 24, 2010. 09:28 AM | Likes Like |Link to Comment
  • Tax Issue Resolved for Gushan Environmental Energy? [View article]
    Biofuel is a fuel so I am not sure what you are getting at. Your second to last sentence sums up exactly why I wrote this article.
    Nov 23, 2010. 05:29 PM | Likes Like |Link to Comment
  • Tax Issue Resolved for Gushan Environmental Energy? [View article]
    Unfortunately I give no guidance on daily trading. I did say and I do believe that if and when GU brings its production back online, I believe the share price will react positively. Getting clarification on being exempt from consumption tax is an important step toward that end and as I wrote here we may be close to that resolution.
    Nov 23, 2010. 04:26 PM | Likes Like |Link to Comment
  • Revisiting Gushan Environmental Energy: Q & A With Management [View article]
    Margins are different because they are fighting the tax authorities and not producing, so depreciation continues to eat away on the income statement (and balance sheet for that matter), and margins are terrible right now. Management indicated they would be profitable if they started producing fully like CBEH does.

    I don't know why CBEH does not have the tax issue but I believe it may have to do with the difference in GU and CBEH customers and sales channels. GU sells to the government I believe. I may be wrong here and this is a great question for the next CC that you should ask. This same goes for the difference is sales price.
    Oct 29, 2010. 08:29 AM | Likes Like |Link to Comment
  • Revisiting Gushan Environmental Energy: Q & A With Management [View article]
    I believe the issue is less with competition and more with the market price for diesel as it is a commodity essentially. Management indicated to me and I posted here that they would be profitable once they bring their plants back online. One large driver to profitability that I pointed out in my first article was depreciation on their large PPE base, so when they sit idle, and GU writes off expenses to depreciating as asset that is not producing revenue, margins are bad, but its mostly these non-cash expenses.
    Oct 29, 2010. 08:24 AM | Likes Like |Link to Comment
  • Revisiting Gushan Environmental Energy: Q & A With Management [View article]
    My guess is that the answer is no, or at least not any time soon as their PPE are built for biodiesel.
    Oct 29, 2010. 08:21 AM | Likes Like |Link to Comment
  • Revisiting Gushan Environmental Energy: Q & A With Management [View article]
    My first article covers this question in depth.
    Oct 28, 2010. 04:38 PM | Likes Like |Link to Comment
  • Revisiting Gushan Environmental Energy: Q & A With Management [View article]
    You are correct. To my defense, I was told there would be no math on this test. I asked the editors to correct this.
    Oct 28, 2010. 04:37 PM | Likes Like |Link to Comment
  • China Ritar Power: Tremendous Growth at a Discounted Price [View article]
    Just have your price targets set at when you want to sell if you are trading for the short term. It seems an undesired result of my articles is quick and rapid price appreciation though my belief in these stocks is long term. I have no idea how these will trade in next several weeks or months, as my view is long term only.
    Oct 13, 2010. 11:06 AM | 1 Like Like |Link to Comment
  • Gushan Environmental Energy: A Diamond in a Rough Patch [View article]
    I have little insight here except that this would help GU when importing raw materials from Indonesia, as outlined in their supply diversification plan-- The way I see it, stronger local currency means more purchasing power to the weaker currency in that exchange. Lower inflation would also make its local raw materials supplies cheaper-- so I think it's good news all around.
    Oct 8, 2010. 02:25 PM | Likes Like |Link to Comment
  • Gushan Environmental Energy: A Diamond in a Rough Patch [View article]
    Indeed. My analysis above writes down PPE by 35% from book values to arrive at 2.50 per fair value of tangible equity.
    Oct 5, 2010. 03:30 PM | Likes Like |Link to Comment
  • Gushan Environmental Energy: A Diamond in a Rough Patch [View article]
    Unfortunately I 100% disagree with your assessment that there is no point in making an investment if there is no growth in top or bottom line for the time being. To me this seems like a short sighted view of the company's story. They had been growing before 2009 and still have expansion plans and are building out their volume. The long argument here is that they will grow again in the future, and in the meantime the company's strong balance is compelling.
    Oct 5, 2010. 03:21 PM | Likes Like |Link to Comment
  • Gushan Environmental Energy: A Diamond in a Rough Patch [View article]
    I have thought about this a lot. My feeling is that management wants to keep it listed. The stock currently qualifies for a reverse split or change in ADR ratio because the market cap and shareholder's equity is above $50MN. These are the requirements per the NYSE to for qualifying to reverse split. Management indicated in the latest earnings release that it intends to change the ADR ratio to comply with its NYSE listing if the share price doesn't go above $1 during the "cure period." For confirmation on management's statements about this, follow the link below and search for "Cure Period."

    www.sec.gov/Archives/e...
    Oct 5, 2010. 02:40 PM | 1 Like Like |Link to Comment
  • Gushan Environmental Energy: A Diamond in a Rough Patch [View article]
    Well I am not someone who told you to buy above $3, and I'm not someone who's telling you to buy now. What I am saying is that I believe the current price undervalues the company by a large amount, mostly due to its tangible equity on the books (some in form of cash, others in the form of PPE). This is something I personally look for when making a risky investment for my portfolio.

    And to your point about this article not justifying a purchase at any share price-- to me that completely goes against investing theory. Every asset should have a point where buying provides value to the buyer. In this case, for me, 40% below cash balance without debt on the books and $3.39 per share in tangible equity, with a .64 share price is a buying point for the portion of my portfolio where I take a large amount of risk.
    Oct 5, 2010. 01:31 PM | 2 Likes Like |Link to Comment
  • Gushan Environmental Energy: A Diamond in a Rough Patch [View article]
    These are very good points. My reading on this is not that ramping up production would not shock the entire chemicals industry as you have eluded to, but would shock GU's current sales channels which are small. Management has indicated that they are investing in building their sales channels to the chemicals industry in order to be able to sell fully through a larger channel. The beef up in chemical sales is new so according to management they can't just dump a huge capacity into their current sales channel.

    Over the entire spectrum of the chemicals industry worldwide, I don't think it is the case that GU can single handedly oversupply the entire spectrum.
    Oct 5, 2010. 11:07 AM | 2 Likes Like |Link to Comment
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