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Jeff Andry  

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  • China and Fuwei Films: Seeking Sanity [View article]
    Nice write-up. Chinese ADRs have proved safe throughout the upheaval we've seen over the past couple of years. RTOs and SPACs should be reviewed with strict scrutiny. ADRs and IPOs tend to be on the safer side.

    I wouldn't even consider investing in an RTO or SPAC. I would consider an ADR or IPO. Thanks for the write-up.
    Jul 8, 2011. 09:27 PM | 1 Like Like |Link to Comment
  • Dow 30 Trading Ranges [View article]
    This is a great chart for quickly seeing the summary of Dow 30 component trading movement over the past week. Is this something you all publish regularly?
    Jun 16, 2011. 09:46 PM | Likes Like |Link to Comment
  • Cinedigm: A Micro Cap Play on Digital Cinema [View article]
    Great write-up. I'm looking forward to reading your more detailed report that I've found on your website. I recently picked up Ballantyne Strong, a company in line with your investment thesis re: digital media. Cinedigm looks like a great compliment to that holding. It's not a matter of "if" theaters across the country (world) make the full transition to digital media, but "when"; and I agree that there's market share to be had for some of the small participants in this space.
    Apr 18, 2011. 12:34 AM | Likes Like |Link to Comment
  • Why Is Atrinsic (Kazaa) the New Favorite Target of Short Sellers? [View article]
    I actually prefer QuantCast to Alexa. QuantCast has ranked 859th in the U.S. That alone, based on prior web-company buyouts, seems to add significant value to the Kazaa name.

    Here's the link to QuantCast:

    And here's a write-up by a guy from back in 2010 who calculated the price per UMV (unique monthly visitors) for a whole host of companies.

    Kazaa's got about 2M UMVs a month.
    Apr 7, 2011. 12:32 AM | Likes Like |Link to Comment
  • Longwei Petroleum: A Contrarian Long Idea for 2011 [View article]

    I'm in complete agreement with you that a lot of the hysteria is overplayed. I think the SEC is likely just scoffing at the fact that these companies are able to enter our markets without first being subjected to the SEC's close scrutiny.

    I've owned LPH on numerous occasions. I've also owned a host of other Chinese RTOs. My point is simply that the legitimate RTOs like LPH still swim in the same pond as some of the fraudulent ones. More importantly, I don't think there's much we can do about it as none of the best analysts and most of the largest institutional investors aren't willing to put their name behind the majority of these stocks.

    For every three or so undervalued RTOs, there's an undervalued ADR or IPO. I'd suggest pursuing those.
    Feb 15, 2011. 12:37 AM | 1 Like Like |Link to Comment
  • Longwei Petroleum: A Contrarian Long Idea for 2011 [View article]
    It's not necessarily that Chinese companies as a whole are being written off, it's that Chinese RTOs are being written off. The fact remains that the SEC has these companies under the microscope. Perhaps its unwarranted. Perhaps the SEC just doesn't like that companies are entering the market through a backdoor process that they aren't able to more closely regulate (yet, at least). These companies have lost favor. The lack of a respectable bank to underwrite/market the company's shares, coupled with sub-par auditors and law firms in many instances, has plagued the entire space and lead people to ask:

    Why DIDN'T they IPO?

    Is there something that wouldn't pass a more scrutinizing test that would likely arise in the case of an ADR offering or IPO?

    There's just too much mystery. Investors don't like mystery. While many (perhaps even most) are legitimate companies with solid operating histories and consistent sales growth, the well has nonetheless been contaminated and to convince the general investing public (many of which can't fathom the thought of reading a company's entire filing history) that your RTO is different from the rest is an extremely daunting task, especially as the U.S. markets continue to rally.

    My suggestion, not that it's worth anything, would be to focus on the Chinese ADRs/IPOs that are beaten down just by being associated with China, then scream from the mountaintops (a) this stock is undervalued, but equally importantly (b) it's NOT an RTO.
    Feb 14, 2011. 11:37 PM | 1 Like Like |Link to Comment
  • Why Investors Are Overreacting to Amtech's Shelf Offering [View article]
    I, too, am left wondering what the company could even fathom doing with 60M. But this is just the announcement. No securities have been issued yet. As it stands now, we're in the exact same condition we were but with much higher guidance than before.

    That being said, my conservative approach of accounting for the full 60M in common shares, still puts us at a fair PPS that is 95% of what the market cap would be if they issued 3M in a non-dilutive fashion, i.e. at $25 or so.

    That puts our fair PPS today, based on what was fair before the announcement of the shelf (29$), at mid-$27.

    This is why we're seeing the correction today.

    Yes, the company should have been clearer as to what these funds will be used for.

    But ... yes, shareholders have overreacted and we have no business dipping back down into the $23s.

    That's my premise for this article. As to the 60M, we'll have to wait and see what comes of it.
    Feb 11, 2011. 11:12 AM | Likes Like |Link to Comment
  • Why Investors Are Overreacting to Amtech's Shelf Offering [View article]
    This is similar to a line of credit. 60M is the mere ceiling. If they need that much, they'll raise that much. If they need 10M, they'll raise 10M.
    Feb 11, 2011. 11:09 AM | Likes Like |Link to Comment
  • History repeats itself on ASYS, crushes earnings and shorts flood in. [View instapost]
    I just submitted an article re: the overreaction by investors due to the shelf. Perhaps shorts are using the shelf to feed off of as well.

    I hypothesize a conservative assumption as to the shelf in which I assume (conservatively) that the entire 60M will be in the form of common stock (even though it could end up being a mixed debt/equity offering). I also assume (in my opinion, again conservatively) that the company would issue 3M shares at a PPS of $20.

    Assuming a PPS of $25, in order for the equity financing not to be dilutive, the company would have to issue the 3M at $25. That, however, can't be the case since they're only raising 60M.

    So if by adding 75M to the market cap we would see what the market cap would be in a non-dilutive scenario, we can then add 60M to the market cap to see what it will be in this hypothetical dilutive scenario.

    Non-Dilutive = 235,220,375 (Market Cap at $25/share) + 75M = 310,220,375

    Dilutive = 235,220,375 (Market Cap at $25/share) + 60M = 295,220,375

    There are two ways to calculate what this would do to the PPS. Also, I'll assume the $29 to be fair, since the market thought that price was fair until we received word of the shelf offering, i.e. that is the last closing price before the announcement of the shelf.

    Under method (1), we use an absolute basis of 15M. We would just take the market cap at $29 (which would be 29 x O/S of 9,408,815 = 272,855,635) and subtract an absolute 15M from this figure to arrive at a new market cap of 257,855,635. Then take this figure and divide it by current O/S of 9,408,815 and you get a fair PPS of $27.41. Thus, the market has way overreacted.

    Under method (2), we use a percentage basis. The dilutive market cap of 295,220,375 is 95% of the non-dilutive market cap of 310,220,375. Thus to reconcile this against the fair price of $29 before the shelf announcement, we just multiple this figure by .95 and get a fair PPS of $27.55. Thus, the market has way overreacted.

    Whichever method you use, you can see the result is about the same.

    This methodology obviously is very dependent on the assumption that the company wouldn't issue any new shares under $20. Do you think that is a fair assumption? If the company issues new shares for greater than $20, then this overreaction is even more unreasonable but, remember, I was just trying to be conservative.

    I hope this makes sense.

    **** I should note that in my article I only used Method 1 above.
    **** Also, I worked out all the math in a way that would easily allow investors to quantify the impact of the shelf if at some future point the company announces how much stock they are selling and at what price. You'd simply just plug that data into the formula in my article, to be expected soon. (It's a premium article, so you can't view it on my instablog, or at all, until publication).
    Feb 10, 2011. 06:16 PM | 1 Like Like |Link to Comment
  • Will New Inventory Strategy at Ross Stores Pack Away Profitability in 2011? [View article]
    For anyone else not familiar with what "packaway" inventory is, this was taken from the company's filings:

    "We purchase manufacturer overruns and canceled orders both during and at the end of a season which are referred to as "packaway" inventory. Packaway inventory is purchased with the intent that it will be stored in our warehouses until a later date, which may even be the beginning of the same selling season in the following year."

    Forgive me if it's a commonplace term in the retail space. I had never heard of it and a Google search seemed only to bring up results relevant to Ross Stores, so I thought maybe it was a term they themselves coined with respect to this context.
    Feb 10, 2011. 12:33 AM | 1 Like Like |Link to Comment
  • Kulicke and Soffa: Potential Upside or Ridiculous Upside? [View article]
    Thanks rapsteno. In the immediate term, look into ASYS, specifically with respect to its earnings to be released on Feb. 8th. With revenues of 52M (pre-announced), they should earn close to .50/sh on a diluted basis.

    Analysts are currently sleeping on a consensus estimate of .37, even with the pre-announced revenue figures. There's no other explanation for this, in my opinion, other than that they're not paying attention.
    Feb 1, 2011. 11:35 AM | Likes Like |Link to Comment
  • Kulicke and Soffa: Potential Upside or Ridiculous Upside? [View article]
    re: KLIC, at this point in time, I believe you'd be best served by waiting for this most recent appreciation to be confirmed, even if that means buying it higher than you otherwise could right now. I think Jesse Livermore put it best when he said, "Do not chase a stock if it gets away from you—let it go. [He] would rather wait and pay more, after the stock had regrouped and formed a new [consolidation base], because this [consolidation base] provides a confirmation and insurance that the stock will most likely continue with its move."

    I wish you could have gotten in sooner. I published this article on my instablog and the next morning pre-market came Oppenheimer's upgrade. You couldn't have bought it in the 7's even that morning as it was already trading in the 8's in pre-market. But let's wait and see how much faith the market gives this current run. Were I you, I'd want to see some consolidation and a new base before jumping in, especially considering how much KLIC's appreciated in recent days.

    re: CELM, CBEH, and SVU, let me take a look into them and see which, if any, need to be weeded out and then perhaps we can entertain some dialogue on the remaining candidate(s). I'll get back to you soon here on this thread.
    Jan 16, 2011. 01:20 PM | Likes Like |Link to Comment
  • Kulicke and Soffa: Potential Upside or Ridiculous Upside? [View article]
    Thanks cowpie. I'm excited to hear that you made some money on KLIC. I believe there will be many more opportunities to pick up undervalued companies in this space throughout 2011. Please stay tuned for more.
    Jan 16, 2011. 12:42 PM | Likes Like |Link to Comment
  • Kulicke and Soffa: Potential Upside or Ridiculous Upside? [View article]
    If price isn't a function of either earnings or growth, what is it a function of?

    Also, do you have anything of value to add to the discussion?
    Jan 16, 2011. 12:41 PM | Likes Like |Link to Comment
  • Kulicke and Soffa: Potential Upside or Ridiculous Upside? [View article]
    Thanks for the comment. The transition from Gold to Copper may be the best thing KLIC's seen in years, I completely agree.
    Jan 16, 2011. 12:40 PM | Likes Like |Link to Comment