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John Sheehy

 
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  • Viewtran: About To View Large Tax Bill? [View article]
    You deserve credit for identifying the areas where you could be wrong. It is not possible to determine from publicly available information how much taxable gain (if any) was realized from the sales and whether taxable gain (if any) was received in 2013 by a US taxpaying entity. COGO/VIEW have used good quality advisors so I would be surprised if they made the relatively simple error that you describe, but I don't think it can proven or disproven.
    Aug 18 09:38 AM | Likes Like |Link to Comment
  • Viewtran: About To View Large Tax Bill? [View article]
    Can you show the connection (if any) between the numbers in your article and the 2013 audited YE financial statements? The transactions you refer to were completed before the end of 2013 and the 2013 GAAP year-end financial statements do not show any capital gain on the disposals. I believe the disposals were executed at approximately the book value of the assets sold. It's possible that the tax basis of the assets sold could have been different from the book value, but that does not seem to be your thesis.

    Are you alleging that KPMG (Viewtran's external auditor) is unaware of the very basic tax issue that is the subject of your thesis?
    Aug 15 04:43 PM | Likes Like |Link to Comment
  • China XD Plastics: When The Numbers Don't Add Up, There's Over 80% Downside [View article]
    It does not appear that you really addressed most of my questions.

    The implausible suggestion that Morgan Stanley Private Equity is a money laundering operation does not seem to explain why they would invest $100mm in this company and waive their redemption right. Is money laundering so incredibly lucrative that it could justify the loss of a $100mm investment plus all the subsequent legal and reputational risks? The fact that Morgan Stanley assisted in preparation of CXDC's IR Presentation is not evidence of fraud.

    What about the KPMG audit? CXDC is paying over $1mm/year in fees. Do you believe KPMG is also involved in the money-laundering operation?

    It's silly to fault the limits of the research conducted by S&P/KMPG/MSPEA/F&a... when the article is founded on the author's own ignorance.

    What is really the short thesis here? The regulatory filings from 2010? The business doesn't exist (no evidence presented)? The margins are higher than the expected (based on his own erroneous calculation)? Limited Google English language search results for the parent company name? Taylor Zhang didn't return his phone call?
    Jul 10 11:14 AM | 3 Likes Like |Link to Comment
  • China XD Plastics: When The Numbers Don't Add Up, There's Over 80% Downside [View article]
    What do you think about Morgan Stanley Private Equity investing $100mm into this company? The original deal had a 2014 redemption option, but they waived it last year.

    What do you think about the KPMG audit?

    What do you think about the S&P bond rating?

    What do you think about the Frost & Sullivan industry analysis?

    If you are right, then all of those investors, auditors, and analysts are wrong. Maybe they didn't to check the company's website...
    Jul 10 10:18 AM | 9 Likes Like |Link to Comment
  • China XD Plastics: When The Numbers Don't Add Up, There's Over 80% Downside [View article]
    So your primary sources are 3 year old SA articles?

    Your Gross margin table includes basic math errors.
    Jul 10 09:16 AM | 9 Likes Like |Link to Comment
  • Lentuo International Related Party's Undisclosed RMB 250 Million Debt Issuance Raises Red Flag [View article]
    If the translation you have provided is correct then I don't see where the VIE revenues or the LAS shares are designated as collateral for the trusts.

    If the translation you have provided is correct then it appears that Guo provided an unlimited personal guarantee and the documents describe his businesses and assets, but those assets do not appear to be directly pledged as collateral. The difference is that if a borrowing entity defaults then a lender can take possession of collateral ahead of other creditors even if the borrower is still solvent. Without security the lender would have to take Guo to court, force him into bankruptcy, and seek a liquidation of all his assets. In such a case it would be theoretically possible that the nature of the VIE agreement could be disputed in court. But I think that's a different and more remote risk than the one you described in your article.
    May 29 05:41 PM | Likes Like |Link to Comment
  • China Automotive Systems: Rare And Undervalued Chinese Industrial Success [View article]
    Investors should be aware that your target price equates to a P/E multiple higher than any Chinese auto or auto parts maker except BYD. Do you feel that the entire sector is undervalued or do you feel that CAAS deserves a significant premium valuation?
    May 29 08:51 AM | 1 Like Like |Link to Comment
  • China Xiniya Fashion's CFO Answers Questions About The Recently Concluded Sales Fair And Current Industry Environment [View article]
    I wasn't planning on publishing an update. I only wrote articles about this stock and others when I had some unique information to share. I currently own XNY stock, but I don't have anything to say that you can't find by studying the sources mentioned in my introduction (interested investors should read the company's Presentation, Annual Report, and become familiar with other Chinese menswear brands listed in Hong Kong and China (for example, financial reporting on HK-listed companies like Lilang is available in English through the HKEX Website). The industry downturn seems to be ending so we'll see what 2014 brings.
    May 14 10:09 AM | Likes Like |Link to Comment
  • Xinyuan Real Estate Property Visit Highlights Promising Outlook [View article]
    News is available at the XIN website:
    http://bit.ly/1bCgAgd

    As mentioned in the introduction, investors interested in Xinyuan should become familiar with Chinese real estate developers listed in Hong Kong. Industry sales have weakened in 2014 and the sector is extremely out of favor. The following is a sampling of HK ticker symbols of RE companies current trading at less than 4X analyst estimates of 2014 EPS: 3333, 3383, 3900, 1918, 1638, 1813, 0081, 0884, 0832, 1224, 1628, 1777, 3883, and 2868.

    I think XIN's share price decline over the past 6 months is largely attributable to industry trends rather than any company specific developments.
    Apr 30 09:06 PM | 4 Likes Like |Link to Comment
  • China Xiniya Fashion Store Visits Reveal Efficient Business Model And Long-Term Opportunities [View article]
    I understand the source of your information and I understand your math, but I think that number is irrelevant. All outstanding ADS are available for trading at the NYSE, regardless of whether they were issued in the IPO or converted from ordinary shares by pre-IPO investors. Just look at the daily turnover for the past year. There is obviously enough liquidity for execution of a new buyback plan.
    Mar 7 05:06 PM | Likes Like |Link to Comment
  • China Xiniya Fashion Store Visits Reveal Efficient Business Model And Long-Term Opportunities [View article]
    The 20-F says there are 21mm ADS:

    " As of December 31, 2012, we had 227,716,692 ordinary shares outstanding, including 85,399,472 ordinary shares represented by 21,349,868 ADSs. All ADSs are freely transferable without restriction or additional registration under the Securities Act of 1933, as amended, or the Securities Act. "
    Mar 7 10:08 AM | Likes Like |Link to Comment
  • China Xiniya Fashion Store Visits Reveal Efficient Business Model And Long-Term Opportunities [View article]
    It is my understanding that the CEO felt that the completed share repurchase plan was unsuccessful because it did not lead to an increase in the price of the stock. I disagree with that logic and have communicated my perspective directly to the company. I urge other shareholders and interested investors to do the same.
    Mar 7 09:32 AM | Likes Like |Link to Comment
  • China Telecom's $400mm Medical Smartphone Agreement Is Great News For China Techfaith Wireless [View article]
    There's a more detailed story in the current issue of The Economist:
    http://econ.st/1frkOGo

    Excerpt:

    "Many experiments are already under way in emerging markets, where new mobile devices and apps are helping relieve pressure on poorly financed and ill-equipped clinics and hospitals. But the biggest prize is America, which splashes out a breathtaking $2.8 trillion each year on a health-care system riddled with inefficiencies. The prospect of revolutionising the way care is delivered there is inspiring entrepreneurs. Mercom Capital Group, a consulting firm, reckons that of the $2.2 billion venture capitalists put into health-care startups last year, mostly in America, $564m went to m-health businesses.

    The m-health market can be broken down into two broad categories. First, there are the apps and appliances used to monitor the wearer’s physical fitness. Firms such as Nike, Fitbit and Jawbone make wristbands and other wearable gadgets full of sensors that let people record their performance, and their calorie-burning, as they pound the pavement or sweat in the gym.

    Second, other apps and devices link patients with a medical condition to the health-care system. Last month Google said it was working on a contact lens containing a tiny wireless chip and sensors that would measure and transmit the glucose levels in a diabetic patient’s tears. In December Apple was granted an American patent on a means to incorporate a heartbeat sensor into its devices."
    Feb 4 09:50 AM | Likes Like |Link to Comment
  • China Telecom's $400mm Medical Smartphone Agreement Is Great News For China Techfaith Wireless [View article]
    Media reports say Apple and Google have been meeting with the FDA to discuss mobile medical devices.

    http://nyti.ms/1esPKrZ

    http://bloom.bg/1esPLMu

    This suggests that they see a large potential market for mobile health monitoring devices. If Lifewatch IP is valuable then it could be acquired this year.

    What does this mean for Techfaith? At this point I don't know.
    Feb 3 10:44 AM | Likes Like |Link to Comment
  • China Telecom's $400mm Medical Smartphone Agreement Is Great News For China Techfaith Wireless [View article]
    Thanks for your comment.
    My understanding is that the first version produced in 2012 took too long in getting regulatory approval as a medical device. By the time it was approved the phone specs were unappealing. With that experience the companies have tried to streamline the process. It will be an ongoing challenge, but it will also limit competition.
    The health phone attracted favorable publicity and recently won an innovation award:
    http://bit.ly/1mXrwa1
    But consumer acceptance is the real test and that's why I think the China Telecom agreement is a significant development.
    Techfaith is also getting a lot of publicity through promotion of a ruggedized phone in conjunction with The Travel Channel (a satellite network):
    http://bit.ly/1mXrv5Y
    These niches (health and sports) should be complimentary. Each success enhances the reputation of the brand in the Chinese market.
    Jan 29 09:55 AM | Likes Like |Link to Comment
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