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James Kar
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  • JADE could be a speculative trade ahead of Q2 earning announcement. 3 comments
    Jul 23, 2009 2:31 PM | about stocks: JADE, FUQI

    LJ International Inc (NASDAQ: JADE) designs, manufacturs and distributes its own jewelry brand called ENZO.  JADE sells its jewelry through jewelry stores, department stores and its own stores. JADE has 94 stores in mainland China, Hong Kong and Macau.  Amid the current economic environment.  It also wholesales to North America and for 2008, the North America markets account for 51% of its total sales. 

    JADE's main competitor is Fuqi International Inc (NASDAQ: FUQI), which is also located in China.  FUQI also designs precious metal jewelry and sells a range of luxury goods in China such as platinum and Karat gold chains.  FUQI has 69 retail counters and stores in China.  The stocks for jewelry manufacturers and sellers have been beaten down due to economc recessionary environment.  However, on July 22, 2009, JUQI announced that it expected Q2 earning would be at or above the high-end of earning estimates of $0.27-$0.32. The average consensus is $0.30. But at the same time, stock price falls because FUQI planned for more stock offering.  But today, the stock recovers signicantly.

    My speculative trade is JADE.  If FUQI can beat expected Q2 earning, JADE may be able to do the same.  Of course other investors have the same thought and bid up JADE to $2.07 (up 7.27%) at this writing or up about 10% for the last 2 days.  JADE is expected to announce Q2 earning on August 5.  If the stock falls back to around $1.90, I will buy the stocks as a speculative trade ahead of earning announcement. There is no Q2 earning estimates for JADE since JADE has no analyst coverage.  Therefore, if JADE could beat Q1 profit of $0.1, the stock may advance nicely. 

    Again , this is a highly risky speculative short-term trade.  But if you are a risk taker, JADE may worth the risk.

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Comments (3)
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  • Bob168
    , contributor
    Comments (6) | Send Message
     
    James: Your JADE is a great call. As you suggested and I bought some shares. Today it seems there are some institutional buying with more than 5x average volume. All these buyers must have the same thing in mind - better than expected earning on Aug 5. I might just sell it tomorrow if this continues instead of waiting for the actual results. I am not greedy and I am happy to take 20% profit in 10 days since your recommendation.

     

    thanks again.
    3 Aug 2009, 03:51 PM Reply Like
  • TheJazz
    , contributor
    Comments (2) | Send Message
     
    I've been reading some very bullish publications on this company. They are excellent at marketing themselves. With the most recent publication its apparent their intention is to double the amount of stores they have, in the next two years.

     

    I'm starting to look at JADE as a long term play, and would appreciate your opinion Mr. Kar on whether in two or three years you believe this company, can achieve their new growth strategy. In mind my if they do achieve it, a 2-3x increase in revenue and EPS is not out of the question.

     

    Thanks.
    15 Oct 2009, 09:43 PM Reply Like
  • TheJazz
    , contributor
    Comments (2) | Send Message
     
    One more thing today and yesterday JADE has been bought heavily, and is trading around $3.25. Technically it appears to have broken out.

     

    Great buy call hopefully people took your advice. Too bad I didn't stumble on this suggestion earlier.
    15 Oct 2009, 09:45 PM Reply Like
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