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Did 4 years of Army, now at McGill University(Montreal, Canada) in Commerce,
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  • Mike Koza Offering To Help GHII

    Shareholder Koza proposes to help Gold Horse International
    Mike Koza (12,7% shareholder) thinks Gold Horse may go dark because costs staying listed are bigger than the benefits (raising capital, image, etc...). He proposes to help them. Here is an excerpt from SC 13D/A he filed yesterday (Koza=Reporting Person):

    The Reporting Person may take actions as deemed appropriate, possibly in conjunction with other shareholders, including one or more of the following:

    1. Offering to pay all or part of the expenses (including back pay) of continued U.S. listing, including the re-hiring of Mr. Li (the fiscal year 2012 Chief Financial Officer) or an alternate Chief Financial Officer to be agreed upon;

    2. Encouraging the Issuer to make a tender offer for all outstanding shares;

    3. Assisting the Issuer in voluntarily deregistering its common stock, and arranging for the dissemination of periodic financial information to shareholders of the Issuer, in a simple format agreeable to the Issuer and shareholders. This outcome would be acceptable only if the SEC did not deny voluntary deregistration;

    4. Entering into negotiations with China-based shareholders of the Issuer to sell to these shareholders the shares owned by the Reporting Person. According to a Form 10-K filed by the Issuer on October 6, 2008, 36 individuals residing in China purchased 55,481 shares (split-adjusted) from the Issuer for $2,219,252 in 2007. The purchase price was $40 per share (split-adjusted). Although the reported book value per share of the Issuer has roughly doubled from December 31, 2007 to March 31, 2012, according to SEC filings, the Reporting Person would be willing to sell his shares to China-based shareholders at a significant discount to the amounts paid per share by these China-based shareholders in 2007. The Reporting Person believes that many of the China-based shareholders of the Issuer are employees of the Jin Ma Companies, which are controlled by the Issuer through contractual agreements;

    5. Assisting the Issuer in unwinding its variable-interest entity structure.

    Interesting development to watch closely. Koza's aggregate purchase price is around $1. His intentions are clear and for now very friendly. He wants to restore the real value of Gold Horse, no matter how.

    Tags: GHII, small cap, china
    Oct 21 5:21 PM | Link | 1 Comment
  • SUTOR, undervalued and profitable
    SUTR
    -They seem to have a conservative business model (They don't produce unless they get 30% down payment, which they say reduce Account Receivables bad debts.)
    -The are earning steady income
    -They're in China
    -averaged P/E over the last 3 years is at 3.1, Price to tangible book is at 0.45.
    -Not a loss in the last 5 quarters.
    -Current assets have been increasing over the last 2 years, and debt has gotten smaller.
    -A Buy-out is very possible for this company.


    Could be undervalued because of the recent hype over China's bubble bursting, but the business itself is running fine and management has a conservative salary. Plus it's a micro cap company, which could be the reason why it's overlooked by big firms.

    Recommends a Strong Buy.



    Disclosure: Long SUTR
    Tags: SUTR, PKX, CPSL
    Jul 06 2:56 PM | Link | Comment!
  • Fuwei Films Analysis, the accountancy point of view.
     http://quicktake.morningstar.com/StockNet/balance10.aspx?Country=USA&Symbol=FFHL

    You can see from these balance sheets taken from¸
    morningstar.com that this company has:

    106 millions assets(intangibles already substracted
    from this price)
    33 millions liabilities

    which gives you 75 millions on equity, the market cap today
    (29th May 2010) is at 12.54 millions,
    this gives you a price to book ratio of 0.17.

    Now a price to book that low could be excused if the company
    was loosing a lot of money or if it
    was very leveraged, but this company did neither.

    On this page you can see that from 2004 the company has only lost income last year, and has come back to profit last quarter and managent expect things to go for the better.

    Here is the last release of their quarter

    This stocks has got a lot of diluted shares but it is not enough to show such a low price for this company and I think that low volume of trade, a micro cap and a company that is not followed by analysts could be the reason for this price.

    Value investing is all about finding company that are poorly followed by analysts and finding where price and value have a large margin with a very substantial upside.

    We can say that a conservative price to book for a company that produce any kind of steady net income should be at least 1, with all intangibles discounted.

    If this company comes back to steady income, which is quite possible, its price should come back to a more reasonable price.

    The current price is at 0.96 and if it had a price to book of 1 it would have a price of 5.64$ which would show a good profit.

    That's it for my first post, look forward for a next one very soon about some other obscure company.

    Comments and opinions are welcomed and I will take them into account and maybe modify my
    posts from new informations I could get from them. I also have a small position into this company and all my following posts will mostly be about small micro cap companies that I have recently bought.

    Simon Garceau
    Accounting student at McGill university Montreal

    Follow my posts at darkeststocks.blogspot.com



    Disclosure: Long FFHL
    Tags: FFHL
    May 29 3:40 PM | Link | Comment!
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