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Fushi announces upcoming follow-on offering

|Includes: Fushi Copperweld, Inc. (FSIN)
Fushi announces upcoming follow-on offering
 
Fushi Copperweld (NASDAQGS: FSIN) announced an upcoming follow-on offering in their Jan. 15 press release. The company said they will be offering 5mn common shares of which the net proceeds will be used for debt repayment and working capital. Fushi previously filed a shelf registration on July 6 last year giving them an upper fund raising limit about US$100mn.  Jefferies is the sole book runner, with Roth Capital as co-lead, and Rodman as co-manager.
 
Analysts who cover the stock look for positive developments in 2010. Despite YE’09 revenue estimates contracting 22.3% to $180.5mn ($221mn YE’08), YE’10 revenues are expected to reach $232mn.   Analyst EPS estimates look for 76cents YE’09 (down -18.5% from YE’08) and $1.23 YE’10 (28% growth yoy). Based on a current share price of $10.51 (Jan 15), PE valuations are 15.31ttm, 13.8 YE’09, and 8.5 YE’10. Depending on how pricing plays out this could be approximately a $50mn capital raise. 30 day vwap share price is trading at about $10.
 
Stock Summary
Price (Jan15): 10.5
Price 1d % chg: -3.58%
Price 5d % chg: -4.11%
Price Ytd % chg: +3.85%
Avg Vol (30d): 141,493
Mkt Cap: 295.66mn
PE (ttm): 15.28
EPS (ttm): 0.65
52wk Range: 4.06 – 11.34
 
Previous transactions
1.       07/06/09, Shelf filing, Universal, $100mn
2.       2/26/09, PIPE, Common stock, $1.92mn
3.       10/30/07, PIPE, Common stock, $38mn
4.       1/24/07, PIPE, Convertible senior secured (3.12%, 01/25/12), $20mn
5.       12/13/05, PIPE, Convertible preferred, $12mn
 
 
By: Nathan Wright
January 20, 2010
 
Data sources: PR Newswire, Capital IQ, Placement Tracker


Disclosure: Disclosure: The author does not currently hold any positions in FSIN