MegaEurope (< 20)

24 Comments – Post Your Own

#1) On October 13, 2010 at 11:08 PM, MegaEurope (< 20) wrote:

For the first article, here is a better link (including the blog comments): http://seekingalpha.com/article/229286-how-to-invest-in-chinese-reverse-mergers-part-ii

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#2) On October 14, 2010 at 3:14 AM, throwerw (30.69) wrote:

CCME last day on the Reg SHO list, the party is only just getting started

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#3) On October 15, 2010 at 1:16 PM, fiesta0923 (50.48) wrote:

TPI no longer pays a dividend, I wish Yahoo Finance and other sites would update this, but I guess it won't happen until '11, as the last payout was in Jan'10.  I've had the stock for about two years now, but it hasn't done anything good in the past 6 months.  Holding onto for the long term due to impressive reporting and financials, but no longer buying. 

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#4) On October 15, 2010 at 4:15 PM, MegaEurope (< 20) wrote:

Thanks for the info fiesta.  I think previously paying a dividend is still a good signal of quality although not nearly as good as an ongoing dividend.

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#5) On October 16, 2010 at 1:10 AM, MegaEurope (< 20) wrote:

Companies with majority insider ownership:
SPU, CREG, TBV, CFSG, LPH, SUTR, ALN, CAAS, RINO, JNGW

Companies with 20-50% insider ownership:
SIHI, CSGH, CWS, PUDA, TPI, SCOK, CPHI, FUQI, CEU, CMFO, SDTH, CCME, FSIN, CNIT, SVA, CRTP, CSKI, NIV, HRBN, JADA, TSTC, CPSL, CGA, CCLTF, HOGS, BFAR, CNOA, CNGL, UTA, AOB

Companies with less than 20% insider ownership:
ABAT, CSR, CHGY, HEAT, CTFO, LIWA, AUTC, CBEH, etc.

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#6) On October 21, 2010 at 7:45 PM, MegaEurope (< 20) wrote:

CYD had a big day today, up 11% on very heavy (unexplained) volume.  I own shares and calls making up around 6% of my portfolio.  I still think it is very attractive (on a pullback, perhaps).

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#7) On October 25, 2010 at 7:22 PM, MegaEurope (< 20) wrote:

CBEH announced last week they were having their first annual shareholder open house & tour of their new facility.  I'll try to find other companies that have had open houses.

CPC is another that had a one-time dividend.  That looks very cheap.

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#8) On November 06, 2010 at 7:01 PM, MegaEurope (< 20) wrote:

Some Chinese companies that are generating tons of free cash flow:

Ticker             P/FCF
CNOA.OB         2.0
CYD                 2.2
JADA.OB          4.1
CHGY.OB         4.9
CSKI                7.0
EDS                 8.6
CSGH.OB         8.8
CPC                 9.1
CEU                 9.7

Most of these are growing by double digits, but are generating so much cash that they can't invest it in their business fast enough.  I own shares of CNOA.OB, CYD, CPC and CEU.

I'll probably turn Chinese FCF into a separate blog post this week.

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#9) On November 11, 2010 at 12:23 PM, MegaEurope (< 20) wrote:

CPC announced today that their CEO made an offer to take them private at a nice premium.

My gain on CPC was fairly small, but like these other indications, another M&A event adds buying pressure to other quality Chinese smallcaps.

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#10) On November 11, 2010 at 12:25 PM, MegaEurope (< 20) wrote:

No new Chinese buybacks announced in the last couple of weeks however.  I wonder whether the Chinese companies which announced buybacks had an IR firm that suggested it to them.

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#11) On November 14, 2010 at 12:19 PM, MegaEurope (< 20) wrote:

ATV had a special dividend a few quarters ago.

I recently sold my CYD calls for a nice profit. But I have not sold any shares.

More high FCF companies:

Ticker        P/FCF

CNOA.OB         2.0
CYD                 2.2
RDBO.OB         3.0
WKBT.OB         3.0
DYP                  3.8
JADA.OB          4.1
CHGY.OB         4.9
CSKI                7.0
SOLF               7.3
CHBT               7.9
EDS                 8.6
CSGH.OB         8.8
CEU                 9.7

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#12) On November 14, 2010 at 11:47 PM, MegaEurope (< 20) wrote:

One day, a Chinese company might show up here: http://www.theonlineinvestor.com/mergers/

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#13) On November 20, 2010 at 12:53 PM, MegaEurope (< 20) wrote:

CPC is now trading around $7.50.  So with a buyout offer presumably going through at $8, this is a 6.6% arbitrage possibility.

I think the downside is low, in fact the company should be worth more than $8 a share.

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#14) On November 20, 2010 at 1:17 PM, MegaEurope (< 20) wrote:

China Pays Dividends - MCDFX likes Hong Kong and Singapore based companies, particularly in finance, real estate, infrastructure and telecom.

State firms urged to do more dividend spread - "The proportion of listed companies that paid cash dividend is increasing year after year," said Li Daxiao, director of the research department at Yingda Securities.

 

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#15) On November 20, 2010 at 1:58 PM, MegaEurope (< 20) wrote:

Cheap stocks ready to uplist

Chinese companies with over 20% ROI over the last 5 years:

BFAR.OB
LLEN
CYXN.OB
SGZH.OB - On a nice run in anticipation of their mine reopening
CBEH
CSWG.OB
LTUS.OB - Like BFAR and SGZH, certainly a strong uplist candidate
UTA
LPH
YUII
CNIT
CAAS
HPJ
CTFO
CRTP
JST

Of course, this is an indicator of quality and profitability, not necessarily shareholder friendliness.

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#16) On December 07, 2010 at 6:02 PM, MegaEurope (< 20) wrote:

CISG announced a buyback:

http://www.fool.com/investing/general/2010/12/03/cninsure-shares-popped-then-plunged-what-you-need-.aspx?source=itxsitmot0000001&lidx=2

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#17) On December 07, 2010 at 6:04 PM, MegaEurope (< 20) wrote:

CPC, which I have bought more of, will be my first ever merger arbitrage trade.  No news the past few weeks.

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#18) On December 07, 2010 at 6:05 PM, MegaEurope (< 20) wrote:

Or rather, buyout arbitrage.

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#19) On December 10, 2010 at 10:33 AM, MegaEurope (< 20) wrote:

CEU announced a buyback in response to their share price plummeting and class action lawsuits being announced.

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#20) On December 21, 2010 at 6:10 PM, MegaEurope (< 20) wrote:

CPC is now trading at $7.12. On the 10th, the board hired a financial advisor and legal counsel to examine the buyout offer and respond.

I think I will buy more shares, the 12% current discount to the $8 offer is enough that the annualized return from this trade could easily be 40%.  And I think the company is worth over $8 a share anyways.

CYD has been on fire lately, still holding my shares.

CBEH responded to a bearish article on Seeking Alpha and a few days later announced they were switching to a Big Four auditor.  I think they will perform well over the next year.

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#21) On March 11, 2011 at 7:45 PM, MegaEurope (< 20) wrote:

CRIC announced a share buyback yesterday.

CBEH announced their first Big 4 audited earnings, beat estimates and increased guidance for 2011. Still down today with the rest of the Chinese RTOs.

Like CPC, CSR was also considering going private.

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#22) On March 23, 2011 at 10:21 PM, MegaEurope (< 20) wrote:

CAST announced a buyback.

I expect CYD to announce their annual dividend in the next month.  They have had a significant pullback and it might be a good time to buy shares.

CBEH collapsed.  What a mess. I should have seen the warning signs.

Considering that CCME and CHBT announced share buybacks yet have been accused of fraud, I wonder how to confirm that share buybacks are actually taking place instead of just being announced.

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#23) On March 23, 2011 at 10:38 PM, MegaEurope (< 20) wrote:

TCM's private buyout should close soon.  I believe they were an IPO, not an RTO.

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#24) On April 11, 2011 at 10:00 AM, Huayra (< 20) wrote:

One good thing coming out of the recent Chinese RTO issues is that the companies whose businesses have been on the up-and-up now see the need for better communication to the market, a solid management team and a trustworthy auditor.

You'll see the bad apples being shaken out and the good one's return to a valuation corresponding to their intrinsic value. The only way for a small-cap company to really shield itself from a shortseller attack is by building credibility over time and by improving the company's coverage in the investment community.

Facts Speak Louder Than Words and Lies Will Collapse by Themselves

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