Iao Kun Group Holding Company Ltd. (NASDAQ:IKGH)

CAPS Rating: 1 out of 5

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Member Avatar jed71 (82.73) Submitted: 3/24/2015 11:01:15 AM : Underperform Start Price: $1.63 IKGH Score: -4.46

I am having a very difficult time believing this reverse merger company created out of a "blank check" shell corporation is a legitimate business:

"Iao Kun Group Holding Company Limited (formerly Asia Entertainment & Resources Ltd. and formerly CS China Acquisition Corp.) ("Iao Kun" or the “Company”) was incorporated in the Cayman Islands on September 24, 2007 as a blank check company whose objective was to acquire, through a share exchange, asset acquisition or other similar business combination, an operating business, or control of such operating business through contractual arrangements, that has its principal operations located in People’s Republic of China (“PRC”, “China”). On September 30, 2013, the Company changed its name from Asia Entertainment & Resources Ltd (“AERL”). The decision to change the name of the Company was to enhance the Company’s brand image in Macau.

On October 6, 2009, Iao Kun entered into a Stock Purchase Agreement, subsequently amended on November 10, 2009, December 9, 2009, January 11, 2010 and April 18, 2011 (the “Agreement”), with Asia Gaming & Resort Limited and its wholly owned subsidiaries (collectively “AGRL”) and Spring Fortune Investments Ltd. (“Spring Fortune”) that provided for the acquisition by Iao Kun from Spring Fortune of all of the outstanding capital stock of AGRL. On February 2, 2010, the acquisition was consummated pursuant to the terms of the Agreement, and AGRL became a wholly owned subsidiary of Iao Kun.

Upon the closing of the acquisition of AGRL by Iao Kun, the Promoter Companies (defined below) became variable interest entities (‘‘VIEs’’) of the subsidiaries of AGRL, which are the primary beneficiaries of the operations of the Promotion Entities (defined below) through the profit interest agreements which were entered into on February 2, 2010 and agreements subsequent to that date."

From an old filing,

"The acquisition has been accounted for as a "reverse merger" and recapitalization since the shareholder of AGRL (i) owns a majority of the outstanding ordinary shares of AERL, par value $0.0001 (the "Ordinary Shares") immediately following the completion of the transaction, and (ii) has significant influence and the ability to elect or appoint or to remove a majority of the members of the governing body of the combined entity, and AGRL's senior management dominates the management of the combined entity immediately following the completion of the transaction in accordance with the provision of Financial Accounting Standards Board Accounting Standards Codification ("FASB ASC") Topic 805 "Business Combinations"."

The outstanding account receivable balances are very strange. $210MM balance makes up the majority of their $367MM in total assets. I've had past run ins with very similar Asian firms, and none of them ever seem to end well. I would avoid this firm.

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Member Avatar clangmead (22.79) Submitted: 3/24/2015 7:26:22 AM : Underperform Start Price: $1.75 IKGH Score: +2.57

mjoe2

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Member Avatar stable52 (32.69) Submitted: 10/5/2013 5:14:59 AM : Outperform Start Price: $2.87 IKGH Score: -57.56

Currently undervalued in booming south Asian sector with significant long term growth potential

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Member Avatar mvwoolner (< 20) Submitted: 10/4/2013 5:52:56 PM : Outperform Start Price: $2.87 IKGH Score: -57.56

China economic activity on the rise again, AERL priced low

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Member Avatar MichaelHamilton (99.09) Submitted: 2/10/2013 5:54:31 PM : Outperform Start Price: $3.78 IKGH Score: -91.37

risky but interesting

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Member Avatar WakeUpInvestor (39.83) Submitted: 1/4/2013 7:31:36 PM : Outperform Start Price: $3.32 IKGH Score: -90.66

Dividend and dual listing in Hong Kong will lead to more investor's appetite.

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Member Avatar bencharlimike (< 20) Submitted: 5/11/2012 10:37:47 AM : Outperform Start Price: $4.84 IKGH Score: -116.06

profitable company. the gurus have been bad mouthing this stock so badly that it has PE multiple of under 3! OMG! earnings just came out and they delivered again, and they pay dividends of about 5%. great stock! buy. buy. buy

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Member Avatar starboy340 (< 20) Submitted: 5/2/2012 10:09:14 AM : Outperform Start Price: $5.30 IKGH Score: -115.25

This company has contracts with 3 large Macau casinos, has generated consistent growing earnings for 2 years, has paid dividends and anounced higher dividends for the upcoming year, and announces revenue monthly. It's current years earning is $2.00 with a price of under $6.00. For more info check the following link http://ir.aerlf.com/analystreports.cfm

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Member Avatar puthimon (< 20) Submitted: 12/29/2011 9:46:38 PM : Underperform Start Price: $5.29 IKGH Score: +131.60

AERL is a Bermuda triangle of issues that will likely end up in a delisting - 1.) it is a foreign-filer, 2.) it has material weaknesses in internal control over financial reporting, 3.) it really is a shell company with no assets and a very, very complex ownership structure that results in no protection for U.S. investors, 4.) it has absolutely no operations only profit sharing agreements on companies owned by Macau nationals that are also management, 5.) these profit share agreements are only enforceable in New York per agreements, Macau residents will ignore, 6.) cash stays in Macau-based companies which AERL has no interest in, 7.) AERL relies on arcane accounting to enable it to consolidate the results of companies it has no equity interest in, 8.) it is closely-held, 9.) formed out of a SPAC shell, 10.) etc., etc., etc.

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Member Avatar mrindependent (54.72) Submitted: 7/19/2011 5:50:30 PM : Outperform Start Price: $8.76 IKGH Score: -135.48

value screen

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Member Avatar kylehusky (< 20) Submitted: 7/7/2011 2:59:44 PM : Outperform Start Price: $6.77 IKGH Score: -126.97

I am very BULLISH on this stock base on my analysis:

1. Share buyback program: The company is buying back 2 million shares. There are only 9 million shares trading on public float.

2. Good future earnings: for AERL, the expected 2011 net income guidance range to be raised towards when Q2 results are released in the coming early August. All analysts are expecting good results so stay tuned for that.

3.   You get a decent 4% dividend yield while you wait and that’s very attractive to me. Very strong cash position and awesome fundamentals. It’s sooooo freakin’ cheap compare to MPEL, LVS, WYNN, or even MGM. Even if AERL reaches $12 per share it is still trading below 50% discount to its peers at 6x EBITA. That’s the reason I didn’t suggest you to keep chasing MPEL because now it’s trading at around $13 and EBITA is around 15x. If you compare to its peers, the fair value of AERL is around $20.

And at a technical standpoint, if you look at the chart, it has bottomed out at $5.5 and is currently at an uptrend movement with nice volume to support it.

For protection I’ve put a stop loss at around $7 with a target selling price of $13, then I will sell 50% and have the rest to sit until it reaches around $20.

This stock is an ultra strong buy as the casino revenue in Macau has already outperform Las Vegas, and it will continue to increase at a healthy rate.

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Member Avatar ChinaRTO (99.90) Submitted: 4/14/2011 3:17:34 AM : Underperform Start Price: $6.65 IKGH Score: +132.24

This is a tracking portfolio of all CAPS-ratable tickers in the Chinese RTO/SPAC space (i.e., companies that listed without filing an IPO).

Asia Entertainment & Resources Ltd. went public via a blank check (SPAC) merger in 2009. The company is based in Hong Kong.

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Member Avatar bigchange007 (< 20) Submitted: 11/5/2010 4:15:31 PM : Outperform Start Price: $9.63 IKGH Score: -150.75

Gaming stocks do very well when an economy is good, and the Asian -China economy is currently one of the hottest. Its news is good - no debt, low p/e,and d eps.

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Member Avatar pastordisaster (< 20) Submitted: 11/5/2010 3:42:22 PM : Underperform Start Price: $8.82 IKGH Score: +148.85

P/E 807.63

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Member Avatar alkoholiks (< 20) Submitted: 11/4/2010 4:14:11 PM : Outperform Start Price: $8.19 IKGH Score: -147.69

macau revenue will continue to increase at a healthy rate.

Results 1 - 15 of 15

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