Redman''s

[Jman9000]

APBS - Yes, I did see that they thought the bridge wouldn't be an issue going forward, however thanks for your explanation...was having trouble visualizing it.

Have you opened a position yet? The financials on this one, if everything is legit, are pretty darn impressive. If they can expand and can price because of lack of real competition, the numbers could be staggering.

With that said, I'm still considering the issue with cash flow. You'd think with those kind of margins that they'd be able self-fund the expansion.

Have you seen any info on IR? I'd like to ask the question and see what kind of answer I get.

Jeremy

[Jman9000]

Fernando,

I followed you out of LLEN today as well...I've been itching to sell yesterday but just felt there was a little more left. Once I saw you get out and a few of the others chime in, I did the same.

Overall, I will saw I am grateful for both of you guys and others for sharing ideas on IHUB. Those ideas, both the stocks and the process, combined with a lot of book reading has made a night/day improvement on my ability to manage my investments. Back last may I was actually considering hiring someone to do it....

If interested, my new entrant in my top 7 is LIWA. I had a partial position but filled it out on the dip.

Jman

[redman_2014]

APBS - entrances

I'm sure the cemetery itself has many entrances, but the 8-K read as though it was a main access road farther out. It did mention that the road will eventually be connected to the main highway and that further disruptions are unlikely.


-Adam

[redman_2014]

APBS - choppy results

1) The FY2009 results had negative growth because a bridge on the main access road to the cemetery was being upgraded due to the Three Gorges Dam raising the water level of the region and therefore was shutdown for a while.

2) I do not know the exact reason for them projecting a drop in income for 2012 but my guess is it has to do with the expansion of phase three and the extra costs involved.

3) They may have to purchase the 70+ extra acres, unsure as of now. If they did it probably wouldn't cost much more than $12M if the cost/per acre is similar to the land they purchased for $2M.

4) The $10M capital raise is an issue for me aswell, but the uplisting will help avoid a poor deal.


I am still searching for info on this one since it's still fairly new. I haven't started a position but I think it has more potential than it seems at first glance. There are a lot of upfront costs involved with cemeteries and they are still in the development stages but are quite profitable nonetheless. Based on the projections I don't think they accounted for much of their intended price increase to $7,500 so their could be some hidden upside potential. I have to work the numbers some more to see if that's the case.


-Adam

[Drexion2004]

APBS: Hmmm, weird I agree. Do they project another Bridge problem in 2012? =P.

-Fernando

[Jman9000]

APBS

In the 8K, it explained that the sharp volume drop in 2009 was driven by some construction on a bridge that limited access to the cemetary that has since been completed.

It sounded a little odd. While I haven't been there to see it first hand, every cemetary (admittedly not that many) I have been to has had multiple entrances. I'm not sure I believe that a bridge can have that sizable of an impact, but I don't really know for sure.

Jman

[Drexion2004]

Their projections in the powerpoint are a bit puzzling.

FY 2008 vs FY 2009 had negative growth. Then in FY 2010 they had a very nice jump...Then look at their projections, they expect 2011 to do quite well relative to 2010, but then expect a drop for 2012 again (Net income drop, revenue increase, how can margins go down if they are raising prices)?

Personally I do not like this weird growth pattern they are projecting.

Furthermore, if you look at how they plan to use the proceeds of the capital raise...2M is to buy 11.53 acres, moving farmers out of the land, etc. Given this information it sure does not seem they OWN the 94 acres in the 'cemetery operations'. They seem to only own the Foguang and GuiYuan sections, with everything else being 'options' they need to pay(ie: buy) for.

They also state they plan to raise an additional 10M soon when they uplist...

I'll pass on this one.

-Fernando

[Drexion2004]

Presentation: http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=7072884-6997-11113&type=sect&dcn=0001213900-10-000681

-Fernando

[Jman9000]

APBS Good recap. The info on land is particularly interesting especially if competition is largely capped as they indicated.

The link for the pres didn't work for me though. Where did you get it from?

Jman

[redman_2014]

APBS - Growth, Cash Flow, and Land

1) Growth strategy - They plan on revenue growth of 25%. They plan on continuing to sell plots in the second phase of the cemetery development project, and continue development of the third phase. Presently their average selling price per unit is $4,750, and they wish to increase this to $7,500(Urban cemeteries command upwards of $10,000 per unit). They mention it's not unusual for a graveyard plot to be more expensive than a home. They consider themselvea a premier destination which should help command the higher price. Acquisitions are a longer-term strategy, as is their Long Qiau lake tourism project(not sure what their intentions are with this).

2) Good question. Not 100% sure about the low cash flow. Will have to dig deeper. As for the inventory re-evaluation, I think it just means they sold off some finished plots. I agree the explanation is odd. This inventory definition is from the 8K - Inventory consists of completed cemetery plots ready for sale. Inventory includes all direct costs associated with land development and construction of cemetery plots, including interest, costs of land use rights based on units of production and other carrying costs incurred. Inventory is valued at the lower of cost or market (determined on a weighted average cost basis) or net realizable value.

3) Land - Total available land for cemetery development is 94 acres. A little over 18 acres has been developed so far: 100% of Foguang(7.2 acres), 93% developed GuiYuan 1(11.5 acres), and 3% developed GuiYuan 2(11.5 acres). They have land-use rights on the remaining 70 acres granted by the local government which they intend to develop(they pay $22,000 per year for the rights). That leaves 80% of total cemetery acreage available for future development.


Sidenote: Gross margin was 42.6% in FY2008, 45.7% in FY2009, and 54% in the first nine months of FY2010. They have projected the gross margin to be 55.1% for FY2011. They have slowly been increasing their average price per unit and margins will improve dramatically if they can get anywhere close to the $7,500 per unit since thats a 58% price increase from $4,750.


Rough Valuation:(FY ends March 31st)
Share Count: 11M(13.4M with warrants included)
FY2010E Net Income: $12.1M
Expected 2010 EPS: $1.10(0.90 diluted)
Present Share price: $4.30
PE of 3.9(4.78 diluted) Margin of safety is there especially since its a steady consistent earner(especially with their plans for uplisting). Not a lot of surprises with a cemetery.



Investor Presentation
http://app.quotemedia.com/quotetools/showFiling.go?webmasterId=95523&name=ARTISTRY%20PUBLICATIONS%20INC:%208-K,%20Sub-Doc%202&link=http%3A//quotemedia.10kwizard.com/filing.xml%3Frid%3D12%26ipage%3D6781454%26DSEQ%3D2%26SQDESC%3DSECTION_EXHIBIT%26doc%3D2&cp=on&type=HTML



-Adam

[Jman9000]

APBS: I took a look at this one. Overall, earnings for 9 months look pretty good, giving the impression of undervaluation. A few thoughts/concerns though:

1) Growth strategy: Is the plan to grow via acquisition? I'm not sure what type of synergies would be realized with growth. The only way that I can see growth funded by capital as accretive is if acquisitions are bought at very favorable price multiples.

2) Cash flow: For a company that has generated ~$10M in net income through 9 months, a $3.2M cash flow seems light, especially on a sold to consumer industry where accounts receivable should be nil...although there could be some customer financing plan. I didn't see a detailed balance sheet though or any specific commentary on A/R or inventory. The weird thing is that the company explained the cash flow as inventory revaluation vs. some function of earnings.

3) Land: Company referenced competitors and how many plots were left, but didn't see any mention of how many plots were available in the companies two cemetaries.

Not sure how I feel about this one. Land is a moat perhaps, but wonder how well a brand can be extended in this space. If they are able to get good deals on potential acquisitions, they might be successful...if not though, not sure what the growth algorithm looks like.

Jman

[Drexion2004]

I'm just chuckling over how we three seem to think alike in our favorites :D. We might have small differences here or there but overall the thinking is amazingly similar.

-Fernando

[redman_2014]

Our investing criterium must be similar.

I'm not in PUDA right now either but probably will be after the next financing. Was in LLEN but sold it all to buy PUDA under $5.

NEP should probably be on my list and I owned it back when it made it's move from $7 to $11 but sold out to lock in gains. Have been tempted to get back in but there always seems to be something cheaper around.

Haven't done much dd on CHOP.

I took a serious look at YONG last week but didn't pull the trigger. A little regrettable now after today's pop. It's another one I'm looking at.


-Adam

[Jman9000]

Interesting....you have 4 of my top 7 holdings in your list (CCLWF, CCME are my top 2, SOKF & CNYD also in my top 7). My other top 7 that you don't have are CHOP, NEP, and LLEN.

I sold out of PUDA @ $9.50 in recent runup. I'm interested back in the ~$8 range and also will be watching news of next financing closely. I don't own LPIH (don't like them despite valuation) and never heard of APBS, so I'll be doing some research.

Jman

[redman_2014]

CCME CNYD CCLTF/CCLWF LPIH PUDA SOKF APBS

Please feel free to post info on any of the following.

You may also post about other stocks which you believe are of very high quality in terms of value/management/competitive advantage/sustainability/predictability/growth etc. Please state your reason(s) when posting

Thanks,


Adam

[redman_2014]

New use for this board - Info Archive.

I have decided to discontinue posting my trades on this board. I usually build a position over time and I found it inhibitive to update this board in mid-stream, and then found it burdensome to go back and search out the specifics of each trade in order to post them here.

Instead I am going to use this board as an archive of information about each of the companies I am interested in. That will allow quick reference whenever asked a question or if quick decisions need to be made.

Others can post info here whenever they want. I will list the companies I am following in a sticky note, so any relevent info regarding those companies can be freely posted.

Thanks for understanding,


Adam

[Stockplucks]

Congrats on the rebalance. Exhibit A on why it is smart to diversify. Of course, I am hoping CCME catches up quickly. To be honest, CNYD ran into earnings as I hoped CCME would as well.

[soulstealer]

guess you were right. :) No pullback looks like. Warrants would probably gap up 15-20% here tomorrow. Happy to be holding at least some from before. Hope to see 2.50~3 bucks on warrants soon. Gl.

[redman_2014]

Bought 5,000 LPIH @ 2.09

Never thought it would get this low again, but glad it did.

[redman_2014]

Bought 10,000 CCLWF @ 1.33.

[redman_2014]

I'm hoping for a pullback aswell so I can average down, but not sure if it will happen so that's why I started buying today. I know of quite a few individuals who are looking to buy lower, so demand may be too much to see any significant dip. The common is selling too cheap right now - 2.5 to 3 trailing p/e is extremely undervalued, especially for a growth stock.


-Adam

[soulstealer]

ah..so that was you buying it up there. I am hoping for a pullback, to add to existing position. Good buy though, with earnings on march 31st, should get on everyone's radar then.

[redman_2014]

Bought 30,000 CCLWF @ 1.34

Started a position. A little late to this one and had to pay up a bit, but the underlying value of the common(CCLTF) easily allowed for this price and wasn't sure if I would get it any cheaper in the coming days and weeks.

$7.5 strike price.
2.5 yr timeframe.

10M shares outstanding
$7 common stock price
$70M market cap
$23.7M expected 2009 net income
3x trailing P/E

Trailing P/E of 6 takes common to $14/share, and warrants to $6.5/share minimum. That's a 100% and 385% appreciation respectively.

-Adam

[redman_2014]

Cash Level - $60,000.

Expecting a market pullback any day now. Keeping most of my Puda profits as dry powder just in case something really sells off.


-Adam

[redman_2014]

Bought 7000 LPIH @ 2.28.

Almost have a full position. If it gets back to the low $2.20's I will buy the rest.

[redman_2014]

Sold 6400 PUDA @ 10.50

Sold my remaining Puda position due to being up over 100% in a little over two weeks. If it drops into the $8's I will consider buying back in, but right now had much more attractive places to put the money.


-Adam

[maani]

All good picks backed by financials I like it.

[maani]

Hey Redman check this chinese stock SPU(7.04)
Company expects revenue of $92-$102 million and net income of $19-$21 for FY2010
They also announced their preliminary earnings for FY2009 revenue of $58-$60 million and net income of $15-$16 million.

According to last 10Q they had 19 million shares outstanding diluted however I think it's 21 million now because of warrants conversion from which they raised $6.7 million

They are set to present at ROTH conference on March 16th 2009 and ROTH capital already has a buy on stock with $12 price target. I think they will report their full year earnings before it.

They are the only chinese beverage concentrated juice company listed on major exchange in USA.

Last year COKE bought a chinese juice company with $375 million revenue for $2.4 billion and this company could become a buyout candidate for having a market cap of less than 150 million.

Chart

[redman_2014]

Bought 12,000 LPIH @ Avg 2.24.

They will earn $50+ net income in their FY2011 beginning in July/2010. That allows for a $5 fair value this year. Has over 100% upside potential with very little downside pressure left. Even with massive selling pressure it has been pretty firm above $2.20, so I am considering it a bottom.


-Adam

[redman_2014]

Sold 3000 PUDA @ Avg 9.61

Sitting on an almost 100% gain with only a 20% to 50% upside potential left(I believe fair value is $12 to $15 right now). Keeping 6400 for now because of 2011, but I was under-weighted in LPIH so decided to switch some funds over into it. The 6,400 is all profit from PUDA now.

-Adam

[bunky]

RED...i agree..do not understand JOE selling with .30 gain when hopefully next wk, we see very positive news...sure hope so...bot another 2300sh today...way overextended...be broke or very happy...its only $ and can not buy good Health/Happiness with it anyway


BOH


Thanks for you excellent DD


CharlieB

[redman_2014]

Bought 1700 CCME @ 11.90

[redman_2014]

Bought 5000 LPIH @ 2.28

[redman_2014]

Sold 3500 PUDA @ 9.35

Hate to recind what I said before about not selling, but didn't expect it to be up another 25% in a few days. Will buy back on a dip to re-fill position.

Standing doctrine: If it runs to high to fast will always sell a portion, even if it's not yet at fair value. Lock in profits then by back lower if possible.

[Stockplucks]

You're welcome.

I had not seen your ibox until now. WOW. Congrats on your portfolio. I don't want to jinx you but it appears to me you are about to become a millionaire soon, like by the end of this month!

[redman_2014]

Thanks for the remarks.

If you look at my ibox you will see I still own more CCME than CNYD, albeit not a lot more. It was just rebalancing since I was really heavy into CCME.


-Adam

[Stockplucks]

Congrats Redman.

Looks like you made a lot of great trades. You are a man that puts his money where his mouth is. I mean that in a good way!!!

Great job. I enjoy your posts. Although I'm the other way, much more in CCME than CNYD. Appears CNYD is poised to pass CCME....at least for now. lol

[redman_2014]

Bought 1000 CNYD @ 11.50.

Have a full position now unless it gets considerably cheaper.


Sidenote: Will not touch the remaining 13,000 PUDA shares until it is over $15/share.


-Adam

[redman_2014]

Sold 1500 PUDA @ 7.62.

Difficult decision but I'm up over 50% and needed the cash to finish out my CNYD position, and I believe CNYD has more potential upside at present valuations with more transparent revenue and earnings.


-Adam

[redman_2014]

Bought 1000 CNYD @ 11.48.

[redman_2014]

Sold 1000 CCME @ 11.90.

Still rebalancing.

[redman_2014]

Bought 1000 LPIH @ 2.26.


-Adam

[redman_2014]

Bought 4500 CNYD @ Avg 11.47.

Rebalance of portfolio. Consider CNYD an equally attractive investment(or better) than CCME, and changed weightings to account for this attractiveness.

Really like the lower market cap($225M) compared to CCME($460M) which will allow for a 300% appreciation before hitting the psychological $1B market cap, compared to 117% appreciation for CCME.


-Adam

[redman_2014]

Sold 4500 CCME @ Avg 11.81.

Rebalancing portfolio to take advantage of low CYND price.


-Adam

[redman_2014]

The Reason For This Board

This board is my way of making my investing decisions publicly accountable.

By subjecting my decisions to potential scrutiny, I am forced to dig deeper and do ever more diligent and comprehensive research

in order to make sure I can defend the eventual decisions I make. Please feel free to question all you see and poke holes where necessary.

Thanks,

-Adam

[redman_2014]

Bought 1000 CNYD @ 11.25

Already own too much, but couldn't resist.


-Adam

[redman_2014]

Sold 3000 CPBY @ 4.80

Better bargains available now, so freeing up some cash to take advantage.

-Adam

[redman_2014]

Bought 1000 CNYD @ 11.25

Couldn't resist buying $0.25 below recent offering.

-Adam

[redman_2014]

Sold 1000 CCME @11.71

To take advantage of the low price on CNYD.

-Adam

[redman_2014]

Bought 3000 CPBY @ 4.84


-Adam