is...hopefully making money
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Completely agree with the 4x 2011 earnings. My 5x earnings statement pertained to 2010 earnings forecasting the last two quarters. As per 2012 - who knows other than it is going to be huge. Their ROI is extraordinary and with the rapid expansion of airports in China and the prospect of accredited acquisitions and expansion into other advertising mediums (skymall type magazine, etc.) on the horizon, the growth could be truly mind boggling!
Let's hope so. Pile it on before the weekend and then get some good Monday morning news to keep the rally going. What a ride - it's hard to tell when this train is going to slow! I personally think we still have a lot of wind in our sails.
My recent email to management was very complimentary but also had a "good is the enemy of great" tone to it. I applauded the steps they have taken so far, but urged them not to become complacent as CCME's valuation improves. A dividend will push this puppy well into the $30's in the short term and provide even more sustainable valuation long into the future. I believe that CCME has the potential to be viewed as a Chinese "blue chip." I won't be happy until Cramer (what a dope) is honking his horns and screaming that the only two Chinese stocks he recommends are BIDU and CCME!
Bradford/Burp, I'm confident that like me, you guys already have ample reasons to hold this stock long term, but do you agree that a dividend for CCME makes all the sense in the world given their cash position and strong operational cashflow?
You know what the best part of today is? We are still only trading at 6.6 times ttm earnings and about 5 times expected 2010 earnings. Can we fast forward 12 months please? I want to see that extra comma in my account balance :)
I'm starting to get some of that 2009 nostalgia going on. Congrats to everyone that remained patient through the 6 months of beatings...it is definitely beginning to pay off in a big way!
As I type we've taken out $14!
They don't show up on the insider holdings on the financial sites - do they have to file an S-3 when they sell?
Let me also say that these continued actions are painting a picture of a company that "gets it." They are making excellent decisions to provide long term value for shareholders, which is something that most Chinese small caps do not do.
I think most CGS insiders would have just dumped the shares in the open market and dealt with the ramifications.
It seems to me that CCME is being coached by the right people to take them to the Big Leagues. When we get our dividend we will know that for sure, and we will savor it all the way to $30 and beyond.
I think this line sums it up best -
We are pleased that Starr International increased its investment in CME, which is indicative of their continued confidence in our business plan and growth prospects.
Anyone that thought Starr might be exiting their position or might have had its confidence in CCME rattled at all has been reasurred by this. They just upped their ante by another $13.5 million. These are guys that have direct access to the DAILY financials of CCME. What a powerful statement this purchase is. Also, you can be sure that they didn't buy it at $9 to sell it at $12. They are expecting a big return on this investment.
And CME did it the right way. Private placement. This avoids the controversy of an open S-3 filing and also avoids the price effect of dropping 1.5 million shares into the pool.
They effectively increased the float by 1.5 million shares, but did it by putting the shares in strong hands. This will help ease the concerns of those that were worried about the share buyback shrinking the float too much.
Great situation all around IMO.
$12.79 pre-market! WEEEEEEEEEEE
I'm pretty sure the shorts are thinking about how they need a fresh cup of coffee and a clean pair of shorts - couldn't resist the pun :)
I think that the most logical explanation for the short interest at this point in time is that a lot of fund managers are looking at the recent market rally and don't believe that the economic indicators paint a picture of a sustainable run. They are shorting everything that they can get their hands on, and focusing most heavily on the emerging markets which arguably stand to have the most price movement if the market were to tank.
I'm definitely not a perma-bull, but I do believe that the November elections and QE are going to keep the rally going or at least sustain the current levels for the short term. Either way, I think it is likely that CCME will continue to move upward irrespective of which direction the market moves unless there is a total collapse. The window is closing on the shorts and I think they are going to find themselves on the wrong side of history.
I hear what you are saying and I don't think that your estimates are unreasonable by any measure. The $40's are definitely possible, and depending on the actions of the company could be quite probable. My point is that the discount that many investors have come to accept with CGSs is unnecessary and easily reconciled. CCME seems to be on the right track and I am eagerly awaiting a dividend which I feel is a must do, not a nice to do.
Would anyone dispute that if CCME announced a meaningful dividend tomorrow that we would likely be in the mid to high $20's or even low $30's by the end of November? And even then the company would only be moderately valued when factoring in future growth. Big investors would be all over it and holding the stock would generate nice returns for us longs via the yield.
They've got the money to do it and still fund future projects/acquisitions, so I am hoping they don't rest...that's all.
I went to dig up the article and realized it was Ulrich with JPMorgan not GS. Sorry, going off of memory and that was from back in May. I was pretty sure that I read that GS was also calling 3800 but I can't find the article.
http://www.businessweek.com/news/2010-05-06/shanghai-composite-may-rise-to-3-800-in-next-12-months-ulrich.html
The entire CGS sector is blowing up today. Huge volume and huge price movements across the board. It definitely seems that the tide has turned and big money is coming pouring back into our sector.
Maybe GS was right about their prediction of Shanghai index climbing to 3800 in coming months
Remember the glory days of 2009 when our gems were up 5% every other day?
The entire CGS sector is blowing up today. Huge volume and huge price movements across the board. It definitely seems that the tide has turned and big money is coming pouring back into our sector.
Maybe GS was right about their prediction of Shanghai index climbing to 3800 in coming months
I don't sympathize too much with them or any company that openly complains about their valuation when they don't offer a dividend. Don't get me wrong, I'm not saying that companies that don't offer a dividend are never good investments (eh hem, CCME) but many, if not most, institutional investors look to dividend yield as a key component of their investment strategy. Too many Chinese companies don't want to pay to play and that is a big reason why the valuations are so poor. The other reason is the uncertainty of fraud, and a dividend helps address that too.
Just think about how many of us on iHub select our Chinese investments - Flood them at 3-5x earnings and ride the earnings growth, and somtimes a small increase in the earnings multiple, and celebrate a huge victory. Rarely do I see anyone that truly expects many of these Chinese small cap stocks to become fully valued above 10x earnings. Heck, we are all talking about CCME hitting the $20's like that is the Holy Grail and that would only be 9-10x 2010 earnings.
Until many of these Chinese small caps fully embrace what drives PPS in western capital markets, most will continue to peak in the 8-10x earnings range, if they ever get that high at all. Hopefully CCME will be on the front end of Chinese companies that adapt. I guess time will tell.
There isn't really a good way to tell until the ownership report comes out in a few days and then again at the next short report. I have a feeling we will see a stark increase in institutional ownership, though we won't see any accumulation that has happened after Sept 30th, which my gut tells me has been significant.
Me either :) One step at a time though. After $13 we'll be talking about the high $14's after that we'll be coaching it all the way to the $20s.
A close above the 200 day MA today would be HUGE. After taking out that milestone, it should be relatively smooth sailing to the low $13s.
Exactly! Imagine how much this fire will be fueled if/when there is an announcement about a dividend, record Q3 numbers, major contracts/acquisition, a new revenue stream such as "bus mall" magazine, upwardly revised guidance, or more analyst coverage such as MS with a price target in the high $20s or dare I say low $30s.
So much potential, so little money left for me to invest :(
This is just the beginning. Prosperity breeds more prosperity. The current performance is going to draw more investors in as they see excellent TA and a still amazing valuation. Couple that with the ongoing short squeeze of all short squeezes, and we have plenty of wind at our backs. IMO, this is the beginning, not the end, of the move we have all been waiting for.
I can't believe I'm the first to say this today. WEEEEEEEEEEEEEEE
I fully agree that this thing is still dirt cheap. As I said shortly after the company announced the buyback, I believe the ascent to the $20's has begun. I also think we'll get there a lot sooner than many might expect.
I also suspect that Jacky isn't going to rest on his laurels and hold off on a dividend. When we get our dividend, I'll immediately raise my target to the low 30's.
I think we could be there as early as late winter/early spring.
<Written by a CCME Short Seller and propaganda spreader>
Dear Diary,
Today I lost my @ss. This will be the last time that I will be writing you because I have to go sell all of my possetions, including this pen that I am writing with, and then head on down to the welfare office. I'm going to see if I can get a job plunging toilets or picking garbage up from public parks. Wish me luck, I'll need it.
Okay - this may be in poor taste, but after the last 5 months it sure feels justified :)
I may be a little pissant in their eyes, but I am now going to make it my October mission to make their lives a living hell. I am going to blow up their complaints department all day every day until they decide to escalate my concerns or block my phone number.
All I want to know is......Who's coming with me?
Can anyone tell me what the hell the SEC does all day? The NASDAQ can tell when a stock is being nakedly shorted, down to the number of shares per given day. Why then does the SEC not do anything about it? It's not like it would be hard to trace the sales to a broker and subpoena the accounts doing the trading or put a block on them altogether. WTF. What a worthless POS organization the SEC is.
Seems to be heavy resistance at $10.60. We've hit our head on it twice now. Perhaps the third try will break through? I have a feeling we will find out today.
I think we should file a class action lawsuit against bendlund for robbing us of the brain cells that were burned up while we read that monstrosity of a "financial blog." Is that the smut that they are peddling at the Fool now? Is his premise really - "I don't get it, so it has to be a scam?"
I'm going to have to pay my kid in animal crackers to start writing rebuttals to these jokers. I can't even get on their level.
On the other hand, there is a bright side to this. If this is our trading competition, at least we know we have intellectual superiority on our side.
I'm expecting to be in the 12's by the end of next week. Just my opinion and I reserve the right to be wrong :)
Just food for thought - we have traded somewhere in the area of 7 million shares in the last 10 trading days. If you figure that most of this is traders flipping shares and assume that only 30% of the buying constitutes shares falling into firm hands, then we still would have had 21% of the float locked up in 10 days. The fact that the price is moving up amidst all of this buying is the giveaway that this is not all trading and that there is a lot of accumulation going on.
I believe it is safe to say that after this recent flurry of buying, coupled with the company buying back a lot of shares, we are going to see much more stable pullbacks going forward.
I also believe that future price movement is going to have a strong, and perhaps violent, upward bias as a result of "cheap & flimsy" shares being absorbed out of the general supply recently.
This is an extraordinarily excellent time to own CCME IMO.
Agreed. After a 20% run up in just a few days, some retracement is not only likely, but is a healthy part of a sustainable move. This is not in any way concerning to me.
WEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE!
I haven't said that in a really, really long time. Man - that felt good!
Holy volume Batman! We're poised to blow the lid off of 1 Million shares today.
Or they could be betting that it is simply going to follow the same pattern as the last 6 months, which has been to give up huge gains without any negative news. I don't think that high Put volume necessarily indicates that anyone is betting on an "attack" anymore. I think it is more likely that they are just betting on what they think is the more likely direction of short term price of the stock based upon current levels.
FWIW, I think this run still has a lot of legs under it.
I'm not sure if everyone has read this yet, but there was a great article published this morning at Seeking Alpha that explains the structures of many Chinese companies, including VIEs, and specifically mentions CCME. I think that if the shorts were going to try to burn this one down, it would either be based upon the VIE structure of the company or any discrepancy between SAIC filings vs SEC filings.
Having said that, I simply don't believe the shorts have anything substantive left to drag up that we haven't already covered.
http://seekingalpha.com/article/227536-review-of-u-s-listed-chinese-company-ownership-structures?source=yahoo
Agreed. There are definitely a lot of traders that were riding the rotten TA down and are now riding the excellent TA up. However, I also believe there is some strong institutional accumulation coupled with the company buying back shares that is just adding more fuel to this explosion. I am expecting to see at least one institution with 1,000,000 + shares on the next ownership report.
Some big players are definitely loading up, I wouldn't be surprised if we get coverage from a household name (MS, GS etc)
There is going to be some strong psychological selling pressure at $10, but after a few bumps we should bust through and then is should be clear sailing to the low $11's.
Feel that SQUEEEEEEZE! This is so much fun, and IMO we are going to be cheering this run all the way to the $20's.
It appears that our trader is only a small part of this tidal wave of activity. There is some big money in this game.