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I agree completely with the observation that traditional valuation metrics are appropriate here. It is precisely because this is not a typical pinksheet stock that many have invested in the company.
I understand that the purpose of the PR was to confirm completion of the audited financials, but I wish the PR had given a glimpse of the impact that the USIS relationship is expected to have on revenues and (hopefully) earnings. Personally, I have never doubted the essential accuracy of the information supplied by the company. But IMO the company will need to show considerable growth from here to command anything like a $.25/share price.
For the 9 months ending September 30, 2007, the company had net operating income of $338,125 with outstanding shares of 140,000,000, or $.0024 for 9 mos. -- for all practical purposes, a break even business. The 9 mos. number implies $.0032 for the full year. Giving it a 20 PE -- generous for a pinksheet stock -- it is still a $.06-$.07 stock.
I am very long this stock, and am optimistic about the future, but there is no reason to exaggerate the company's accomplishments to date. If the company's performance had been all that impressive, the share price would not be where it is. The company has to earn $.01 or so for the stock to get to $.20-$.25. I will be very happy if it can earn that kind of money in 2009. But it is hardly a fait accompli.
I think that the USIS relationship will grow the top line. I hope the company has not had to give too much to USIS to get the business.
Thanks for this information. I am sure that the alliance is a good thing. I just don't know how good.
It would be nice to know that the company is actually making profits. It has been essentially a break even company for the entire time that I have owned the stock.
VBDG to make Red Chip presentation tomorrow:
"ORLANDO, Fla., July 15, 2008 (PRIME NEWSWIRE) -- RedChip Companies, Inc. today announced that the executives of emerging small-cap companies will present an inside look into their industries and businesses during a virtual investor conference to be webcast July 16, 2008, starting at 8:55 a.m., Eastern Daylight Time.
To view the presentations at their scheduled times, visit: http://www.redchip.com/visibility/conferencePages/NewYork2008/conferenceMain.asp?page=virtual
RedChip's virtual investor forums are offered throughout the year and feature emerging growth companies from a wide range of industries including Business Software Services, Emerging Markets, Energy, Telecommunications, Consumer Goods, Technology, Healthcare, and more.
The July 16th webcasts will feature presentations by executives of the following companies: Datameg Corp. (OTCBB:DTMG); EnterConnect Inc. (OTCBB:ECNI); Vertical Branding, Inc. (OTCBB:VBDG); VidShadow, Inc. (Pink Sheets:VSHD); UpSNAP, Inc. (OTCBB:UPSN); Worldwide Energy and Manufacturing USA, Inc. (OTCBB:WEMU); Power of the Dream Ventures, Inc. (OTCBB:PWRV); ZBB Energy Corp. (AMEX:ZBB); and RXi Pharmaceuticals Corp. (Nasdaq:RXII).
In addition to participating in virtual conferences, many of these companies are featured on RedChip's Real Radio Show, which airs every trading day from 9 a.m. to 10 a.m., EDT, on 700 AM Washington Business Radio. To listen live or to hear prerecorded shows, visit: http://www.redchip.com/visibility/Radio/radioMain.asp.
I don't read the PR quite that way. It speaks of developing a joint client base -- doesn't say anything about existing clients. Also, as far as I can determine, GMT does not have a website, and so I assume it is a small company. It does appear to me, however, that GMT may have contacts, and that a combination with LBWR may benefit both companies.
I hope that in the not too distant future the company may be in a position to provide guidance on the revenue and earnings front. The announcements of business alliances are positive, but it is impossible to quantify the impact. I suspect the company is itself waiting to see how things shake out before making public projections.
More good news on the business development front:
http://biz.yahoo.com/iw/080715/0415730.html
With all due respect to those fixated on the uplisting, I continue to believe that in the end appreciation in the stock price is almost entirely dependent on increased revenues and meaningful earnings.
Steve
EGMI.ob:
Informative post from the EGMI board:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=30546604
Steve
VSYS.ob:
Announces successful completion of pilot project, and potential installation at 400 locations:
http://biz.yahoo.com/iw/080708/0413691.html
Steve
I agree that it is lacking in details, but if it is material enough to warrant a PR, I continue to think that this USIS relationship will prove to be extremely valuable for the company.
More news re USIS contract:
http://biz.yahoo.com/iw/080630/0411846.html
Steve
Per 5/7 PR, move to OTCBB should occur this week if on schedule. Does anyone know if the timetable has changed? Thanks.
CNOA.ob:
CNOA is getting into the wine business:
http://biz.yahoo.com/bw/080616/20080616006072.html?.v=1
Steve
Or, failing that, a PR.
Oil: $150/barrel
Gold: $1,000/oz
Dow: 11,000
Creede:
Pure speculation on my part, but I would guess that Dexter has given some thought to an exit strategy 3-5 years out. It is my understanding that he has a ton of shares, and it will be difficult for him to sell into the open market. If our platform and know-how are valuable, it would make sense for both companies to "get to know each other."
While I don't know the business terms of the arrangement, I tend to think that this is the kind of event that might move revenues to a place where real earnings might be possible. The PR suggests this is likely. And if, as you suggest, USIS loses money on this business, it makes great sense for them to outsource it and get referral fees.
Of all the news that has come out recently, this seems potentially the most significant IMO.
Steve
Creede:
That would make sense. The news this week strikes me as extremely significant. USIS is a substantial company.
If one were to speculate, one might ask if USIS and/or Labwire see(s) this as a first step toward an eventual acquisition/merger. Just a weekend speculation . . .
Steve
Sold the remaining shares this morning for $1.41. Concerned that there will be significant profit taking today.
Should be a good day today.
Labwire Signs Alliance Agreement With USIS
Thursday May 15, 9:00 am ET
HOUSTON, TX--(MARKET WIRE)--May 15, 2008 -- Labwire, Inc. (Other OTC:LBWR.PK - News), a leading provider of employee screening solutions, security, and compliance surveillance services, is pleased to report that on April 30, 2008 Labwire signed an Alliance Agreement with USIS, a large national commercial services group. Under the terms of the Alliance Agreement, Labwire will perform drug/alcohol testing services and pre-employment background screening products and services for certain USIS clients: in turn, USIS will offer their products for sale by Labwire to its clients. The agreement is for an initial term of two (2) years and provides for both firms to pay referral fees based on a percent of business delivered. The initial clients referred by USIS will begin transitioning to Labwire on June 2, 2008 and will continue through year's end and will include several large operating units in commercial transportation industries.
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"Mr. Morris and the sales team are to be congratulated for securing this substantial relationship agreement," stated Marlin Williford, CFO. "As this agreement is implemented, it should provide good revenue growth for the 3rd and 4th quarters of this year."
Dexter Morris, Labwire Chairman and CEO, offers the following business insight: "We are excited about our technology gaining the acceptance of a company such as USIS. We see this as a first step in expanding our client base through alliances as well as direct sales and acquisition opportunities. Labwire will continue to seek this type of alliance agreement with other major companies offering various services. We believe that these alliance arrangements will allow Labwire to grow more rapidly utilizing the strength and effectiveness of its operating platform to grow its revenue at a faster rate than conventional sales would allow."
Steve
Then why are you here?
nsomniyak:
I sold what amounts to about 70% of shares at an average price of $1.25. Have decided to leave the rest in the game for a little while. But I agree completely that it feels like found money.
Steve
Way under water . . .
Many on this board disagree, but I don't think we will see any meaningful increase in share price until improved earnings are announced. IMO this stock is not a typical pinksheet stock and does not trade like one -- the reason why most of us are in the stock, but the reason why it will require patience. Those in it for a quick flip have been and probably will be disappointed.
My guess is that in 2008 revenues will be at least $5.5 million, and that sometime during the year we will see $.20-$.25 per share. I agree with others here that long term the prospects for the stock are good. I am impressed with management and believe that the company will have steady, if unspectacular, growth. I really like the transparency the stock has always had, and consider the recent rantings of a negative poster about misleading the shareholders to be downright silly.
I also think it is silly to criticize anyone for buying this stock as cheaply as possible, whenever the opportunity presents itself.
Very positive PR:
http://biz.yahoo.com/iw/080507/0394428.html
Steve
abh3vt re CNOA.ob:
Makes you wonder if today's announcement has been orchestrated to enable a sale of the remaining shares at a similar price . . .
China Organic Agriculture's CEO Announces Intention to Purchase Company Stock
Monday May 5, 8:33 am ET
LOS ANGELES & JILIN, China--(BUSINESS WIRE)--China Organic Agriculture, Inc. (OTCBB: CNOA - News) (the “Company”), a growth-driven agricultural products company leading China's organic foods revolution, announced today that Mr. Changqing Xu, CEO of the Company, plans to purchase no less than $2 million dollars of Company stock or no less than 1% of the total outstanding shares within a year depending on the market value of the shares.
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Mr. Changqing Xu, CEO of China Organic Agriculture stated, “Since the current stock price does not reflect the Company’s full and fair value, and is in my view substantially undervalued, I have chosen to purchase shares to represent my and CNOA management’s confidence in the Company’s long-term growth.”
Mr. Xu continued, “By continuing to sign cooperative partnership agreements with local green and organic rice grain depots, as well as retail distributors, China Organic Agriculture can increase the capacity of its rice production, while at the same time ensuring that annual operating profit and growth targets can be realized. We are also excited about the opportunity to diversify the range of agriculture products we currently offer. Our goal is to continue to be one of the leaders in the green and organic rice industry in China, while expanding the variety of agricultural products we supply to our loyal Chinese customers, all while delivering significant value to our shareholders.”
About China Organic Agriculture
China Organic Agriculture is among the largest producers of green and organic rice in China. CNOA controls all aspects of the process from developing seeds to planting, processing, R&D and distribution. The Company has an extensive distribution network, located in the major cities in China.
CNOA has experienced significant growth since its inception in 2002. CNOA has put solid plans in place to markedly expand sales.
The quality of CNOA’s products results in the ability to obtain prices approximately 15% higher than comparable products. CNOA has in excess of 6,260 acres dedicated to the production of green and organic rice. The irrigation system is fed from the Nen River, one of the last unpolluted rivers in China. The Company’s flagship brand, ErMaPao, has won several quality awards, holds the highest organic certification and is one of the most popular brands in the country."
Right on. I couldn't agree more.
Creede:
I think that our "price per share problem" will go away at the first sign of meaningful earnings, and not much before. I am very long this stock, and would love to be wrong, but $.15 per share seems about right for a company that is essentially breaking even. I fully expect improvement in 2008 and beyond, and am holding for the long term. But I don't see any reason based upon current numbers for this thing to explode to the upside.
Steve
PR summarizing and assessing 2007 performance:
http://biz.yahoo.com/iw/080414/0386045.html
researcher59 re CNOA.ob:
I was unaware of the Squawk Box article. It was undoubtedly the primary catalyst.
A lot of attention for a small company.
Steve
abh3vt re CNOA.ob:
The article is dated March 28, and earnings -- announced March 31 -- were actually better than the $.20 mentioned in the article. But I think the article may have contributed to the huge volume today, as it was just posted on the Yahoo board.
As littlefish points out, it is surprising that Jim Rogers is bothering with stock in any company this small. Until recently, 100,000 shares traded was a big day.
Steve
researcher59 re CNOA.ob:
Today's action may reflect recommendation by Jim Rogers:
http://moneynews.newsmax.com/money/archives/articles/2008/3/27/161832.cfm
Steve
I agree. It is silly to suggest that someone should pay more for a stock than necessary.
IMO, the stock will not be available at this price if/when the company has earnings. I think the volume is pathetic because everyone who wants to be in the stock already is, and because those who are in the stock believe in the company's future and don't want to sell. I don't think a lot of potential buyers are waiting on the sidelines hoping to get in "cheap." I don't think many people know the company exists. I mean, we are talking $5 million or so a year in revenues.
Good luck getting a few more shares at this price. I would join you, but I already own too much. It would be comforting if all those great new contracts discussed on this board could be the subject of a PR. Makes you wonder . . .
I don't know how today's action can be seen as a good thing.
I am very long, but will be pleasantly surprised if this is anything like a 10-bagger from these levels any time soon. Frankly, I would be happy to see the company show a solid profit for a quarter and then a year. Right now it is a break-even operation, and priced accordingly.
Lot of shares sold today from $.12 - $.14. Not encouraging.
ENTX.pk:
10KSB filed. EPS $.08 for 2007. Increasing revenues and margins. Not bad for a $.28 stock. Thanks to KIK for pounding:
http://biz.yahoo.com/e/080314/entx.pk10ksb.html
Steve
rrufff re VSYS.ob:
Are you still holding this stock? Good news lately, although sometimes this company issues positive PRs in advance of disappointing numbers. LOL.
Steve
LTTC.ob:
Federal Government has exercised $2.35 million option:
http://biz.yahoo.com/bw/080226/20080226005485.html?.v=1
Steve
CNOA.ob:
Withdraws 8/07 Registration Statement, per filing today. I can't seem to link it, but if you look under filings here on IHUB, you can see filing.
Steve
Bobwins re APWR:
Presented at Roth Conference 8:00 a.m., PST. Up 10%+ on substantial volume.
Steve
EGMI.ob
News re successful test results:
http://biz.yahoo.com/prnews/080219/cltu089.html?.v=87
Steve
KIK re CNOA.ob:
Don't really know. Only difference in the numbers I can see is that this new filing has EPS numbers for Q3 and 9 months. But if you take net income numbers in November form 10 and divide by OS there stated, I think you get to the same place.
This most recent form 10 prints out to about 123 pages, and has exhibits and other information not in the 10Q from November. Perhaps the company felt the need to make additional disclosures apart from numbers. Frankly, I have not yet (may not ever) read the entire filing.
Steve