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Viking is a valuable member of the this board. He makes lots of valuable contributions.
His dumping explanation is every bit as plausible as your shorting theory, Mr. Congeniality.
How do you know there are 10M shares short? I sure hope that there are, as they have to be bought back some time.
We will not have to wait months for PR, imo, because the week long investor tour is the first week in September, at most one month after the Q2 release and cc. Have to believe Solomon will have lot of positives to say. Think he'd want to corral himself with his biggest shareholders and representatives from the Sweden uplisting sponsors for a whole week without positive stories?
At the very least, there will be lots of reports on this board that week. But, I'd expect substantive announcements to the public, as well.
If they don't specifically reiterate guidance in the release, pretty sure someone will ask. But I bet they do. Personally, I'd find it encouraging even if they dropped guidance to $130M - $145M, if they expressed confidence and explained why. The low end would still be 150% growth.
In the future, for a company with so many moving parts, giving a conservative range is probably the best policy.
Thanks for sharing.
I get to similar numbers, though not too sure about your 2012 services estimate.
HB,
Cash balance EOY 2012 will be negligible, as SIAF will be cash flow positive starting sometime in 2013. They are not eligible to borrow enough to mimic HOGS, not that they'd want to emulate their debt ratios. But, they are beginning debt financing.
They are building a $300M - $500M book value company in the next 2 or 3 years, probably $250M EOY 2012, so that their 33% +/- margins earn $100M - $167M year, or 3x - 5x their current market cap.
EOY 2013 cash balance is an interesting question, because we don't know when they in the year they will build this earning machine solely with funds from internal operations.
But cash balances will be huge in 2014, super fortified by spin outs.
Viking,
Changing the subject, and because you seem up on this stuff, what do you think each fish farm will sell in 2013, and how much will contracting/servicing/consulting revenues be, also 2013. My educated guesses come up with pretty big numbers.
Guess to get there, may start with 2012. So might estimate those too, if you care to oblige.
That's hardly a drawback.
For one thing, the shares would have to be 5x to 10x current to be margin-able. For another, you just switch it back.
What was that all about?
Be nice for SIAF to get on the Maxim Group's radar screen. Any analyst coverage would be great, whenever they grow into it.
HOGS has a market cap of $380M, Book Value of about $500M, and a forward p/e of 5.8. These are not so far ahead of SIAF considering
with a forward p/e of 5.8, SIAF market cap would be higher, and EOY NTA will be about $250M.
However, HOGS is a much more mature and larger company with $1.5B in revenues. OTOH, SIAF has much better margins and growth.
Completely agree.
I hope your thoughts put an end to these unlikely, unverifiable share count/price speculations.
Of course, once the company reports, and recommences issuing releases, we'll have a lot more to occupy our SIAF head space ... :)
I should not have posted that I heard a rumor.
I've asked the source to try to verify, if possible.
Okay, what conspiracy theory has been proven correct?
In this case, you are supposing that a loosely connected group of individuals are somehow purposely driving their aggregate investment of say $50M investment (guessing 40M shares at $1.25 average) down to $16M in order to increase their share to 45M shares.
Keep in mind these are maybe 30 individuals maybe 100, maybe 300, all with different investment goals and thresholds.
And why are they doing this?
To get the share price up later. How do they do that? By buying at higher and higher prices.
Looking forward to the Q2 release, in part so the posts aren't dominated by pretty useless -- certainly unverifiable -- speculation about how who owns what number of shares determines price.
The thing about conspiracy theories is that they are not correct.
Not to worry, Traderfan said he will be buying at $.44 I believe. Maybe after a close of $.44+.
Doesn't seem that hard to get the plan to be believed, at least to some extent, to some level of probability, given the 20 to 1 upside that is quite reasonably based.
And the plan -- both operational/financial and new exchange listings -- should be trumpeted wherever and whenever possible, and most certainly when major milestones are met.
As time goes by, the audiences ought to increase.
Just today, I heard a rumor of a prominently known buyer; which if true, would be a major boon to credibility.
I will not spread unsubstantiated rumors, other than to say at least one exists; I'll regard it as unlikely unless made public if a 5%+ stake is acquired.
So my question is:
if it is widely accepted that SIAF will get a fair valuation in Sweden -- say a p/e of 8 on then current year earnings of $1.00 (never mind, three year 100%+ growth record) -- the shares will be a 20x current in just one year, according to plan.
Even if this plan is delayed, earnings fall somewhat short, and there's only a 40% chance of it even happening, isn't the 20x upside worth it?
Shouldn't this possibility invoke buying, as it seems to only for the JF members?
I have to believe that as evidence (earnings) and credibility (history) mount, as milestones are met and publicized, and as time nears, the shares have to rise.
Even if you believe the company is a fraud, you risk 20 to 1 shorting it.
All logic tells us that eps matter; all recent SIAF history tells us it doesn't.
But over time, not only will earnings rise dramatically, but also:
1) The growth story becomes more credible, because it's already been demonstrated,
2) Likewise, the scaleability of the businesses has been demonstrated so that future eps growth is baked in, and easy to publicize and understand
3) Uplisting grows nearer; likewise, roadshows to institutions
4) Dual listing and spinning out subs grow nearer
5) Net assets rise consistently and dramatically
6) Cash flow positive operations approach and happen
7) "Cash rich" levels can be seen on the horizon
So, I suppose the market can continue to ignore income, but all the above?
SIAF will pay a $.05+ dividend in October, 2013, derived from 8% of 2012 income.
If the catalyst is this dividend payment, imo, it will be because it coincides with:
* the end of share issuance
* the company being cash flow positive
* NTA of approximately $3.00 per share
* current 2013 earnings > $1.00 / share
* 2013 dividend of $.08+
* 2014 guidance/expectation of:
* > $1.50 / share
* ending 2014 cash balance > $50M from operations, plus:
* ~$35M from first spinout, expected that year
* additional ~$35M distributed to shareholders (~ $.40)
by May 2013 we will know if the 145m rev and 0.60 eps target for 2012 has been met
Pretty sure we'll never know, but I'm rooting for your theory.
Then your delusion must also include some way to get the share price above minimum uplisting criteria.
So what you really are saying is that loosely connected individuals will take losses because some of them will acquire more shares, and then this "entity" will turn around and drive the price up 5x just to get to the event.
How they are acquiring more shares in aggregate while driving the price lower is still counter intuitive, to say the least. You'd have to have an organized effort for some to take losses by consistently selling on the bid.
Wouldn't it just be easier to keep 50% of the company at $.75 and raise your share to 55% in the hopes that your buying helps double the share price. (rather than getting to 60% assuming the incremental 5% can quintuple the price)?
No. I don't have a credible reason, other than more sellers than buyers on most days. I'd say that the tail was wagging the dog, except that some of those days have huge volume.
So my only explanation is share churn through JF members who individually buy and sell, with selling pressure from issued shares.
Just because no one has a credible answer from a supply and demand perspective, doesn't mean we should develop conspiracy theories which only obscure the situation further.
Fact is, I've always been in this company based on a belief that the growth will be there, and that the fundamentals will be recognized in the end, gaining traction and credibility quarter by quarter, not day by day.
Must admit that I'm amazed how little regard for the growth and belief in the company there has been -- and no doubt its need for cash is a factor -- but I still expect these arguments to become increasingly un-ignorable, restarting with this quarter's results, but fully buttressed by Q3, when revenues may approach $50M, well over the entire market cap.
At some point, a rational marketplace will realize that spending $100M a year results in a several hundred million dollar set of assets that spin out cash like yarn.
Agree that we'll see a flow of good results and news starting with the upcoming release, in one and a half to three weeks.
Can someone explain to me how it is mathematically possible for JF in aggregate to make money or benefit in total by trading the shares to a multi-year low?
I suppose if you could drive the share lower on 100,000 shares and somehow pick up a million without raising above where you sold, but that ain't happening.
Come on, isn't this conspiracy theory taken beyond sense?
After a hundred+ posts on who owns the shares, is there one credible conclusion relating to share price? If anything, we should be at all time highs, as more and more shares find strong hands.
Q2 results, presumably with detailed operational updates like the last Q release, followed by the conference call.
btw, I withdraw my earlier question about volume drying up suddenly.
And the company should support the activity you are suggesting.
We have every reason to believe that operations are fine, the first major confirmation coming in as little as two weeks. My belief is that we will then see more news coming into and through the investor tour. The pictures already show the physical evidence of a rapidly growing company.
In general, we know the road map operationally, financially, and for the dividend policy, the uplisting/dual listing strategy, and for spin outs.
If that isn't a recipe for a p/e of 8+, I don't know what is. And that's a 20 bagger from here in a year, maybe year and a half.
I would just like to see much more consistent publicizing of milestones being met for anything approaching the goals already articulated. And I think we will.
This quarter will book record revenues and earnings, followed by Q3 50% higher than those, with the net tangible assets of the company rising in the two quarters by more than the current market cap. Q3 revenues alone will exceed current market cap by 30%. Anybody know another company that can make those claims?
If the share price rises even by the actual increase in NTA or even by incremental earnings, the minimum uplisting price will be met; albeit, possibly not quite as fast as we'd like.
By August 31, 2013, 13 months from now, the company will have approximately doubled its stockholders' equity from the $148M last reported. That's about $2/share to $3.50/share, equity issuance taken into consideration. And they will have earned about an additional $1.25 per share. And they will be cash flow positive, retaining dramatically increasing earnings each quarter.
If nearly on time track, they will then be traded in Sweden, with active execution of plans to spin out subs.
Any speculation why the volume has suddenly dried up, and no price movement?
I think a lot will happen the upcoming 6-months. Not like the silence the last 3 we had.
A,
Good question.
You might try asking that one privately (and then post answer).
Counting today, the average volume over the last 6 trading days will exceed 1,000,000 shares per day.
In my opinion there is no dilution issue; that's the wrong word. Even if capital from the marginal share issuance does not return enough earnings to equal the rise in share count (which is debatable), the capital development budget is somewhat fixed, and strategically entrenched and justified.
The overhang the issuance creates is the problem.
I know nothing about rebate trading, but 6M shares is a lot of shares.
As long as the share issuance is limited to a reasonable number that is either kept or bought by people who like shares with a p/e < 1, than the cash flow positive milestone will be reached while the share price is much higher.
Trick is for Solomon to time and limit new issuance to say 10M shares and report fundamentals that make those shares attractive.
The later will start anew and with records in every metric in 2 to 4 weeks, to be followed in three months with new quarterly records in revenues, earnings, and increase in NTA of 50%+.
After today's 20% rise, we have a company whose market cap is:
* less than its average quarterly revenue the rest of the year
* less than half its growth in NTA over the remainder of the year
* less than 1/5th of its current stockholders' equity
* a current year p/e of approximately .5
Not exactly overpriced ... nor dual listed would it be at 15x from here :)
Agreed that there's no reason to suspect operational problems; as you say, they are obligated to report material bad news.
But they stated in the Q1 pr May 18th -- among a plethora of positive developments -- that they expected to sign a contract for a new cattle farm IN MAY.
You just shouldn't make this public statement if you are not 100% sure. And if you are sure and it happens, even if you have to wait for government approvals or whatever delays like the baby prawn farm, you issue a press release that work has commenced.
There's a lot going on at this company. PRs would not be fluff.
For some reason, they've made a conscious decision to wait until the Q2 release, followed by the investor tour.
In the meantime, we see what's happening, trading wise.
I will be curious what they say about the uplisting strategy and timing.
Wonder if Solomon has Australian residency?
Course this has nothing to do with immediate stock or company issues; nor would have any operational/competitive impact for a couple years, if ever.
Interesting though.
The summer comment is fine from a poster, but not a representative of the company. My guess is that Chad would want that one back. Especially since he made it when the shares seemed low, yet the summer just started, maybe not even officially started.
I also agree that that a pr update without hard news is better than none. They could simply update the statuses of all the initiatives that they went out of their way to articulate in the Q1 release, including the expectation that a cattle farm contract would be signed within a few days.
I'm going to assume (hope) that they hold back on these until all approvals, t's crossed, etc., like they did with the baby prawn farm. Rather, they've decided to issue the update in the Q2 report; that to be followed with announcements approaching or during the investor tour.
If waiting is a conscious plan, it's a bad one, imo. But surely better than no new initiatives. The thing is, the company has so much going on, it's hard to believe there aren't material operational milestones being met. There are ways to write releases that don't overstep bounds, to inform shareholders.
So, we're forced to wait .. no doubt, some to sell.
I guess that's why I'm up several hundred percent here while Jordan is down 50% or whatever.
and then issuing the last of the equity financing at omx so new shareholders got somethin to buy :)
It appears to me that the company is taking a bit of a new approach, consciously or not, because the share price has reacted poorly right after earnings releases in the past.
Not too sure that this is the right approach, and judging by the share price now, it isn't.
But it is interesting that JF reports the company is trying to get its report out early. This would make a lot of sense, especially if it is good. As long as there are no new share issuance surprises, from these levels, hard to imagine anything but a good reaction in share price.
If they can report two weeks early, this will give them a full month for additional or supporting press releases before the investor tour, a week long event which I cannot imagine Solomon would subject himself to without overwhelming positives.
There may be transformative news pending about either a restaurant chain deal or the distribution/retail chain or even new, additional or multiple farm contracts. Later deal timing -- but hopefully before or during the investor tour -- is more likely.
In fact, perhaps the company hopes to make those announcements to the tour, while touring each facility; for instance, announce the restaurant deal at the restaurant (if it's signed then).
How do you know what the short share count is? Where reported, it has never been any where near those levels.
Better explanation, imo, is the debt repaid with equity is and has been sold.
Question is how long it can overwhelm buyers, and at what price levels.
I would think the the ongoing high volume does eat up those shares; meanwhile, makes the price terribly attractive to longs or potential longs.
I do agree with you that the company should be issuing press releases.
But I think their strategy is to prove progress with the Q2 release, both results and verbiage (that may not have the SEC restrictions of contract announcements), and then continue with announcements during the investor tour.
t would not surprise me if they are attempting to get results out early, as they would want more time between the results and the tour; only 10 days if they file the usual 5 days late.
It would also not surprise me that efforts notwithstanding, they are not early.
The last time the shares were at this price -- the same intraday low of $.36, also on huge volume -- in December, 2011, the price rebounded to close at $.62 in 6 trading days.
And that was before 2012 guidance, the new cattle and fish farm contracts, 2 $20M revenues quarters, etc.
So, we'll see ...
The shares have been $1.00 recently, where it had climbed from exactly these levels.
Question for right now is whether this is a double bottom, or not.
Dutch thinks not; hence, the cryptic comments.
I'm not much on technicals, but I certainly agree that a climb to $1.50to meet the (reduced) minimum uplisting criteria is easier from $.75 than $.35.
So I would argue that there should be press releases and a better explanation of future share issuance, among other things.
But also seems clear to me that we'll have to see if the shares hold here in anticipation of Q2 and the investor tour, or not. I would think that with the volume of the last quarter, issued shared would be sold back already. or soon.
The company's fundamental path is on course, as far as I can see; 2012 p/e of .6 notwithstanding.
Obviously, the continual sp erosion is frustrating, or worse.
For those of us that have been around pre dairy sale, curious, do you think that Solomon has come through?
If not, there's not much reason to own the shares, imo. If so, we still have to put up with the share issuance. But were this not a small cap Chinese company, this % dilution (arguably earnings accretive) measured against sustainable 100% growth would definitely not have this effect on the share price.
imo, Solomon has done just about everything he said he would; albeit, sometimes belatedly, like Form-10 approval. But that was pretty much out of his control, as I think the dividend policy decision is.
The one exception -- a big one -- was the statement about share issuance at >$1.50. I think he either had something up his sleeve that didn't work, or it was misstated because of optimism.
There's no way the dividend won't be seen as positive the moment the company is cash flow positive and share issuance is ended, one year from now.
Even 2013 share issuance would be taken in stride if it can be done at reasonable prices; something like $10m for > 10m shares, then done.
My great hope is that positive Q2 forecasts and free speech at the tour convince those in attendance (JF, plus) that it is in their own interest to buy now, before the herd, such that share dilution will be minimized, and uplisting chances and timing optimized.
Therefore, not only will expansion take place as rapidly as possible, but also debt obligations will be met as inexpensively as possible.