Linus, perhaps Kellogg Group sold because the company is no longer looking to list on the AMEX? Kellogg is one of the largest specialists for companies listed (or looking to list) on the AMEX.

IEAM appeared to indicate in the past call that it had pulled its AMEX application in favor of getting on the Nasdaq.

Hweb, I think you're right to be wary of the ability to sustain the strength in AYSI's operations. Found this in the 10K:

"Alloy Steel had sales of $3,386,083 for the year ended September 30, 2006,
compared to sales of $3,620,457 for the year ended September 30, 2005. These
sales consist solely of the sale of our Arcoplate product. Substantially all of
our sales during the periods were denominated in US dollars. Sales denominated
in Australian dollars were converted into U.S. dollars at the conversion rate of
$0.74705 and $0.76618, representing the average foreign exchange rate for the
years ended September 30, 2006 and 2005 respectively. The decrease was due
primarily to the timing of orders being received in September and this position
will reflect in the December quarter.

------------

There were some sales that got pushed out into the current quarter that made things look better than they probably are. In the past few years, the company has not even made any money on a pretax basis. The net income from the past two years has been boosted by income tax benefits of 135k and 314k, respectively.

Some interesting comps for UTVG (a Chinese travel company). These two stocks are on-line travel companies with operations based in China:

CTRP

Latest earnings: http://biz.yahoo.com/prnews/070211/hksu001.html?.v=2

Appeared to match estimates of 0.26 for the quarter. Analyst estimates for upcoming FY 07: 1.27

http://finance.yahoo.com/q/ae?s=CTRP

Current price: 61 - 62; trades at 48x forward estimates.

------------------------

LONG

Latest earnings:
http://www.elong.net/AboutUs/update/topic_20061110_01.html

Company earned about 0.01 in the last quarter; FY07 estimate: 0.28

http://finance.yahoo.com/q/ae?s=LONG

Current price: 12.25; trades at 44x forward estimates.

-------------------------

UTVG.ob

Last earnings report:
http://biz.yahoo.com/iw/061108/0182074.html

Company earned around 0.03 fd in the quarter; has earned about 0.06 ytd. On track to hit its guidance of 0.10 for FY06:

Fiscal Year End: December31
2006 Projected Revenue: $6.3 million
2006 Projected Net Income: $3.1million
2006 Projected Earning Per Share: $0.10

Current price: 0.90; trades at 9x forward FY06 estimate...FY07??

If they can show growth of around 30% next year, the company could be on track to earning 0.13. If UTVG got just 1/4 of their competitors' forward multiples, the stock could be worth closer to 1.50.

CPHI is now trading at 1.70, which is the same price that its recently announced PIPE shares were sold at.

Anyone buying at this level has the chance to get in at the same price as those investors did without the selling restrictions.

CPHI is expected to earn 0.23 this year (mgmt guidance of net income of 8MM/34.8MM fds). Management has also guided for 30% growth in income for next year:

China Pharma Holdings, Inc. Provides Preliminary 2007 Outlook
Wednesday September 20, 11:51 am ET

<snip>
The Company previously announced that it expects to achieve revenues of $20 million and net income of $8 million for the year ending December 31, 2006.
The Company expects net income to increase by at least 30% for 2007 from 2006 levels.
This guidance is based on recent new drug introductions and strong pipeline development.
"China Pharma's strategy of growth through aggressive new product launches and strong research and development provides us confidence that we will sustain improved net income for 2007.
Recent product launches include Propylgallate and Ozagrel, which treat cardiovascular & cerebrovascular conditions, the first and third leading causes of death in China, respectively," commented Li Zhi Lin, President and CEO.

<snip>

The new PIPE shares represent about 7% immediate dilution (2.5MM shares/34.75MM shares) with warrants that are now anti-dilutive at 2.38. The shares have fallen roughly 23% from the 2.20 level when the deal was first announced.

Estimates:
----------------
FY06: 0.22 - 0.23
FY07: 0.27 - 0.29

Stock is now trading at 6x FY07 estimates, with a very decent growth profile.

CSCT announces financing with Citadel (one of the larger hedge funds, and one that is also involved with HRBN)...

China Security & Surveillance, Inc. Completes $60 Million Bridge Financing with Citadel Equity Fund Ltd.
Friday February 9, 9:40 am ET


SHENZHEN, China, Feb. 9 /PRNewswire-FirstCall/ -- China Security & Surveillance Technology, Inc. ("China Security") (OTC Bulletin Board: CSCT - News), a leading provider of digital surveillance technology in China, today announced that it completed a bridge financing with Citadel Equity Fund Ltd. ("Citadel"), which is expected to transition into a longer term financing with Citadel in the near term. On February 8, 2007, China Security issued to Citadel $60 million aggregate principal amount of Senior Notes which matures on February 16, 2007 or such later date (no later than 120 days from February 16, 2007) to be mutually agreed by and between China Security and Citadel.
ADVERTISEMENT





About China Security & Surveillance Technology, Inc.

Based in Shenzhen, China, China Security through its subsidiaries manufactures, distributes, installs and maintains security and surveillance systems throughout the PRC. China Security has a manufacturing facility located in Shenzhen and a R&D facility which leverages an exclusive collaboration agreement with Beijing University. In addition, China Security has built a diversified customer base through its extensive sales and service network that includes 37 points of presence throughout the PRC. To learn more about China Security, visit their website at: http://www.csstf.com.

About Citadel:

Citadel Equity Fund Ltd. is one of the entities for which Citadel Limited Partnership serves as portfolio manager and Citadel Investment Group, L.L.C. provides administrative and investment-related services. Citadel Investment Group, L.L.C. was founded in 1990. Affiliates of Citadel Investment Group, L.L.C., including Citadel Equity Fund Ltd., deploy investment capital across a highly diversified set of proprietary investment strategies in nearly all major asset classes in all the world's principal markets. Citadel Investment Group, L.L.C. and its affiliates maintain offices in Hong Kong, Chicago, New York, San Francisco, Tokyo and London.

Safe Harbor Statement:

This press release contains forward-looking statements concerning China Security and its business and products, which are intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. These statements can be identified by the use of forward-looking terminology such as "believe," "expect," "may," "will," "should," "project," "plan," "seek," "intend," or "anticipate" or the negative thereof or comparable terminology, and include discussions of strategy, and statements about industry trends and China Security's future performance, operations and products. The actual results may differ materially depending on a number of risk factors including, but not limited to, the following: general economic and business conditions, development, shipment, market acceptance, additional competition from existing and new competitors, changes in technology, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risks factors detailed in China Security's reports filed with the Securities and Exchange Commission. China Security undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.




--------------------------------------------------------------------------------
Source: China Security & Surveillance, Inc.

Valuemind (and MSGI), thanks for that clarification on UTVG's PR.

I think this might explain some of the pressure on metals:

Red Kite Management, a $1bn metals-trading hedge fund, has suffered losses of up to 15 per cent so far this year - and is now trying to stall investors who might want their cash back, MarketWatch reports, citing documents it has obtained, as well as people familiar with the firm’s performance.

The news sparked heavy falls on the metals markets, with one stressed trader declaring to Reuters: “The market is collapsing.”

Red Kite, run by Michael Farmer, Oskar Lewnowski and David Lilley, has reportedly asked investors in its metals fund to approve an amendment that would require 45 days notice before money can be withdrawn - up from 15 days. The change will mean that investors have to send redemption notices to Red Kite by Feb. 15 to get their money back at the end of the first quarter.


Red Kite’s problems reflect the volatility inherent to commodity markets. Last year, returns generated by the firm’s Compass fund - which bets on metal prices - topped 90 per cent, MarketWatch said. But copper prices have slumped more than 20 per cent since December, with March futures trading at around $2.53 a pound - down from December’s highs of $3.29.
The report had a marked impact in the metals markets on Friday afternoon. In trading on the London Metal Exchange the price of copper fell 6 per cent, while aluminium was down 3 per cent and zinc slumped more than 8 per cent. “Fund liquidation…a lot of stops triggered…a lot of the stuff on the back of the Red Kite news,” another trader told Reuters.

--------------------------------


http://online.wsj.com/article/SB117038360266595775-search.html?KEYWORDS=red+kite&COLLECTION=wsji...

Red Kite, Hit by Commodities,
Tries to Delay Redemptions
By GREGORY ZUCKERMAN and ALISTAIR BARR
February 2, 2007; Page C3

There is more proof of how volatile it can get for hedge funds that focus on commodity markets.

Red Kite Management Ltd.'s $1 billion metals-trading hedge fund, a highflier that racked up gains last year, has suffered losses so far in 2007. Now Red Kite is asking its investors to give it more notice before they withdraw from the fund.

As of Jan. 24, the London-based firm was down about 20% for the year, according to an unofficial estimate that the fund provided to one investor. It was Red Kite's worst one-month performance in at least a year, according to an investor who has seen the firm's results.

That is a turnaround from gains of more than 190% for at least one of the firm's hedge funds last year betting on various metals. The hedge fund, Red Kite Metals LLC, was launched in October 2004.

A Red Kite executive, Oskar Lewnowski, declined to comment.

On Wednesday Red Kite sent a letter to investors asking them for permission to extend the notice period they give to withdraw from the fund. Red Kite, run by Michael Farmer, David Lilley and Mr. Lewnowski, asked investors in its metals fund to approve an amendment that would require 45 days notice before money can be withdrawn, according to a copy of a Jan. 31 letter from the firm. Previously, investors could redeem at the end of each quarter with 15 days' notice.

The change will mean investors have to send redemption notices to Red Kite by Feb. 15 to get their money back at the end of the first quarter, the letter explained, citing the size of the firm.

Hedge funds sometimes extend redemption-notice periods if they're expecting large investor withdrawals. By getting more advanced notice, funds have more time to sell positions and return investors' money in an orderly fashion.

riskanalyst, I think you should check your Q4 numbers again. The non-GAAP eps of 0.07 that YPNT discussed in its last earnings PR, was for the full year and NOT just the Q4.

It is important that investors understand that those non-GAAP numbers were used to show what the numbers would have been prior to the change in accounting for its advertising expenses, which are now expensed as incurred and not amortized. There were also significant one-time charges taken to settle various lawsuits, refunds, and severance payments. I think they chose to dump a lot of expenses in at the end of last FY to clear the decks for easy comps in FY07.

We'll see...

CHBD stuff....

From their Q2 2006 PR a year ago (explaining a bad quarter):

Josephine Chaus, Chairwoman and Chief Executive Officer, said, "We faced challenges in the second quarter as sales in our principal product lines were adversely affected by the difficult retail environment and by a shift in timing of certain shipments from the second to the third quarter. In addition, we incurred start-up costs related to the upcoming launch of our new Kenneth Cole Reaction women's line this spring. We anticipate improved performance in the second half of our fiscal year."

http://www.corporate-ir.net/ireye/ir_site.zhtml?ticker=chbd.ob&script=410&layout=-6&item...
--------------------

I think its safe to assume that they won't show the same type of y/y sales growth of 70% in Q3, but there isn't any way to really know given the reluctance of the company to provide much in the way of guidance to investors.

Would have been nice had CHBD been a bit more forthcoming about backlog, orders, etc in its PR. They didn't say much either in the last earnings PR, and it appears that the only mention of backlog is in the annual report.

I would be cautious about assuming that the sizable revenue gains are repeatable in Q3. Looking at their balance sheet, it appears that inventory levels are similar to last year, so they haven't stocked up for increased demand in the present quarter. This may not mean anything, but I looked at the Q1 2007 balance sheet and inventory levels were 26% higher than y/y levels. Perhaps they knew that shipments were going to be unusually high in Q2? Sometimes orders and timing of shipments can change dramatically according to customers' needs. Hard to say exactly what is going on behind the big surge in revs here....

R59, I was looking at TCHC's announcement today, and felt I needed to see a more unbiased view of what the FL homeowner's bill says:

http://senatormike.blogspot.com/2007/01/legislature-passes-insurance-reform.html

I'm not the best one to decipher all these changes, so would appreciate it if someone looked at ALL the plusses and minuses here and not just the company's spin....

Stockpeeker, zinc is down a bit at the spot level:
http://www.kitcometals.com/charts/zinc_historical_large.html

The price of zinc is looking like it might retest the 1.50 level.

2morrow, didn't the Dutton analyst forecast fairly flat eps growth in FY07 for HRBN? Revenue growth was expected to be strong, but (from memory) a combination of lower margins and/or additional dilution from the financing was going to work against the stock's eps growth....

The stock is now trading at 15x FY07 expected earnings. HRBN will have a difficult comp in Q1 because of the stock sales gain recog in that quarter, plus the fds count is higher. Perhaps it is still cheap, but I think most of the margin of safety has disappeared today. Q4 may be a decent quarter, but I would be concerned about Q1 comps and those for next year in general.

FY08 was projected to be very strong, from what I remember in the analyst report. Hard to tell how good/reasonable that estimate is, and FY08 is eons away in stock market time.

R59, I should clarify something about the decline in fd eps in Q3. Operating income was down around 6% y/y in Q3, and fds went up by 12.5%. The combination of the two (excluding all non-cash charges) is Q fd eps of 0.159 v 0.191 (-17%). So, not as bad as I said originally....but still down.

Those earnings are untaxed figures; my recollection is that HRBN's tax holiday runs out this year and they have to start paying around 7.5% next year.

R59, dig a little deeper into that Q3 for HRBN. Operating income was actually DOWN y/y and that 0.26 for the quarter included a big gain on warrants tied to the derivative liability issue...

Y/Y Q3 fd eps was down by about 25%.

Michael, I think you have your answer this AM why there was the big bidder for HRBN shares....

I guess no one at the Nasdaq discovered the early relationships among HRBN, BBC, and NYGG?? Amex forced BBC to restate more fully its payments to NYGG, and BBC is still in the doghouse with the Amex regulators. NYGG was clearly involved with HRBN at its early formation....but HRBN gets listed anyway.

Congrats to HRBN holders. I think this will be an interesting test of how much a move to the Nasdaq can mean in the short run for these Chinese OTC stocks.

Just a quick reminder from my previous notes for ISAC. They started recognizing tax benefits in FY06, so those projected numbers are untaxed AND contain a tax benefit. It also doesn't appear that they include the option expenses either!

"The Company's prior and updated guidance does not include $0.08 of anticipated expenses from the adoption of FASB 123R, under which the non-cash impact of stock options are recorded as an expense."

I think they disappointed last quarter, and had pretax income that was lower y/y than prior year Q3. That was a harbinger of things to come.

Pappy, I completely agree with you on UTVG. I think in this case, we have some big traders in the stock who are armed with a little bit of knowledge....and sometimes that can be dangerous.

Form S-8 is used when you want to register stock for immediate sale without going through a lengthy SEC overview. The worst kinds of S-8 filings are for consultants that get free trading stock for services performed for the company.

That doesn't appear to be happening here, although the company should clarify this. I'm sure the traders saw 3.77MM shares being registered for sale and decided to quickly exit.

Where are all the sellers today? This was a complete over-reaction fueled by a combination of day-traders and swing traders who had their fingers on the "sell" button. Certainly not out of the woods yet, but I think the stock should get back up to the 0.90s on its strong fundamentals.

powerbattles, I'm going on the chart. On Jan 3 the stock reached a high of 0.24 and is now down to 0.15, a decline of 38%. On Jan 12, 11 days ago, we had substantial volume of 1MM shares, and that has recurred for the past several days (volume of 1MM shares, with down days).

I think its safe to say that we have a big seller here. Who knows who it is? I can only identify the Market Maker on the ask who has been there since this decline began: UBSS

UBSS = UBS Securities

They handle executions for institutions, hedge funds, and retail customers, so it could be any of the above.

Ovidius, I am adding to my existing position on this panic selling. While I understand why some might think there are 3.8MM shares coming on to the market, I don't see things that way.

The volatility in some of these Chinese OTC stocks is unbelievable. This one has been in a trading range of 0.40 - 1.00 in the past 2 mos. Given that it had quarterly earnings of 0.03 in Q3; ytd fd eps of 0.06 (9mos only) its cheap.

If they can repeat Q3 in Q4, then its possible that we are looking at 0.09 - 0.10 for FY06. Why isn't this worth 10x that?

It looks like CKGT is going to hit that magic 10x ttm eps multiple today. They did an S8 filing months ago too...one that was much worse in that it triggered a stock comp expense in the quarter it was issued, plus it created immediate supply. Based upon my reading of the UTVG S8, this was for a stock compensation plan that has yet to be put into effect. Perhaps there are some affiliates who had restricted stock that can sell using this, but no way is it all 3.8MM shares!

I consider CKGT and UTVG to be very comparable in terms of their reverse merger, orphan status. If anything, UTVG has more of a "sexy" story in that they are dealing with travel into China and appear poised to do very well in FY07. Market doesn't agree with me today.

It will be nice to get the UBSS mm off the ask here. They must have a ton of shares to sell.....

I wonder if this is a retail seller? Or institutional? I've seen some of my trades on the bid get placed via UBSS, so if I had to guess, I'd say its retail....but who knows? There is a big owner of shares who is very unhappy with TCLL right now and has been selling steadily in the past 10 days.

Once (if?) UBSS goes away, the shares might get a lift. Income statement looks terrible, but the loss is only because of NON-CASH charges!

Most of those should be reversed in Q4 anyway.....so if they come out with a huge net eps number that is pumped up by a "gain" in the derivatives, does that stimulate buying demand?!?

He also told me that they are preparing an SB2 in order to free up the 144 shares. This would add 3 million shares to the float. It could help the stock trading after it is absorbed.

Unfortunately, this is part of the game when trading/investing in OTC stocks. This increase in supply would definitely depress the stock price if any sizable owner decides to sell. If these are 144 shares, then they would have to file something with the SEC (depending upon how much time has passed since their issuance), so there might be some warning, although most likely after the fact.

I agree with Pappy that a reasonable valuation is closer to 10x TTM earnings, but I would like some more color as to their future growth plans in 2007 and beyond.

Guy, not all S-8 plans are alike. Those shares for UTVG are to be issued under their company's newly created stock option plan....contrast that with CKGT's S-8 which was filed to create free trading shares for "consultants" and immediately expensed.

There will be a stock compensation expense in future quarters IF those shares are issued, but it should be amortized over the life of the options, according to GAAP rules. Consultant shares that are issued for services have to be immediately expensed, as they were with CKGT back in Q2 of its FY06.

KIK, the Q4 was ok for CKGT, and certainly the stock still looks cheap on a trailing PE basis, but I will be interested to see a couple of things in the 10K or subsequent PRs:

1) Why did margins fall in Q4? Net income was only 663k, which is roughly 13.5% of sales. That same figure was 26% in Q3....so what happened? Q4 fd eps was "only" 0.037...which is great for a stock trading at 1.12, but represents a sequential decline on increasing revenue. Not something I like to see.

2) Future orders/biz. Yes, they had a great FY06, but I doubt the pace they set was sustainable. Would have been nice had they included some order numbers to guess at growth possibilities in FY07.

3) Future selling shareholders. Always a problem with the Chinese OTC stocks. Don't forget that the company had filed an S-8 back in June that immediately registered 634k shares for future sale. I doubt that those have hit the market yet, given the low trading volumes here.

10bagger, I'm not ready to give up here either. TCLL probably doesn't qualify for VMC discussion because of the loss in net income recorded during Q3.

Come over here to discuss:
http://www.investorshub.com/boards/board.asp?board_id=4088

Joe, which of the former owners are you referring to? I speculated that Andre Salt, a significant holder of stock and former CEO might be behind the selling, but as the days pass I'm less inclined to believe that. He would have had to file either a Form 4 or 144, I believe, to indicate his intent to sell. I have seen nothing in the filings to indicate its a former board member or major holder that is selling. I would doubt that all of his shares are freely tradeable anyway....

Its time for Barrons to start burning up the phones to
a) bring in other institutional investors at current prices and
b) push management to be more forthcoming with info regarding operations and business conditions.

A decent PR campaign that explained the rationale behind the N2J acquisition and provided an outlook for FY2007 would be helpful at this point. They have pointed out in the last PR that the biggest charges were non-cash in nature, but lots of investors just look at the bottom line and skip over the details.....

At some point, investors will realize that this isn't going hit zero, and there is a lot of value hidden in the current share price. I think that as an earnings play, the upcoming quarter will be a great opportunity for daring investors, but the market is strongly disagreeing with longs at the moment.

Jking, I agree with you. This is determined selling, source unknown....they obviously feel that something is wrong with the company and want out. Anyone unfamiliar with derivative accounting would quickly pass this by, but imagine what the Q4 income statement is going to look like if most of those charges get reversed by mark-to-market accounting??

This is certainly a speculative stock, but at 0.15, I could see it easily doubling....don't forget, Q4 is their best quarter, on a seasonal basis. If they can hold margins similar to what they did in Q3, this will be a very strong quarter.

Retired, while I understand the importance of getting off the OTC:BB exchange in order to attract institutional support, it seems to me that IEAM has done quite well in attracting some savvy hedge funds to buy its stock.

The underlying fundamentals or valuations don't magically change when (or if) IEAM makes the jump, although it could be fairly argued that the forward PE multiples might expand a bit.

I think the expectation of some big pop just because IEAM gets on Nasdaq is unrealistic; any jump on the news might be fleeting.

Looks like JLF Asset has been a buyer of IEAM over the past few months....they appear to have increased their position by about 2x after factoring in the 1:10 reverse split.

See SC13G filing today.

Free real-time quotes coming to Google Finance?

http://googleblog.blogspot.com/2007/01/real-time-quotes-for-free.html

CSCT.ob DD
=====================

Name: China Security and Surveillance

Biz: manufacturing, distributing, installing and maintaining security and surveillance systems. Our customers are located throughout China.

Customers: mainly government entities (customs agencies, courts, public security bureaus and prisons), non-profit organizations (including schools, museums, sports arenas and libraries) and commercial entities (including airports, hotels, real estate, banks, mines, railways, supermarkets, hospitals and entertainment venues), which account for approximately 40%, 20% and 40% of sales revenues, respectively.

Catalysts for growth: Regulations promulgated by governmental agencies in China relating to security and surveillance often create opportunities for us. Currently, there are a number of formal and planned regulatory drivers which we believe offer significant growth opportunities. These include the estimated $6 billion to $12 billion that the Chinese government expects to spend for security infrastructure in preparation for the 2008 Olympics, along with the planned investment by Shanghai for the 2010 World’s Fair. In addition, several ordinances have been passed by the Chinese government which require security surveillance systems to be installed in: (1) 660 cities throughout China for street surveillance; (2) all entertainment locations; (3) all Justice Departments and Courts; and (4) all coal mines in China by the end of 2008 (currently estimated to be 28,000).

Make good provisions:
In connection with the private placement, Mr. Tu Guo Shen, the Company's Chairman, has agreed to place a percentage of his shares in China Security and Surveillance, in an escrow account as part of a make good provision until such time as the Company has achieved its projected net income for 2006 and 2007 of $17.49 and $34.1 million, respectively.
(NOTE: there have been a couple of acquisitions of profitable companies since this pledge that have not been factored into these provisions)

FDS (est): 32-35MM

Recent trends of order activity:
Q2 06: 32 new contracts; $23MM value
Q3 06: 51 new contracts; $32MM value
Q4 06: 58 new contracts; $43MM value

Seasonality:
Our sales are affected by seasonality. Our revenue is usually higher in the second half of the year than in the first half of the year because fewer projects are undertaken during and around the Chinese spring festival.

Analyst estimates:
http://finance.yahoo.com/q/ae?s=CSCT.OB

Website: http://www.goldengroup.cn/

Other items of note:
This is one of very few companies to have a factoring arrangement with a Chinese bank:

China Security and Surveillance Technology Inc. Secures New Factoring Facility With China Construction Bank to Capitalize on Safe City Projects
Tuesday October 3, 9:15 am ET

This facility will provide financing of up to 80 percent of the total contract amount for projects which qualify under this initiative, while government customers will pay the difference to China Security throughout the implementation process.

As part of this agreement, China Security will make periodic deposits with China Construction Bank, which, depending upon the specific project, will provide a maximum factoring capacity of five to ten times the amount deposited.

The Safe City Project is a nationwide initiative to enhance general security in China's cities, which include the implementation of new surveillance cameras in highly trafficked areas throughout a total of approximately 660 cities.
China Security has previously signed several smaller contracts related to initial trial projects, but the majority of the projects are expected to begin in 2007 and continue to ramp into 2008 in preparation for the Beijing Summer Olympics.

Additionally, by having the access to these funds, China Security can differentiate itself in the competitive market place versus other undercapitalized competitors.

--------------------

To sum, CSCT has multiple opportunities for growth. It is starting to build momentum and differentiate itself from its competitors. China has mandated security regulations that will keep this company busy, as well as other major events like the Olympics and the World's Fair. I think the orders will continue to grow throughout 2007 and i like the strong, sustainable organic growth. This is a stock that can appeal to both growth and value investors, and may even attract the attention of the momentum crowd as well....(perhaps it already has given that it is up 225% from its low point of 4 over the summer.)

Michael and I are in agreement.....CSCT is my choice as well.

I've posted some older DD on it when it was in the low 4s, but I'll add to that again when I get a chance over the weekend.

Joe, here's my guess at who the seller might be:

http://www.investorshub.com/boards/read_msg.asp?message_id=16173929

beigledog, I think the MMs are working a large sell order. They are probably assessing the level of demand for the stock at 0.18 and then might move it down a bit lower to clear out the rest.

Hard to know how aggressive they feel they have to be to get rid of it, or if its just a limit order placed at 0.18. If no one tries to jump in front of the ask, my guess is you'll see the MMs grab some inventory by taking out the rest of the order by the end of the day today....

Doesn't seem to be any concerted effort to walk it down. We'll see!

There are no new filings that I've seen to trigger this activity. The r/s appears to have hit some snag, or they would have announced it by now....

Of course, the business fundamentals are always going to be a question, and we just don't know very much about how the quarter has gone. Q4 is supposed to be a stronger seasonal quarter for them, but that didn't hold true in FY05. This company is PR challenged!

R59, re TCLL. There definitely is a block of shares for sale at 0.18. I picked up some of it as well, along with everyone else this AM.

I suspect that it might be Andre Salt, a former CEO who has a ton of shares but doesn't seem to be part of operations anymore:

Item 5.02 - Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers

On August 22, 2006, John Sumnall and Neil Proctor resigned as member of the Board of Directors of Tricell, Inc. (the “Company”), effective immdiately. There was no disagreement or dispute between either Mr. Sumnall or Mr. Proctor and the Company which led to their respective resignations.


On August 22, 2006, Andre Salt resigned as chief executive officer and chairman of the Company, effective immediately. There was no disagreement or dispute between Mr. Salt and the Company which led to his resignation.


On August 22, 2006, our Board of Directors appointed James Reed as Chief Executive Officer of the Company to fill the vacancy in this position created by Mr. Salt’s resignation. Mr. Reed has served as President of the Company since November 18, 2005.

----------

In the last proxy statement, he is listed as the owner of 24.2MM shares of TCLL stock (pre reverse split).

Perhaps he is deciding to sell a few now?

I am going to chicken out and not pick a stock but a sector: China. I have been bullish on Chinese stocks for a while, and feel they are still in the early stages of their advance, especially some of the OTC:BB stocks we've mentioned here.

I feel that the industrial sector in China may be a bit dicey this year, as the govt continues to crack down on reckless spending and as banks try to clean up their balance sheets of the worst of their loans. IMO, these loans were made to finance the buildout of some dubious public projects.

So that leaves the service and consumer sectors in China. The chinese are some of the world's highest savers, and I think there has got to be lots of pent-up demand for goods and services. In addition, there are multiple catalysts coming up over the horizon in 2007 and 2008 that require continued improvements in infrastructure, security and convenience:

3G buildout (starting 2007?)
Olympics (2008)
World's Fair (2010)

I would go with a spread of low PEG China stocks in the consumer and service sectors. Stocks poised to take advantage of these macro trends:
CSCT
CXTI
TBYH
UTVG
CPHI

I own them all, with heavier weightings in CSCT and CXTI. I think CSCT and CXTI will make the jump to Nasdaq at some point this year, and if so, it should lead to expanded PE numbers for both.

Gilead, I'm not sure how impressive those numbers will be for net income.

This is an unusual choice of words to describe the revenue growth:

""As in any growth situation, growth in revenue does not relate
linearly to growth in earnings. Revenue growth always seems to lead
earnings growth; but, it should be expected that earnings growth will
occur when a fixed level of overhead is spread over a larger
revenue base.

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??? This explanation of being unable to leverage their revenue growth is dubious. Good companies should have no trouble expanding their margins with strong rev growth.

My translation: revenues were strong, but it didn't get down to the bottom line this quarter.

Isn't hospitality their lower margin biz anyway? And why no mention of their other division's results? Minch (or Cecil Whitmore?) is simply awful when it comes to writing PRs. This one sounds to me like a positive spin on a bad quarter...

Michael, I was able to purchase UTVG through Zecco and Fidelity.

Wade, I'm not going to rule out BBC for future investment, but I think they will have about 2-3 quarters of mediocre results before investors start to focus on FY08 possibilities. As always, timing is an issue for making a smart investment.

Its certainly possible that the worst news is out, and the stock will now benefit from forward looking investors who are looking out to FY08....but I think its a bit early. If I were short, I would definitely start covering now, and that is the reason behind the rise today, imho. The new guidance is a disappointment, given what the company had said just a few months ago. Given all the inconsistent and misleading statements made last year, the big question is can we trust anything said by management at present?

The numbers usually speak loudest, and they show a poor end of the year and difficult comps ahead until Q4 2007, when new capacity is scheduled to come on-line. A year is a practically an eon for small caps like BBC. I definitely wouldn't chase here, but to quote sskillz: "I could always be wrong though."

R59, BBC still has a long way to go in managing their growth and in explaining the difficulties inherent to their company and industry. I think the rise today is either a) some short-covering or b) investors who think the worst is over and are looking at the projected eps of roughly 0.71 for FY06 and seeing a PE <8x and think its too cheap.

Here are some things that strike me:

1. Guidance assumes Q4 numbers of 3.4MM in rev (vs 7MM y/y) and net income of 1.1MM (eps: 0.06 v 0.07 y/y). Bad quarter, and this comes after they had said earlier that Q4 would show growth in sales and earnings:

""While the fourth quarter, which represents the end of the harvest season, typically is our slowest period of the year, we expect to continue to achieve year-over-year revenue and earnings growth in the last quarter of the year.''
-Nov 14 PR.

So, they got that wrong.

2. Mancozeb production was never ok'd by the govt....why wasn't this disclosed earlier?

3. Construction really did cause "material" disruption over the year....again, management never acknowledged this and now says everything should be ok soon. This will still be disruptive through Q1 07.

4. Xinjiang "Sales contract" clarification. The company's PR earlier this year regarding 200MM in supply was confusing and plain wrong. We had several discussions on this point earlier this year, regarding the fact that the company could not have both increased its capacity while at the same time booking sales....turns out it really was just an agreement to be able to build a new facilty capable of increasing capacity by 200k metric tons.

5. Trade show numbers: disappointing. No y/y growth, and that is all related to lack of capacity.

6. Capacity won't be increasing until later in the year:
"Construction of the facility began late in the third quarter of 2006 and the Company currently expects to begin initial production at the new facility during the third quarter of 2007." This took way too long to build out. Plus, whatever happened to the other facility in the NE of China? No mention of that.

7. Karen Wang resigning for health reasons. Her "health" had been an issue throughout the year; my guess is that she is probably stepping down because she was asked to do so by other investors/BOD. Big question: what happens to all her shares? Will she start to sell some?

I think the stock is undervalued if we look out to FY08 numbers, but a lot can happen between now and then. If you have a long-term focus, then it might be ok to start nibbling, but I think the stock will retest the <5 level again.

Other issues: A/R growth and possibility of write-offs?