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Combating the mudslinging shorts who cross the line.
I felt strongly about the intent behind the 62 PE message on the YMB today and so I responded decisively to do what the law allows to at least curb the puffery and shenanigans.
CCME is such a great opportunity in the right place at the right time that it just needs the facts to be out there without the unfettered deliberate obfuscation campaign of calculated falsehoods.
I also think it might be prudent to list all the short theories and allegations, and send them directly to:
1) Deloitte
2) Jacky
and
3) Each of the Directors.
We all know the company is legit, so no shareholder harm can come from sharing the mud-balls being thrown at CCME. Meanwhile, maybe, possibly, perhaps, the next audited filing with the SEC might possibly include one or more sentences that refute these claims.
-Andrew
Title: Some observations about shorts and CCME prospects.
Hope you are all having a nice weekend. Been enjoying the discussion. Below are some observations.
My pet issue: In explaining the attacks at CCME, I'd also throw in that the more Westernized the appearance and non-western style interactions of CCME to its shareholders (quality of translation, lack of my proposed translation guarantee, low quality of investor day video, lack of transcripts, notr enough videos of various buses and those on the buses being interviewed, lack of additional and reputable impartial third-party study of the bus rider demographics (the better and more cumulative the demographics data over time, even from varied sources, the stronger the CCME thesis), etc).-- and more importantly, its potential and prospective shareholders, as well as retail brokers-- the greater the interest by retail investors and the less likelihood of concerns/fear/question marks which can cause the investor and broker to remain on the fence. While there are several explanations for the short attacks/claims having any effect on convincing fence sitters and reducing purchase quantities of the shares, the cultural and language barrier, together with distance, has a significant impact on total interest and comfort. The sooner CCME appears like the company next door, the higher CCME will climb.
Additional observations:
None of this means there is anything wrong with CCME's fundamentals. CCME is going much higher this year.
Just do some simple math over the next three years and you can predict quite some cash on the books, still zero debt, several dividends paid (perhaps even with a sequential increase), all the so-called dilution (compensation for meeting certain goals by management) vested, (as if no IPO has shareholder dilution from the deal itself!!), and more and more released Deloitte-audited financials, as well as dividend payments.
If you want me to sell, just show me a filing or announcement that Deloitte will not be the auditor, that CCME received a reasonable takeover offer, or massive insider selling. Until then, CCME is the golden goose.
Another point about the shorts. They are so desperate now that they are actually spreading misleading innuendo about CCME online. Personally, I do not think the deep pocket shorts are spreading these rumors. I think it's the copycat shorts who grab what appear to be big money coattails. i.e. the prospective little short sees the big short position, and says hmmmmmm, maybe I'll just jump on the bandwagon and ride this down.
However, I would not be surprised if some of the more professional bashing by those who have no direct personal stake is actually at the request of the deeper pockets.
We can speculate about this ad infinitum; it just does not matter. Shorts, temporary shorts (some of the traders) and bashers can cry foul, fraud, everything they want. CCME has fundamentals. That's why institutions buy CCME and that will carry CCME to a PE of 40 or more in the next few years. I said, PE, not share price. You do the math :)
The maturation of the Chinese middle-class/upper-middle class, and the need of Fortune 500 companies to communicate with and establish their brands (not to mention build earnings from these hundreds of millions) is a tsunami-like mass-macro play that cannot be denied any more than the effect of interest rates.
Honestly, if longs wrote nothing more about CCME and all the shorts bashed daily, Deloitte-audited CCME would still reach a PE level which matches its China-quasi-outdoor media industry competitors. The fundamentals are just too good.
Caveat: I am not yet comfortable with the 400-500 points of presence initiative, nor do I quite yet have all the facts about it to establish comfort. Similarly I am not yet experiencing discomfort because management is economically rational, frugal, and seems to know how to build a business, so the initiative cannot possibly be all at once-- so not much worry about it. If that initiative is a losing proposition, a rational management, i.e. former Pricewaterhouse Jacky will surely bring the initiative to an end.
Finally, I am looking to buy more on drops. There is a golden window before the next earnings and the first dividend which will have long since passed once this thing explodes. And I'm not just talking about the short squeeze, but rather that point when large caps institutions get much more involved.
-Andrew
I have been searching for the web traffic too. Am very interested in seeing the results.
Was thinking of another way to distinguish CCME as a quality company.
So I posit the following:
How many of the institutions have CCME because of its individual quality and how many have it as part of an index?
A graph or chart distinguishing these justifications for the institutional ownership would be interesting. How this chart changes over time could also be illustrative.
-Andrew
Timothy:
Sounds like you are saying Cramer, like Buddha, should promote experience over theorizing, before drawing his unenlightened conclusion.
;)
-Andrew
Ryan and All:
I wrote Cramer this evening asking him to do homework on CCME. Was rather frank.
You are right about dividend as a reinvestment to position Jim to agree.
Perhaps if you tweek the question even more as follows:
"I have Apple, Kohls, Ford, and Gold. China Media Express is my spec and they just paid me a regular dividend. Is it OK to reinvest that dividend in CCME?"
Note the shortness and obviousness of these big names and implying GLD, juxtaposed to CCME with the dividend angle you recommend.
-Andrew
Majik and everyone:
This is just the beginning of a fantastic ride. Along the way, there will be ups and downs in the charts. The ups will dominate for years to come.
The more long term, the more fantastic this ride can be.
We may well have caught the CCME Express.
Have a great weekend everyone.
-Andrew
This was probably the post you read. Interesting idea. Could be true.
http://messages.finance.yahoo.com/Business_%26_Finance/Investments/Stocks_%28A_to_Z%29/Stocks_C/threadview?bn=101061&tid=34598&mid=34601
-Andrew
Would anyone here care to posit how may buy and hold retail or institutional shareholders come in to CCME on a given day, and how many shares they buy. I mean investors who trust management is for real, trust Deloitte, perhaps like the dividend idea or foresee share buybacks, people who invest like my father's generation, and who intend to hold the investment for many years.
Put another way, what percentage of daily volume is trading/shorts and what percentage is long term serious? How many such shares do these serious investors purchase. How many trading days will it take for these new entrants to tie up what percentage of the float.
To me, even at a snail's pace, there are new investors each day going long term. Maybe a sliver here and there, but they add up and take shares higher.
-Andrew
That brilliant fund only has 200 shares of AAPL. Neutral or not, what a waste...
-Andrew
Flipped through the catalog and pages in Chinese looking for anything familiar. Saw the Media Express phone number and noticed Jackie Chan in the Cannon ad.
Sadly I still need to learn to read and translate Mandarin to really enjoy the depths of the catalog. My local translator tells me the media express bus logo (with the tm) has words on it which essentially mean "high speed".
CCME is a growing and diversifying media company. Who knows, maybe one day they will buy their most profitable bus line... (hope not)
The shorts will be out of business soon enough. At least we're not watching paint dry any more.
-Andrew
Agreed. How about more institutional buying. The flight to quality will happen. With it the higher and new battleground share prices.
Just waiting patiently for the new research. With this perfect upside storm brewing, someone credible will opine sooner rather than later.
Lots of talk about MS, but who is to say they will or wont. Am confident someone credible will initiate coverage.
This apparent naked shorting is unbelievable, even if not naked it's hard to believe the break out can appear this nullified by shorting. Cannot wait for the day that the next credible research comes out on CCME, the game changer to hang the shorts high.
Still, with so much on the balance sheet and the price headed higher, why not buy back some CCME shares? Some is always better than none.
Invest wisely.
-Andrew
Strong close today and early morning strength makes me happy I loaded up 55% more on Friday, even paying a bit higher than what was normal price range in the weeks leading to Friday. Wanted to be loaded up. Still do. Of course the market was up today and first day of trading in a year is the first chance for institutions and funds seeking to build performance for the whole year.
Funny thing is someone was taunting me on the YMB about the small increase on Friday not being a big deal. I saw it as the beginning of a breakout from the recent under-oval pattern. Happy to be proven right today.
-Andrew
Call me a dreamer... I just send the below to Jacky...
What an addition to the CCME story this would be...
Some of you may like this; some may disagree. I know this or something like it would be well worth the cash to make it happen.
Happy Investing,
Andrew
______
Jacky:
CCME sells two things: 1) media access on buses and at airports (to Mandarin-speaking audience) and 2) CCME stock shares (to a North American English-speaking audience).
CCME should be the first Chinese company ever to institute and adhere to a "Guaranteed Most-Western-Friendly-Translation-Policy" including:
1) modernized translation by two separate American and/or Canadian accredited independent modern English translation services; all forms of CCME media shall be translated including all Mandarin found on all brochures, conference calls, websites, videos, and all media produced or provided by CME and its affiliates.
CCME should also allow American shareholders on iHub to recommend an FAQ (frequently asked questions) (again in perfect modern English) section for publication on www.ccme.tv.
To do this safely, CME would literally hire a professional translation and media firm just like CME hired Deloitte for accounting.
I know this is expensive. But it's worth every penny to boost investor interest and trust since CCME was SPAC and not IPO.
Deloitte was a good move to give CME credibility. The financial news would be very interested in CME being the first Chinese company to contract North-America-educated translators (educated entirely in the US or Canada who speak, write, and translate English like Americans or Canadians) who are also fluent in Mandarin doing translations. The translations would be reviewed by Loeb and Loeb or your lawyers and accountants.
Yes, this can cost a lot at first, but public image increases trust which increase the share value. After full dilution, an increase of one dollar per share = US$50,000,000. This translation policy would double your share value and cost less than a million dollars. [in my opinion]
CCME would become world famous for a translation policy, especially one which included responsiveness to documented shareholders and media companies who report mistranslations or untranslated Mandarin. A turnaround time of 5 days (120 hours) would be very reasonable and respected. The shorts would panic as this would make CCME transparent and list CCME as one of the 10 Shareholder friendliest companies on planet Earth. Institutions would love this too as CCME would become a brand name company to boast of owning.
Forwarded here are three (3) messages from Yahoo and one (1) message from IHUB about CCME. Many of your shareholders who contact you have recommended that I send these suggestions to you. Ask Americans or Canadians who post on Yahoo and IHub about this idea and how the publicity can improve CCME's image and boost investor confidence.
Modern English through a "Guaranteed Most-Western-Friendly-Translation-Policy" verified by two separate respected third parties (double verification) means accuracy and dependability. When you increase American and Canadian shareholder access to information in English, CCME earns trust from prospective shareholders. and CCME commands a much higher share price.
The more CCME appears the neighbor next door, the higher the prices will go.
Thank you,
Andrew
In the last hour of 2010, I added 55% more to my CCME holdings. A dime or so higher than perhaps I should have paid, but I am very comfortable with the price relative to the likely reward. Sometimes you just want more shares to have a better bang for your buck when the action does come.
2011 will be the year of Linear CCME. And 2012 will be the year of Exponential CCME.
Look forward to watching with you all.
Happy New Year!
-Andrew
Hello CCME IHub Discussion Board. Thank you for the invitations.
With all due respect to Yahoo's unique service offerings for investors, I am growing ill from the widely diverse communications and risk-free (high beta (joke-intended)) maturity levels YMB alias privacy produces with as much precision as Lamarkian experimentation fails to yield genetically altered offspring. For me, it's time to take the next step, to expand my horizons to another discussion board. So today, TFL arrives on IHub.
Not sure how active I plan to be. Am enthused by CCME's numbers and prospects; am frustrated by the management's PR to its likely shareholders.
All things continuing as they are today, CCME will emerge, dollar for dollar, as one of the best media companies in the world, and certainly a top draw in China.
If none of us ever wrote anything, and CCME just continued silently with the shares remaining only at $15.75, CCME would continue like my other favorite, AAPL, to generate balance sheet cash until ultimately book cash itself will equal market cap. (One takes much longer than the other...)
So I am comfortable holding CCME for 5-10 years or longer, assuming management never sells out to a conglomerate or makes some unpredictable purchase in an effort to be "the biggest media company" without regard for quality or utility.
As much as I want to help CCME garner interest and trust from English-speaking investors, I feel as though CCME knows enough to help itself but chooses not to take needed steps.
When it comes to image, I know from ample enterprise level marketing negotiations experience that corporate ears are all too often deaf, scared, or distracted. Convince a company to change or add a branded, memorable phone number as many times as I have, and you will know what I mean. The decision for image change, modification, development, or initiative comes slowly or, more often, not at all. The fear of loss of control and change of the status quo can be debilitating, even stagnating to the executives. Someone may even end up admitting a past mistake and fearing for their PR or marketing contract. There's often an incentive to shoot down a good idea for fear of loss of hegemony and/or income.
Regarding corporate communications to prospective retail shareholders, to apologist longs, you should expect more from a media company. CCME is not just running a Chinese media company; it also markets and hopes to increase demand for its shares by traders, investors, and regular folks looking for quality diversification outside the US. These prospective purchasers predominantly speak only English. (I can only imagine the Mandarin is top notch; really hope so, anyway).
In stark honesty, the site (ccme.tv) was an F+, and is now a -C. It should be a B+ at least. A function of the poor grade is largely attributable to the low quality of the Investment-related video communications which both add and detract from the CCME image. Even the dates should be westernized to the US standard, i.e. January 1, 2010 vs. 1 January 2010. The Internet is a marketing tool that goes far beyond the SEC filings. CCME.com should sell shares at market. The new site, SWITOW, should have easily accessed translated pages that also serve to sell CCME shares at market. CCME needs to recognize it is selling its shares to Americans and Canadians too.
To convey authority as the top investment for Americans seeking value, growth, capitialization on the growing middle class, diversification from US-based businesses, and even safety in China, CCME should trend-set and lead its peers with high-end English translation as a policy and promise. What a comparative attraction. The Investor day video needs a printed translation audited for translation accuracy. I can go on and on as I and some others have on YMB. I'm not an apologist or an idealist. I am a realist. I really expect more.
I'd rather be able to boast that CCME has not only the most shareholder friendly management in China, but also the most Western-friendly management in China. That's a way to bring investors to CCME until the cows come home. But what do I know. I'm just a lawyer with a knack for spotting trends. I'm no accountant, and I certainly don't speak Mandarin.
Maybe I need to just buy more CCME shares and be happy with the value they represent when the next credible research initiates a strong buy rating. Maybe I am too hopeful for corporate support from so far away. Maybe I should just be thankful I found CCME to begin with.
I have one more day to increase my 2010 position. Probably will.
Again, thanks for inviting me to join this discussion board. Hope I add something positive and constructive to this mix.
-Andrew