Tuesday, November 07, 2006 2:31:35 AM
this company. All the what if posts about GBDX made $300M, or $500M last year IMHO is invalid, and not verified.
If GBDX was making that much money, there would be no need for a merger with former mgmt. of WWCD.
To invest in this stock, I look at real profit going forward starting with the first shipment of diamonds this week, and the size of share count, period. IMHO, there is no other confirmed #s that are acceptable.
Again, Recently, there began a huge increase in demand for top quality stones and KEY-the new change in russian law of larger % of rough cut diamonds allowed to be exported. With that, the former mgmt. of WWCD saw an oppty for its next merger in GBDX. Because, with GBDX-1.)the solid reputation and 17+ years of doing business in the NY diamond district GBDX has and existing contacts, clients to capitalize on.
2.)The existing strong contracts GBDX still has with top russian cutter and exporters. (taking advantage of new russian law)
3.)GBDX wasn't a large company and was ripe to merge with to gain entry into russia with the new change in russian law. GBDX had the connections, former mgmt. of WWCD had cash to grow the business. With such a small share count compared to potential revenue, makes business sense to not use a cash outlay or debt for additional funds. If the minor increase of share count is used to increase assets (more diamonds), then $ being used right.
IMHO, with that, yes, and increase in share count will be used to obtain capital to expand inventory with increased demand.
Forget all the hype about past revenues. Focus on the current super small float and anticipated large revenue comparitive. This drives pps.
Best Regards
My opinion only. Not a buy or sell recommendation.
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