THE NSOMNIYAK CHALLENGE
For my original 6 picks for this PSL 15 contest, I own BEST, CHGY, FEEC and JGBO, but I don't own NIV and SECX. The reasons I picked them are listed below:
BEST - Traded less than net tangible assets and forward estimated PE=7. Business has been improving with continue increase in revenue. It just posted a good earning quarter.
JGBO - This is a uplisting play. I expected that JGBO would move to a big board listing during the contest period (It actually moved to Nasdaq listing last Friday). This may be the catalyst to boost the share price. Very low valuation with forward PE=4 and P/B less than 1. Majority book value is in cash.
CHGY - This is also a uplisting play together with low valuation. I expected that uplisting to AMEX would occur between July and September this year. It is traded at forward PE=5 for this year. It had appointed 3 independent board directors last Friday. It is getting closer to AMEX listing. It looks like a storng Q2 earning report next month with smooth coal production and higher coal price in Q2 per my discussion with the company.
FEEC - CBM business is booming in China and FEEC has the best CBM blocks in China with lots of gas (18 -24 TCF gas in place). Gas sale agreement is expected to be signed in June or July. Chinese gas reserve number may be available in Q2. Commercial gas sale is expected in Q3. SEC gas reserve may be available in Q4. The deal between Arrow and FEEC may be approved by Chinese Government in August. The short term risk is dilution by a possible equity financing.
NIV - Trailing price/earning less than 4 and Nasdaq listing. This is a cheap stock for one of the major producers of audio and viedo products in China. The business still looks good going forward.
SECX - Very low P/S =0.03 and a good earning report in the latest quarter is the reason I picked it for the contest. Technically, it formed a good base and any good news or earning number next Q may pop it.
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