PRZA 0.20 +0.07 78,200
another former Keating's darl'n is doing fine ...
Dutton Associates Announces Investment Opinion: Purezza (Puda) Strong Speculative Buy Rating In Initiating Coverage By Dutton Associates
Dutton Associates initiates its coverage of Purezza Group (OTCBB:PRZA), with a Strong Speculative Buy rating. Shortly, the announced name change to Puda concurrent with a 1-10 reverse split will take place. The 21-page report by Dutton senior analyst Silvia M. Kwan, CFA is available at www.jmdutton.com as well as from First Call, Bloomberg, Zacks, Reuters, and other leading financial portals.
Purezza recently completed a reverse merger with a coal washing company, Shanxi Puda Resource Inc. ("Puda"), in the People's Republic of China (PRC). Puda has a total annual coal cleaning production capacity of 500,000 tons, and its management believes Puda is one of the top three coal washing companies in the Shanxi Province in the PRC. To further strengthen its market position and enhance its competitiveness, the Company is aggressively increasing its production capacity. Puda is planning to triple its capacity in the fourth quarter of 2005 through the acquisition of production facilities from a related company, Puda Resources Group Co., Ltd, which has the same owners as Puda. Given the robust economic growth in the PRC, the demand for coal, and especially high-quality coal, is expected to remain strong. In our opinion, the Company offers investors a good opportunity to invest in China's high-growth coal industry through an attractive niche business. Net profit is projected to grow at a compound annual growth rate of 68% over 2004-2006 to US$10.4 million from US$1.97 million in 2004. For 2007, revenues and net income are forecast to be US$78 million and US$13.1 million respectively. At a target price of $0.28 ($2.80 after the above planned 1-for-10 reverse split), the Company's shares are trading at a prospective 45 times 2005 diluted earnings or 20 times 2006 diluted earnings. Investors should, however, be aware of the very limited trading volume of the stock and that insiders own 90% of the outstanding shares.
About Dutton Associates
Dutton Associates is one of the largest independent investment research firms in the U.S. Its 27 senior analysts are primarily CFAs(R), and have expertise in many industries. Dutton Associates provides continuing analyst coverage of over 100 enrolled companies, and its research, estimates, and ratings are carried in all the major databases serving institutions and online investors.
The cost of enrollment in our one-year continuing research program is US $35,000 prepaid for 4 Research Reports, typically published quarterly, and requisite Research Notes. The Firm does not accept any equity compensation. We received $31,500 from the Company for 4 quarterly Research Reports with coverage commencing on 8/16/2005. Our principals and analysts are prohibited from owning or trading in securities of covered companies. The views expressed in this research report accurately reflect the analyst's personal views about the subject securities or issuer. Neither the analyst's compensation nor the compensation received by us is in any way related to the specific ratings or views contained in this research report or note. Please read full disclosures and analyst background at www.jmdutton.com before investing.
Dutton Associates
John M. Dutton, 916-941-8119
Source: Business Wire (August 16, 2005 - 12:30 PM EDT)
