Posts related to ‘Micro Cap’

The Next Stocks That Could Go Under $1 (CHTR)(SIRI)(F)(LVLT)(ABK)(AIG)(NCC)(C)

95129cA year ago, it would have been hard to find people who would believe that Sirius XM (SIRI) or Charter Communications (CHTR) would trade below $1. Sirius had a 52-week high of $3.92. Its merger, which was to create one satellite radio company, was supposed to push that share price up. But, it has over $1 billion of debt to be refinanced next year. Today it fetches $.37.

Charter is in a pretty good business. As a cable provider it markets digital TV, broadband and VoIP services. The company has more than five million customers. It also has over $20 billion in debt. The stock changes hands at $.38. That compares with a 52-week high of $3.94

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Posted on: October 17, 2008 – 10:15 am in Micro Cap, , , , , , , ,

Evergreen Solar (ESLR) Up 20%, Caveat Emptor

Evergreen Solar (ESLR) is trading up 20% to $10.86 on news that it signed $1 billion worth of contracts.

The larger of the deals involved is with German-based Ralos Vertriebs GmbH and has a face value of $750 million. But, the terms spread the agreement over five years, ending in 2013. It is not clear what the cost of sales here is. Wall St. may look at this as roughly $150 million per annum with a return which may be modest.

ESLR traded above $18 at Christmas last year.

Solar companies have done well lately because of the alternative energy craze. But, Evergreen Solar has been something of an exception. Its first quarter earnings were very disappointing. Revenues were $18.3 million for the first quarter of 2008, compared to $16.9 million for the fourth quarter of 2007 and $12.6 million in the first quarter of 2007. For a company in a "hot" sector, that growth is modest.

And, the company had an operating loss of $7.5 million, about two-thirds of that for facility start-up and write-off costs. That would tend to speak poorly of management.

Evergreen looks good on the news, but no so strong on its merits.

Douglas A. McIntyre

Posted on: May 22, 2008 – 11:03 am in Micro Cap,

Business Week Gets More & More Speculative (ABX, CBLI, UEC)

Business Week’s "Inside Wall Street" weekly column has been known for moving stocks.  In fact it has been influential enough that people have been busted for insider trading via getting the names ahead of time and front-running the magazine.  This week’s column  looks more speculative than fundamental, which you can see if you go inside the real guts.  Here are the basics:

  • Barrick Gold (NYSE: ABX) was noted positively with the stock being called as "going to $75 in 18 to 24 months" by Schaeffer Research.  This is actually a call on how to play gold going above $1,000… just keep in mind that this is total performance chasing, even though it cites a near 10% pullback as Barrick has doubled in the last year and this is one of the largest pure-plays on gold out there.  Jim Cramer named this one recently as his speculative gold stock for 2008.
  • Cleveland Biolabs (NASDAQ: CBLI) was listed as being able to nearly triple after being cut in half.  Two mostly unknown pundits have spoken positively about it despite the company losing its largest potential Defense Department order for its anti-radiation drug Protectan, which lost out to Osiris Therapeutics (NASDAQ: OSIR).  It lists foreign government contracts, and its potential for oncological hopes in chemotherapy.  This one seems extremely speculative with a $56 million market cap, even if only 2.5-times net book value with essentially zero in real revenues.  This was one that we also recently noted as one of the many biotechs hitting 52-week lows.
  • Lastly noted is Uranium Energy (AMEX: UEC), a volatile speculative stock in the highly volatile uranium sector.  With so many already producing uranium and many being less speculative in a speculative group, this one is noted as having a new mine going into production in 2010.  If you look at our past grouping of uranium calls as the nuclear sector heats and cools, you’ll see why this one is definitely one of the more risky plays out there.  This also recently moved from the OTCBB to Amex, and was one we asked "when is enough finally enough?" in many of the uranium names.

We’ve seen the "Inside Wall Street" column give some great calls before, and we’ve seen it give some duds.  It’s too soon to call these out entirely, but twoout of these three have a real risk at ultimately giving investors a chanceof sitting on a goose egg.

Jon C. Ogg
February 22, 2008

Posted on: February 22, 2008 – 6:15 am in Analyst Calls, Biotech, Metals, Micro Cap, Nuclear, , , , ,

Does China YouTV Remind You of Anyone? (CYTV-OTC)

China YouTV Corp. (CYTV-OTC) is one stock that has been on a tear in recent days, yet no one really knows the company yet.  CYTV shares are up threefold in the last few days and sit around $2.60 today.  This is the first Chinese online video site listed in the US and this is the description: CnBoo.com is the online video site of HuaJu NetMedia, the Joint Venture partner of China YouTV. CnBoo.com was established in May, 2005 as one of the earliest video sharing sites in China.  The online chat rooms are calling this one "the next YouTube, and in China too…"

The web site is a video viewing site and social networking site that allows users to create their own profiles, post videos, and comment on each other’s posts. It offers short-form videos that are predominantly user-generated or, in many cases, professionally produced videos that have been user "edited." Everyone can watch videos on CnBoo.com. People can see first-hand accounts of current events, find videos about their hobbies and interests, and discover the quirky and unusual.  The company claims that CnBoo.com already has more than 1.2 million members and over 1 million pieces of original video shorts.  So far it is being billed as the YouTube of China, sorry Google.

There is one question here that really needs to be addressed though, outside of the traditional OTC stock spin: How does this get around the Chinese censorship laws there?  There has to be some issue here, even if the company claims it "monitors" the content per Chinese laws.  The company’s website is also very basic and doesn’t exactly ooze "mega-video" AND this company in the joint venture was (partly) funded In MARCH 2007 with 2 deposits of 1 million RMB (about $130,000.00 at the time under today’s echange rates).  Access the registration from March here, and you can probably assume that there will be some share sales if there haven’t been already.

Investors need to know that this one has stock promoters behind it because the emails have been sent around en-masse in a template that many other OTC stocks get put in.  But hey, I don’t want to sound only negative on this sort of investment tool because sometimes letting the actual fundamentals get in the way of a great story is more costly than can be imagined.  I am sure the fact that all the chat rooms are calling it "the next YouTube, and in China too" is going to keep the buzz going regardless of if this is a $2.80 stock, a $4.00 stock, or a $0.50 stock.  After you have been around for a while, these all fit a boilerplate dujour and it is hard not to at least raise an eyebrow or two.  But, once again, sometimes putting the fundamentals and financials in front of a big story makes a huge missed opportunity.  That will be for you to decide.

Cytv_chart 

Jon C. Ogg
March 22, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: March 22, 2007 – 9:23 am in Internet, Micro Cap

IPO Alert: VeriChip Amended IPO Filing and Backdoor Plays

VeriChip has made an amended filing on its IPO process, and this now looks closer to fruition than it has previously.  The company will trade under the ticker "CHIP" on NASDAQ.  Underwriters on the prospectus are listed as Merriman Curhan Ford, C.E.Unterberg Towbin, and Kaufman Brothers.  The number of shares and pricing terms have not been set here.

If you have been following the story at all, as it is a cult stock status, VeriChip is what the street has been deeming as RFID for people and portable location-based assets mostly geared toward healthcare.  VeriChip just announced on Monday that it received the US patent for its portable RFID asset tracking system, so that may have been the last hurdle (or one of them) that the company has been waiting to finally come public.

As of November 2006, its RFID systems have been installed in over 4,000 healthcare locations, primarily located in North America.  The company believes it already has 50% facility penetration for infant tagging at birth facilities in the US.  It is also looking to its VeriMed system, the controversial human implantable microchip, as the next major avenue of growth after some key patents expire in April 2008; other products are VeriGuard and VeriTrace.  Its revenues for 2005 were $24.5 million (after acquisitions) and its net loss after taxes was $5.5 million; the 9-months ended 2006 saw revenues of $20.34 million and a net loss after taxes of $3.45 million.

Applied Digital (ADSX) has been one backdoor play on this IPO and now that looks to be coming closer to actually happening.  The company was formed in November 2001 and Applied (ADSX) owns 5.55+ million shares; IBM Credit Corp owns 410,889 shares in the company.  The other backdoor play here is actually Digital Angel (DOC-AMEX), which is the sole supplier of its implantable microchip that has been sourced from Raytheon (RTN).  The company has minimum purchase requirements on chip purchases or Digital Angel can sell to third parties: 2007 $875,000; 2008 $1.75M; 2009 $2.5M; 2010 $3.75M; 2011 & Beyond $3.75M.  Digital Angel is an old tied-company to Applied Digital as well, so this actual situation is deemed as a double backdoor play.

This has been in the hopper for some time, and this latest patent announced Monday might have been one of the last hurdles to an IPO.  Applied Digital (ADSX) is up 1% at $1.959 and has a market cap of $131 million.  Digital Angel (DOC) is also up 1% at $2.69 and has a market cap of $119.75 million.

If you would like to receive future emails regarding backdoor plays, special situation investing, IPO’s, and BAIT SHOP emails on buyout candidates then please send an email to jonogg@247wallst.com and label the subject as SUBSCRIBE.  We value privacy and do not share our distribution lists with any third parties.

Jon C. Ogg
January 9, 2007

Posted on: January 9, 2007 – 10:25 am in Biotech, IPOs, Micro Cap, Semiconductor