I agree-but NCTY will trade at 50% discount to its true value because:
1, funds do not like this sector because its boom-bust cycle based on games and pipeline. NCTY is a pefect example of this as it had huge hit , made a fortune-stock was over 20$ but then imploded for years-losing a ton of money because of huge problems in their pipeline and that how you got 3$ stock.
2, NCTY again does have huge pipeline of new games and has a bad track record of releasing things on time.
3, NCTY is the worst PR company in the world- only release EPS every six months in which no company does that and basicly are not shareholder friendly.
The position is the CEO at one point could have sold the company for 20$ or for him thats about 200mill value and he blew it and his stake when to about 30million after the implosion. Is that dumb to repeat it again
4, Its holding company will assets that are partnered with rich companies- they own 40% of funbox and 70% of firefall. in the USA SMALL companies get rich by SELLING their companies to the big boys. China boys have not figured this out. I believe he could sell firefall , funbox, real estate, qunar, small games ect for ia for 250-300million in the next 6 months which is around 10-15$.
1. From value point of view, NCTY is extremely under valued. For instance, the office building that NCTY bought alone is worth $45m-$55m while on NCTY's book, it just shows purchasi price even though the real estate price in Shangshai has increased several 100 percent during those years.. By selling a couple of unattractive games NCTY may get $30m cash.
2. Firefall will a very successful game. NCTY will have another popular game on the Chinese market this year.
3. Funbax sales has been doing very well in China. NCTY owes 40% of the company; the Chairman owes another 10+%. Funbox also becomes a game platform.
4. The Chairman and founder has been focusing NCTY operations now
5. Weak hands have sold NCTY out. When new funds comes back, there will be a lot of buying poer.
6. NCTY's float is small. The stock an easily jump even a small fund starts buying;
7. Existing funds will not sell NCTY as they bought NCTY at much higher price. AND NCTY's fundamental has been improving;
8. Once analysts starts to cover NCTY again, NCTY will have very strong upside momentum as the company has been getting better and better.
9. Chinese economy is getting better, there are a lot of internet game players
10. Upside price momentum will attract more buyers for NCTY stocks, and company's better performance will fuel the upside momentum for at least a couple of years as Firefall will be a very good game. When NCTY was basically one licensed game company, the stock went to $47 a share. Firefall is developed in house, there will be no license fee.
Good luck, LONGs. Buy NCTY and hold!
I could see that... Don't think Jun Zhu will take anything less than $10. But, he should hold out for $20+
You don't need to worry about Q1 and Q2 2014. Q1 was profitable due to one time gain of around $20 million USD. Q2 should see a big jump in revenue due to Funbox sale and should show loss, although the loss will be reduced dramatically.
They were in talks too sell 2 games for 30million? Plus hopefully they could large amount of cash upfront for any licensing deals
Most of this cash burn is due to the game launches. Expect a sharp decrease in cash burn and return to profitability in the 2nd half of 2014. I am a bit nervous about the q1 and q2 numbers for 2014 but, the ZTE9 fun box sales will help offset much of the burn for the beginning of 2014. Given that the company has not had to issue debt or issue more shares so far this year is a good sign that they have enough cash to get them through the game launch. Also, keep in mind the9 raised tons of cash selling 20% of Red5 to oriental pearl so, I wouldn't be too worried about that for now.
NCTY Warning: cash burning rate is scary!
I don't know if there is any good news coming or not but with this kind of cash burning rate, it looks like this stock - NCTY is going to zero in not far future and nothing would be left for shareholders.
I think this rise is pure speculation that the company is going to turn around with Firefall or other games.
But I don't see solid prove of it.
I just play the new Firefall, It is amazingly good, far far better than the beta version. It is going to be a hit, I think......
There should be a stream of kicensing deals coming after commercial launch on July 29. It is hard to sepculate when and the deal size at this stage. This is truely a AAA game, rare for such a small company as NCTY owning a majority stake in a triple A game. Next 2 years should show how successfull it will be, but I like its chance.
New version of Firefall was available to download last night, 4 times of the area and 15 times of content of the Firefall beta version. Open world PvP and new missions available, but open world PvP only available for players reaching full level.
It is super cool, much much better than the beta version. Cannot wait to play it.