I think that the financials are ok and not fake. First, this company did an IPO and not a reverse merger. I did not find any red flags related to this company. The problem is, however, that the money of the IPO is now in China and investors do not have access to the assets of the company. Legal proceedings would be difficult if something goes wrong e.g. the company goes dark. Finally, it all depend on the integrity of management. I agree, the discount to book value or liquidation value is really incredibly high.
Yes, you are right about the $.80 dividend. My screener sometimes does weird stuff with reverse splits. But this does not change my cheapest stock on the market valuation. This just means the new lowest possible estimate of the cast should be around $.80. In other words, worst case you have a loss of -38% and best case you have a gain of 1600% again just on the cash alone. That is an amazing risk adjusted reward.
I think this is just a classic example of individual investors being irrational and scared. Also, the CEO owns over 50% of the shares outstanding!
Sentiment: Strong Buy
Dividend was 20 cents before reverse split of 1:4. So dividend was $0.80 on the current share count.
By several metric this might be the cheapest stock in the world, literally. The stock is trading at $1.30-ish and the company has $22 in cash per share, with no debt.
Now I know what your thinking, " what if the cash is a lie" and I agree this is a concern.But lets take a reasonable guess at a low ball estimate of the cash per share. Last year this company payed out an extraordinary dividend of $2.40 per share in real cash . Lets say that management is insane and payed out half of the companies cash in one dividend, that still means they have $2.40 in cash per share!
So just to restate this in another the this stock has somewhere from an 85% to a %1600 upside based on the cash alone. This is all values the non-cash assets and on-running company operations at worth zero. So can someone explain to me why you people aren't devouring this thing?
I don't think there's going to be an earnings call until they hire somebody who speaks English. I don't know how they are getting all these regulatory filings done. Maybe they have Chinese legal counsel who acts as liaison with US legal counsel.
This acquisition was officially announced in China on 6/22. They need to file 6-K and issue a press release as soon as possible. Media coverage has been very favorable and it may be a brilliant idea. It sounds like a lot more than a $3mm deal so there must be some special reason for the shelf registration of such a small and precise amount.
Ya I saw that,, though I dont know how much the auditors will no about it as it happened after the last audit date. Thats a questions best left for the next earnings call. If you are running chrome copy the chinese text 左岸服饰 and look at the google news. Google should translate the pages once you open. Seems like there was a pretty big aquistion
Hi S. Healey, thanks for your generous offer of support. Suggest you get an understanding of why they feel they need to raise 3.5m in share offering, for "for working capital and for general corporate purposes, including the costs of operating our facilities in China, service on our indebtedness and possibly acquisitions or investments in other businesses, technologies or product candidates."
Please see below................
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
ZUOAN FASHION LIMITED
(Exact name of Registrant as specified in its charter)
(Translation of Registrant’s name into English)
Cayman Islands Not Applicable
(Jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number)
James Jinshan Hong, CEO
Building 1, Lane 618,
Dingyuan Road, Songjiang District,
Shanghai 201616, China
(Address and telephone number of Registrant’s principal executive offices)
CT Corporation System
111 Eighth Avenue 13th Floor
New York NY 10011
(Name, address and telephone number of agent for service)
Claudia J. McDowell, Esq.
MCDOWELL ODOM LLP
28494 Westinghouse Place Suite 305
Valencia CA 91355
Approximate Date of Commencement of Proposed Sale of the Securities to the Public:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. #$%$
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, please check the following box. X
If this Form is filed to register additional securities for an offering pursuant to Rule 462(
I am going to have a phone call with GHP Horwarth and just inquiry about their audit proccess. I had a call last year and they verfied that they physically go to the banks in china and get the statements but I want to go a little more in depth. Are there any questions that you would like me to ask?
I am also considering traveling to China and going to the stores and headquarters with camera and recorder to see if everything checks out and would publish a lentghy report thereafter. Thing Muddy Water but hopefully the opposite.
Could be used for employee purchase plan.
Could be that ecommerce seller wants some equity to retain upside after ZA buys that business.
Could be that ZA will issue debt convertible into shares of the ecommerce business when it does an IPO in 2016-2017. If the IPO doesn't happen then it would convert into ZA.
They need to explain all this soon.
Nice to see that they are still filing.
They filed a form with the SEC that lets them issue 3.15 M more in shares which could validate the aquistion. But why fund that way when you have 200 M in cash
I think JH hinted at this in a conference call last year. Lots of coverage of this story in Chinese media.
ZA bought a startup that combines multi-level marketing with sales on social networking apps and intend to bring that company to US stock market. Should have a press release coming.