The market ems to think the $151M of PPE in the EMS business is worthless, or close. Could that business be sold? There's got to be some Chinese conglomerate eager to lose money in EMS. Trying to understand if that business is a total loss. And what is the option value? How big is the chance that NTE gets another big contract?
Great questions. You've pretty much nailed it on the head. I will tell you how NTE can turn it's fortunes around:
1) Partner with companies other than JDI/Apple or Sharp/Apple. It would be great to see the company diversify away from the Japanese conglomerates. It's a tall order, but it would be a step in the right direction for the company.
2) Think about verticle integration instead of being component/module supplier: Think about being closer to the end consumer that be a conduit through JDI/Sharp to Apple or someone else. The growth in phones and tablets is there, especially in China. Again, a strategic partnership/joint venture could speed this along.
3) Develop the land in the meantime: No one is disputing the intrinsic value of the land in Qianhai Bay Economic Zone. The plan looks good. It just can't be the only plan for the company.
4) Bring in new people to the the Board of Directors. Make it independent. It will make the company better: I like the fact that Mr. Koo and Mr. Kellogg are on the board as they are large shareholders, and Mr. Koo has considerable experience. However, there needs to be fresh blood on this Board, preferably younger executives in complimentary businesses. The Board has not changed and it is stagnant in my opinion.