Fri, Jul 25, 2014, 8:26 AM EDT - U.S. Markets open in 1 hr 4 mins

Recent

% | $
Click the to save as a favorite.

BlackBerry Limited Message Board

  • affye854 affye854 Jan 20, 2014 3:46 AM Flag

    Ready to Explode Early this Week

    Agria (GRO) saw big accumulation begin Friday and is ready to explode. It owns a controlling stake in PGG Wrightson (PGW), New Zealand's largest agricultural services company. New Zealand is the world's fastest growing developed economy with 3Q GDP growth of 3.5% and projected 4Q GDP growth of 3.71% - due to its booming agriculture sector, which saw output grow 17% in the 3Q. New Zealand's exports to China of dairy and lamb/sheep meat products are up 80% this year and GRO will benefit more than any other U.S. traded stock.

    GRO's 80.81% owned Agria Asia subsidiary owns 379.1mm PGW shares or 50.22% of the company, which trades overseas on the NZX for $0.43 per share. Agria Asia's shares are currently worth NZD$163mm or USD$134.5mm, valuing GRO's 80.81% stake at USD$108.7mm. With 55.38mm shares outstanding, GRO's stake is already worth $1.96 per share.

    Exactly two weeks ago, GRO hit a new 52-week high of $1.77 and PGW at the time was $0.40 valuing GRO's stake at $1.83. GRO came within $0.06 of the value of its PGW stake, therefore, look for GRO to explode to a new 52-week high of $1.90 early this week.

    GRO's chart shows that it's in the most solid uptrend in the market, consistently bottoming at higher lows before exploding to new 52-week highs on strong volume. With PGW's fiscal 2014 first half earnings due to be released February 25th and their EPS this year likely to rise 100%, GRO could break $2 this week. Look for GRO to explode when it breaks $1.77.

    GRO also owns 100% of a China seeds biz with last year's revenues up 98% to $17mm. Its closest comparison Origin Agritech (SEED) gained 19% on Friday to $2.40 and currently has an enterprise value of 1.04X sales - despite their seed revs down 8%. If GRO's China seeds biz with 98% rev growth was worth a mere 1.04X sales to match SEED, GRO deserves to trade $0.32 per share above $1.96 or for $2.28 per share.

    We have so far purchased 550,000 GRO shares and don't intend to sell until GRO is trading at a fair value.

 
BBRY
10.38-0.05(-0.48%)Jul 24 4:00 PMEDT

Trending Tickers

i
Trending Tickers features significant U.S. stocks showing the most dramatic increase in user interest in Yahoo Finance in the previous hour over historic norms. The list is limited to those equities which trade at least 100,000 shares on an average day and have a market cap of more than $300 million.