i've gone thru their Q3 (ended March) SEC filing, and just to clear up some confusion on these boards which is leading to incorrect price forecasting:
1) Shares outstanding are 3.1M (roughly). 1.2M offered in the IPO is the public float. About 1.6M in insider holdings gets you to 2.8M, and then they have about 0.2M in outstanding stock options, and finally about 150K worth of stock given to the underwriter exerciseable at the IPO price.
2) Given 3.1M shares outstanding, market cap IS NOT $26M or $27M being shown on Yahoo--they are reporting data from prior to the IPO, when the stock only had 1.8M shares outstanding. The correct market cap assuming the stock at $15/share, is around $46M or so. Revenues in the first 9 months of SINO's fiscal 2008 year are $11.5Mish, and obviously add another $5M or so for Q4 and you'll get revenue in the $17Mish range for FY2008 (ending June)--likely to be reported sometime in early August.
3) The catalyst you may ask: well, they had a clean balance sheet prior to the IPO (about a million bucks in cash, and no debt), and now they'll get about $8.5M from the IPO (after costs) which gives them more than ample liquidity to expand their shipping logistics presence on China's east coast. I would suspect given their revenue growth rate of 50%+, that you'll see revenue of at least $25M for FY2009 (ending June '09) and probably EPS around $0.50 or $0.75 or so per share.
you gotta remember, the IPO has diluted the EPS....because TTM EPS was around $0.60/share, but that was calculated on 1.8M shares outstanding, obviously with the higher share count, they'll have to report a larger increase in earnings in '09 just to repeat the $0.60/share figure from last year. I'm already assuming FY'08 (ending June in 4 weeks from now) will show earnings of only $0.20 or $0.30/share, given the Q3 loss that was reported in the recent SEC filing in mid May.
Bottom-line; given the sector it trades in, a Price/sales multiple of not even 2X next year's (FY'09) sales, and a clean balance sheet with pretty drastic growth prospects (albeit a lotta risk, but hey, it's a micro-cap), stock is not expensive here, but not cheaper either.
Anyone holding for $27 again or something, you'll have to wait a long long time for that to happen, but anyone waiting for under $10 to buy--don't count on it!
1.2M share float, and the average volume has been nearly a 1M shares a day since the IPO, you can obviously tell daytraders luv this stock, and i'm sure some hedge funds have engaged in naked shorting of the shares....but at $14 or $15 where it's trading right now, there ain't much downside, and not much point in someone or some hedge fund starting a new short position, therefore, we should base out here, and i'm sure one of these days when the markets are up, the shipping sector is up, and chinese stocks are up in general, you'll see SINO have a 1M+ share volume day and probably re-test the $17-18 level, but $20-22 would need a volume day like we had that first week (3M+ shares that one day on the $27 morning high).
so if your average cost base is in the teens, then you'll be fine; just be patient. if your cost is above $20, i'd suggest either find money to average-down or sell now for the loss and use that loss for tax purposes to offset other gains.
and for those JUST BEGINNING TO SHORT this stock here at $14 or $15, all i gotta say is your timing is off and your risk/reward at this stage is poor. shorting that day when it gapped up north of $25 was prudent, and shorting when it failed to hold $20 was prudent, but down here, just makes no sense.
good luck everyone!
(disclosure: long 5,000 shares; and i've been long as many as 20,000 shares that first week when i doubled my money on this stock at that point)
Hey great post...
I am not the big investor like you. but i am holding 1000 Shares@$22.5...
To me this baby is giving me huge loss...what's ur advice should I be long or should digest loss and move ahead???
Any help would be appreciated...
my advice is that you average-down. your $22 cost base is much too high.
if you can average-down here in the $12-13 range, perhaps 500 shares or 1000 shares, you'll do alright longer-term.
downside is likely limited to another buck or two from here.
upside on a good volume day (i mean 1M+ shares) is likely to the $17 range, longer-term, to see $20, you'll have to wait until Q4'07 earnings, which will likely be released sometime in August or early September.
Awesome post... Dare I say THE Quintessential SINO post
thanks for taking the time to lay out some details. I was confused on the float, but recently figured out where I was wrong there.
I agree with the no debt semi-clean balance sheet comments. And the IPO funds providing capital for expansion etc...
basically there will be some ups and downs with SINO. Hard to call the bottom but I think we're pretty close.