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Lotus Pharmaceuticals, Inc. Message Board

  • sirola1 sirola1 Mar 9, 2010 2:07 AM Flag

    A great value here, what am i missing???

    This stock is trading at or below book value, revenues are growing as are earnings for the last 3 Q's, revenue per share is near price per share, i dont get why this stock isn't trading in the $3 to $4 range since last Q eps was $0.11 dilluted earnings and that wasw way back on Sept. 30

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    • time to fly ... :)

    • What is missing is that some investors are not too comfortable the low cash level. Cash is not enough to even cover current liabilities, not to mention about funding expansions. But the company is making more than enough money each year to cover current liability and some capital expenditure. But it will need much financing for future expansion. It already has 49,000,000 shares outstanding, that is a lot more than other micro caps. The failure rate for small biz is high. What helps reduce the chance of bankruptcy is the cash. So, that is what I think is missing. Note that I am not bashing, just answering your question. And that is the concern I have. As a result, I did not go all in. This stock is worth $2-3 without the Inner Mongolian project. In fact, I suspect that if they did not spend the money on that project and keep it on the balance sheet, this stock would now be trading $2 or higher. This is only because some investors feel better when they see more cash on hand. If the project is a success, pps will go through the roof. If it fails, the cash is wasted.

      • 2 Replies to ilovetoinvest888
      • I'm much more interested in looking at how much cash flow this company is generating from operations than how much cash it has sitting in a bank account, earning next to nothing.

        Last quarter alone, LTUS generated about $9 mil in positive cash flow from operations and in the last 12 months they have generated over $46 mil in operational CF. That is pretty amazing for a company that only has a mkt cap of about $73 mil. The CEO has lived up to all his promises so far and I expect him to continue to do so. This is stock remains very undervalued at current levels, IMO.

      • Thankx for pointing this out to me. I just looked at book value and considered everythig was hunky dorey. I failed to take a good look at the cash amount.

        Question: What is a typical cash amount for a company of this size? Do you analyze it on a percentage of total assests or liabliity?

 
LTUS.PK
0.01320.0000(0.00%)Oct 30 2:12 PMEDT