Since buying into this stock, I have done more research on CCTR. I have lost about $1700 on it in just a few days, and I'm getting out before I lose the rest. I recommend the same to others who have it.
Here is the fruit of my research:
1. The bait: According to the financial statements, the company is trading at a fraction of its net asset value, and a fraction of its earnings. Furthermore, its earnings have grown steadily and dramatically in the past three years. If this isn't a scam, then it's one of the greatest investments I've ever seen. So why am I getting out?
2. The number of shares outstanding rose over the past year from 1 million to 20 million shares. If this happened again, it would virtually wipe out the existing shareholders. It appears that it happened because NewMarket Technologies, which is the majority shareholder in China Crescent, converted its preferred stock to common.
3. I wrote to the investor relations departments at NewMarket and CCTR, asking whether further dilution could be expected in the future. I wrote on Thursday. Neither has responded. In the presentations on the CCTR web site, the dilution is mentioned, they just say "well, we have to raise capital to achieve our growth objectives," or something like that, and they make no attempt at all to assure investors that there won't be any more dilutions. If a company really believes its stock is undervalued by a factor of 6, it would be buying back its own shares, not issuing more shares and then trying to talk other people into buying them.
4. China Crescent has apparently changed its name at least three times. First it was called Intercell Corp (back in 1994), then Intercell International, then NewMarket China, and finally China Crescent. They have traded under at least three different ticker symbols. Why would they do this? To confuse people? To prevent investors from noticing the stock's overall performance over its lifetime?
5. CCTR has complicated and confusing relationships with other companies. In some documents, it seems that Intercell International *was* China Crescent, but other times it sounds like Intercell *owned* China Crescent. Similarly with NewMarket Technologies. In any case, China Crescent, itself now apparently owned by NewMarket Technologies, owns a company called Clipper Technologies, which in turn owns 75% of Clipper Huali. Why a $1 million microcap company needs to be owning companies that own other companies, I don't know. But I take Warren Buffett's advice: don't invest in anything you don't understand.
(to be continued)
This is a very good outline to the history. All downtrend. This stock is not going down to zero because if you look into the greenfield partners you will see where some of them have performed the reverse split many times. The "birds of a feather flock together" saying plays out here. After consorting with these other thieves, IMO, some new lessons were learned.
- Disconnect any growth from common shares.
- Dilute the hell out of it.
- Reverse split and say its for greater traction and an upgraded exchange.
- Change ticker to hide history from average investor.
- Continue to dilute and reverse split over and over like some of the greenfield partners.
Notice the NONEEDTOSUFFER and KEEPINVESTING and others connected with the company are staying away from this thread. JMHO.
I think Investor Relations has been shut down since it seems that nobody can get a hold of them or get any email from them.
Great post. Someone mentioned this stock over in the LLFH board so I thought I'd give it a look. This at least gave me a quick history of what company we might be dealing with here. This thread also needs a bump (buried in all the chatter) just in case any new guys come along and wants a little more info about the company... Again, really great post here. Appreciate it.
cctr is no scam
Mr. Verges is a 1988 graduate of the United States Military Academy. His studies at West Point centered on national security. Mr. Verges served with distinction as a U.S. Army Captain in a wide variety of important engagements to include research and development of counterterrorism communication technologies and practices. Mr. Verges' early career after the Army includes time in the Computer Sciences Research and Development Department of General Motors as well as experience teaching systems engineering methodology and programming to Electronic Data Systems ('EDS') employees from 1991 to 1995. Mr. Verges' first business start-up experience was at EDS in a new division concentrating on call center technology in financial institutions. Later in 1995, he added to his start-up experience at a $30 million technology services business with the responsibility to open a new geographic region with a Greenfield operation. Mr. Verges founded NewMarket Technology in 1997.
Someone made the connnection between NWMT, CCTR, and NUBL. He said one of the guys at the company, (I forget his name), has been doing reverse splits to keep the price up, or heavily diluting the shares, and that's it's not even illegal.
I'm thinking someone should blow the whistle at this point, to see what improprietaries there are, if any, at this point, because I own both NWMT and CCTR. I'm hoping to see some good growth on both. NWMT especially is way undervalued. Market cap of $7M, and doing $100M in sales, with decent profits!! What is wrong with this picture???? Management had something last week to get the marketplace to realize the stock price is too low.
Philip Verges is involved with NUBL, CCTR, NWMT, DFTS, and NLAI. There is a bunch of other junkie companies that he is on the BOD too.
He is doing the same thing with CCTR and NUBL as he did with DFTS and NLAI. Just a big hype machine while he dilutes the shares.
Nothing will be done. I don't think the SEC cares about stocks on the OTC and Pink Sheets. You can look at their past auditors and know that it doesn't smell right.
Please explain better to me. Putting aside obvious considerations about low corporate governance and so on, please explain: Are you suggesting that the income statement/balance sheet of CCTR is a fake? Are you suggesting that they did not sell USD 37 million in 2008 for instance? Are you suggesting they don't sell anything but stocks? No one here has ever contacted or visited the headquarters?
If I listened to every yo yo who has no clue as to what a scam is I would not have 4 Times my money in GFRE which was also classified a scam. This is an OB stock which does have to report... Not a pink slip!!!!!!!!!!!!!!!!!!!!!!
Good point Brianc I saw posts on the GFRE board similar to these calling the company a scam but I decided to hold shares at .40 and now have a great 450 percent profit with a company that had only 2 PE. I'm hoping this company will do the same when discovered.
A couple more observations.
1) Let's suppose I'm wrong, and the company is not all a scam. It remains an undisputed fact that they have diluted the shares 20:1 over a 1-year period, and they give no assurance whatever that they won't do it again. This means that shareholders before the dilution lost 95% of their value.
2) Let's compare CCTR to another company that I believe is really undervalued by the same amount that CCTR claims to be: BHO. This is what an underappreciated stock should look like:
a) It is very thinly traded, because people haven't discovered it yet.
b) The company is buying back its own shares, rather than issuing new ones. This is what you do when you think your stock is undervalued.
c) The company is not busy producing PR to try to convince you to buy the stock, telling you that it's going to double or go up 6-fold, etc. They probably don't even want you to buy it, because they're hoping to have the chance to buy more of it themselves.
(Disclosure: Long BHO. Out of CCTR.)
We must avoid generalizations. Last year shows clearly that scams are everywhere, in NYSE,NASDAQ too, not OTC only.
When you see a very undervalued microcap, you have to think why is so cheap.
I bought GFRE too at .20s (still hold it), but only after I confirmed that CHFI was selling its shares to this level and CHFI had done the same with other good stocks like UTVG.OB (now AMEX-listed UTA).
Another example is CDBT.OB. This stock was an "undiscovered" thinly traded stock, very volatile for these reasons. Bought it at 0.24, sold it at .50s (to buy more GFRE).
All CCTRs' shares are changing hands in less than a week. If one single weeks' investors hold their shares, then it could show its true value according to its SEC filings.
But, as it seems, very few believe to CCTR for the long term. Unfortunately the management seems to believe the same...
Otherwise for a stock not unknown, this undervaluation could stand for more than 2 weeks.