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LJ International, AŞ Message Board

  • darkcloud1945 darkcloud1945 Mar 15, 2013 4:36 AM Flag

    Maybe...a bad quarter?

    It could be that the Q3 was off...slower growth, heightened expenses. A leak? Then again this could be a move to shake out more of the weak hands. It appears we have two camps posting on this board...those that believe growth will provide higher eps (and trust the financial strenght of Jade)...and those that believe the management is pulling another scam to suck in the envy.

    Even with a bad quarter, if there is one, I'm looking hard at the revenue growth and store count before I jump ship. $1.84 is attractive to me...that's half the book value! And I have to believe that the inventory (reported at the lower of cost or market) is undervalued on the balance sheet.

    HOLD and selective BUYs

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    • The Form 6-K and the PRNewswire is public...Jade continued to show a 15% sales gain and added a net 49 stores in 2012. The bad news is a slowing rate of growth in the same stores. Yih's remarks, I interpret as saying, is that Jade will continue to expand their store network and branding advertising. The other bad news is that gross margins have dropped because the lower price lines ENZO has introduced to capture share of market has lowered the overall gross margin.

      The "book value" at year-end dropped from $3.88 to $3.23---$.65. The drop was primarily due to the deemed dividend---$.37 per share.

      An optimist would say that the losses are " an investment" in the future...That a sustained 15% growth rate in retail revenue will defray much of the fixed costs of this expansion.

      It will be interesting to see what the Institutions do...

      Sentiment: Hold

      • 1 Reply to darkcloud1945
      • In spite of the weaker earnings, it appears the institutions are holding fast.... Volume was moderate and the pps recovered from the dip. No doubt the leprechaun factor! If Monday-Tuesday hold, the pps on moderate volume, I would take that to indicate buying strenght at $1.86-$1.93 and a possible move back to $1.98-$2.01.

        It's hard to keep a good stock down---this management is talented---there is opportunity in China's economy---patience will be rewarded---the DD will be overcome IMO.

        Staying LONGGG

        Sentiment: Hold