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Xinyuan Real Estate Co., Ltd. Message Board

  • lizhang200 lizhang200 Nov 15, 2012 1:16 AM Flag

    Blue Ridge is out. Will it make a difference now?

    1. As of November 14th, according to the website, the ball and chain weighing down every price movement during the past three months is now gone. Blue Ridge has sold all of its 11,000,000 or so shares of XIN, which means one very large source of downward price pressure has been eliminated. With this negative influence gone, will the company buybacks and institutional buying over the next few months be sufficient to overcome the effects of the recent "bad" quarterly report and the company's warning of a few slow months and non-inspiring quarterly reports up ahead? If anyone has new information that sheds light on this question, please share.

    2. It's interesting to note that we all called Blue Ridge stupid for selling XIN, but in retrospect it looks like it was a pretty astute move. A lot of BR's selling occurred while there was upward pressure on the stock price, and BR finished selling around the time that "bad" news caused the price to tank. With their superior information and connections, I wonder to what extent BR foresaw this sequence of events. At the same time, the price has failed to appreciate too much, allowing Xinyuan to continue purchasing shares on the cheap. In short, it's a win for BR, a win for XIN, and nice kick in the face for all those shareholders who were hoping that this was the beginning of The Big Move Up. Hopefully, BR's absence from the scene, XIN's buybacks, increased institutional buying, and a potentially warming Chinese economy will enable the stock price to increase over the next few months, but at this point I personally don't have any strong intuition as to what the stock will do in the near future.

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