I think AWRCF is a poised to appreciate at least 50% in the next 60 days for the following major reasons:
--It has earned .27 per share for each of the past two Qs or an annualized $1.08 per share. This equates to a 5.4 PE at its current $5.80 share price.
--They will be announcing Q3 earnings on or about November 15th prior to presenting at the Breen Murray conference that week. I expect Q3 earnings to rise to at least .30 per share because 1)the economies in China, Thailand, Singapore and Australia are all growing briskly 2)their currencies all appreciated against the US dollar in Q3 by as much as 10% 3)the spot copper price appreciated 25% during Q3 so their copper inventory will be marked up.
--AWRCF owns 51% of Charoong Thai which is publicly traded on the Thailand Stock Exchange (symbol CTW). CTW has been trading up on high volume recently in anticipation of strong Q3 earnings. At the current 8.65 baht share price, AWRCF's 51% position has a market cap of $59 million or $4.23 per AWRCF share. That is 73% of AWRCF's current $5.80 share price even though, for the first six months of 2010, Charoong only accounted for 38% of AWRCF's sales. At its current share price, Charoong trades slightly over a 7 PE based on first six months of 2010 annualized so its current share price isn't high especially if it reports rising Q3 earnings.
--AWRCF's consolidated book value per share at 6/30/10 was $9.62. If you add minority interests which can't be consolidated, the book value is $14.09. I don't know how much credit the market gives to the book value of minority interests that can't be consolidated, but it's real value and is worth something.
--AWRCF has disclosed in its filings its intention to uplist on a higher exchange (probably the AMEX). Michael Dell owns 10% of the shares subject to a SH's agreement which gives him the right to put his shares back if the uplisting isn't completed by February 2011. There is a real incentive to get this done soon and almost certainly by the end of December. I'm hoping and wondering whether they might announce it in mid November along with earnings leading into the Murray Breen conference and other roadshow meetings. That uplisting coupled with strong earnings should give the stock a powerful boost especially if the broader market environment continues to be conducive. Positive developments often fall on deaf ears in a crappy market.
-- As I have been a shareholder since 2003, I have known and met with the CEO over the last five years and more recently with the CFO who joined last year. I believe they are capable and honest are working effectively to boost operating performance and increase the share price. They have hired a PR firm, enhanced the frequency and quality of their SH communication and attended more conferences and roadshow meetings.Also, Ernst and Young are their auditors which is a good thing.
--AWRCF is 75% owned by Pacific Electric Wire (PEWC) which was one of the oldest companies listed on the Taiwan Stock exchange and manufactures wire and cable in Taiwan. Essentially,about 10 years ago PEWC was over levered and looted by prior management. As a consequence, today PEWC is controlled by a group of Taiwanese banks who lent to it and got burned. It's also delisted and trades off market essentially as a penny stock. While its operations in Taiwan continue, its 75% interest in AWRCF is its "crown jewel" and source of future value growth. When AWRCF trades closer to its $10 book value, I think there is real potential for a reverse merger which refinances the bank debt, consolidates PEWC's operations into AWRCF and leaves AWRCF as the parent and public market face. If they could pull this off I think the stock could become worth $20+ per share.
naga-------New poster and have established a small position today and will add on any dips IF I can round up spare cash before next qtr.. Read your posts on AXAS board where I also have a position, checked out this stock and here I be. Really like the fact that auditors are U.S.. In fact it was driving factor in determining that bal. sheet was legit. This particular auditor can not afford a hit on their reputation which would also extend to their bottom line and loss of other business IMO. Woulda, coulda , shoulda if I had known in 09. It is still a Chinese co. so only powerball funds invested until my comfort level increases. Thanks naga and glta.
another thing on why I think you guys are very brave. this stock is not liquid now (and has been like this the past 5-6 years) and to unload 30,000 or more shares will take a long time or also with a big gap between bid and ask.
but I did get tempted to add everytime it dropped below $1.6 and end up adding more and more throughout these years (knowing that I might never be able to sell this stock again at the price I bought due to the hige bid ask spread), and think about the long terms and owning asset vs owning paper, so maybe this will be one of the time patience and long term mind set will paid off.
But I can share (from my experience) that this is not easy and need a lot of patience and independent mind (not just blindly following the crowd/market).
nice post.. which reminded me why I bought this stock at the first place (been here since 2003/2004 as well)
can't wait till awrcf finally to go to amex or nasdaq and provide quarterly update (and hopefully the stock would go to $7+ as you also predicted. still can't believe that this stock was at $1-$2 range for a very long time).
stanu they have providing investors with quarterly report during all of 2010- the next report comes out within 2 weeks, the are also doing a dog and pony show, the earnings should be better than the second with increasing rev- just look at charoong thai wire-- making new highs almost daily and we own 51% of charoong. This stock remains the cheapest stock in my portfolio regardless of the current price- cash +restricted cash almost equals $5.00, bk value is $10 + $4 minority, the never print paper- there have been 13.8 million shares forever- i rode this stock from 1 to 7 took some profit -bought it back in 09 @ .875 and have been adding- even bought additional @ $5-- buyout potential, institutional interest will happen when it lists, div is possible from conversation with management, - worth 10-15 dollars today! Huge growth from Asia-- One of my favorite stocks that with a little more patience the big dollars will be made- sitting on around 30k shares