CHLN announced go prviate deal this morning with $1.75 per share. The funny thing is the stock was closed at $1.71 last Friday, implying a mere 2.3% premium. If the same theory applies, XIN may go private $3.70. Anyone who bought it above the price will be permanently under water. Remember, the chairman controls the company, small investors have no say to block the hard ball offer.
Buyers need to be aware that these companies show no sympathy to small investors. If you buy it to dream it go up to half of its book value per share, your dream may never come true.
Thanks for the reply. That helps answer the dilution. Still, the buybacks have minimal impact even without the TPG investment.
Yes. They are growing the top line, but the bottom line decreased by 68%. This is something I expected long time old. When people screamed about how low its P/E is, I said it is normal for a company that will see its EPS drops substantially in the future. I used to feel XIN's fair value is $5. Now, given the declining RE climate in China, I have to lower the fair value estimate.
Again, I no longer follow this company that closely. So, I have no exact target number now. I guess the current price already reflects its fair value. XIN will fluctuate depending on the prospect of China's RE climate. For now, it does not look good. it is the first time in the last 15 years that the market cools down without government's interference.
Now, we know the buybacks are just gimmick. Today's earnings release showed the diluted ADS jumped by 26% year over year to 90.8 million from 72.2 million. This may be old news since its end of 2013 number already 90 million. At least, we know the buybacks are used just to issue even more shares.
PS: I have not come back for a while. This morning, the XIN earnings release pupped on my SA screen. Then I read it. Terrible. I am glad I got out last year. Dishonest management. All the efforts they put is to grab more money from shareholders. Do the math. Their capital distribution is not even near the pace of share dilution.
Are you even able to read? I have nothing to do with Bill Ackman. Now, I understand why you have to listen to CNBC to learn. You cannot read.
Leo, what do you think? How can XIN be more suspicious after one and another news? Every single news points that XIN may have a cash hole. I am glad that I were out. Otherwise, I will sell now before the actual offering is announced.
I don't know if I read this correctly. It looks XIN is proposing another debt offering, and Fitch just rated it at B+. What the heck is XIN needing cash so badly? They already did a debt offering and a TPG offering this year.
It doesn't matter star. Nobody should doubt XIN has a legitimate money making business. It sold properties almost everyday. However, the real cash, revenue and earnings are just not as much as in XIN's financials.
Yes, I sold all my XIN after the TPG investments. Star, you have to be honest to yourself. Are all these events added together suspicious? True, there is still a slight chance XIN is innocent, but do you want to take that risk?
CFO quitting alone may not be an issue. However, combined with the expensive bond offering, TPG investment and the slow stock buybacks, there is highly likely a problem. Why the hack does XIN need that much cash when its balance sheet shows it already has a ton?
XIN's accounting fraud risk is higher and higher while the Chinese real estate risk is higher as well. Blindly buying XIN based on the previous technical pattern is stupid.
I remember a guy here bought XIN at $5.5 and thought he once again bought on dip. Now, he may be crying in a corner.
Good decision, Macrino. XIN has been consistently below P/E of 3. The market typically is not stupid after a whole 3 year period. Also, as you said, all signed are pointing that XIN has a lot of accounting going on. Blindly ignoring all these warning signs is not wise. I want to sleep well.
You are also right. Chinese real estate stocks are not the best investment among all other Chinese stocks. They will go up and down based on policy perceptions, but they do not have long-term investing value.
Marcino, I remember you were a big XIN bull. What changes your mind? I got out of XIN because I do not want to associate with any stocks with accounting fraud risk.
XIN does not have that much cash to buy back stocks quickly. Don't trust their cash balance on the quarterly balance sheet.
Just be aware. The good days for US listed Chinese developers may be gone. CHLN drooped almost 40% after the earning release. Can't imagine how XIN could navigator the industry decline.
All I have to say is you have pretty big ego. You may always feel you are right but everyone else is wrong. Only yourself know whether you deserve that big ego. I hope you are really that intelligent. Otherwise, you will not have very decent investment return over the long run.
Hey, you didn't read properly. The poster was saying he used to trust the company 100%. Look, investing is never static. A 100% trustworthy company can be suspicious later after a given event.
It is like you trust your fiance when you married her, but you no longer trust her 100% after she cheated you once. Don't tell me you would continue trust her 100% after the cheating.