it won't go anywhere as long as they are in risk of losing a large part of their cash balance in an ill-fated investment loan...
no - one third of the company's cash balance is seemingly stuck in an overdue real estate development loan with the very real possibility of losing the money entirely.
if you want to spread fear among investors look no further than at the huge overdue investment loan. Would love to know if any of the company's officers are involved into the project.
EACH AND EVERY quarterly report is unaudited as regular audits are only performed on annual numbers. There's no difference between IBM and JRJC in this case.
In a small note on the earnings release, the company mentioned it had an loan to a Hebei real estate developer on its balance sheet, valued at about 10.2 million USD. Management expects to be fully paid back by Q4; however, the transaction warrants attention. Not only is the loan decidedly non-core, the collateral (the developer's listed equity) isn't exactly secure (in a worst-case scenario, the collateral could be worth much less than the loan value). Additionally, the borrower is clearly having liquidity issues (interest is accruing, not being paid periodically in a more typical principal + interest payment). The loan amount is noteworthy (about 10% of total assets), and investors uncomfortable with the exposure should scrutinize the Q3 balance sheet closely.
given these issues I wouldn't touch the shares at all as the Q3 earnings call will reveal the mess in detail. This will be at $10 at that time or even below that and I really don't know how much lower the stock might move after the call. One of the best shorts in the market today.
just look up the history here - I covered at $2.50 for a GIANT gain. And now I am short again.
in a recent presentation the company unexpectedly disclosed poor demand and heavy margin pressure which hasn't changed until today. Q3 will come in somewhat weaker than expected but Q4 and Q1 will be a total mess.
covered 50% of the short here but holding remaining position for the possibility of $6.50 later today
nobody cares about past earnings - with current margin issues the Q4 eps might come in around $0.15 or less with more worries expected in Q1. Valuation looks high based on these metrics.
dELiA*s, Inc. (NASDAQ:DLIA), an omni-channel retail company primarily marketing to teenage girls, today announced that the Company has received several inquiries from third parties regarding a potential acquisition of the Company. In response, the Company’s Board of Directors has determined it appropriate to explore and evaluate strategic alternatives to enhance stockholder value, including a possible sale, merger, or other form of business combination. As part of this process, the Company may also consider debt or equity financing alternatives. The Company has retained Janney Montgomery Scott LLC as its financial advisor, and Honigman Miller Schwartz and Cohn LLP as its legal advisor.
sure - but what is the equity of a bankrupt property developer worth - it would be much more comforting if the loan was secured by the property itself
given the current state of the Chinese real estate market. This loan was due for repayment in September but obviously the debtor was unable to repay neither the loan NOR pay even the interest at this time. So I am looking forward how this will play out.
actually revenues have been declining by $3 mln for a second quarter in a row which does not bode well for the share price tomorrow
to be fair I would be already able to pocket thousands of dollars just an hour after the short sale but I am willing to bet on an even deeper move tomorrow.
Given the current margin issues there's simply no need for investors to own the stock here as expectations for Q4 will need to be greatly reset once the magnitude of the disaster becomes clear when PEIX reports Q3 results. Would expect this to move down to $10 BEFORE the Q3 earnings release.
as said before here the results are rather disappointing as revenues are down ANOTHER $3 mln qoq which clearly isn't what investors expected. Unless the conference call has some really good news the shares will have a tough day tomorrow. I am short here after hours.