China TechFaith: We'll Consider Buybacks When We Have Free Cash Flow To Do So
Aptus Capital's John Romero pushed China Techfaith Wireless Comm. Tech. Ltd (NASDAQ: CNTF) back in December of last year to initiate a reverse stock split – and the company listened.
Shares of China TechFaith have gained around 30 percent since Romero began a dialogue with the company. The investor cited at the time an attractive balance sheet and suggested the company should now initiate a buyback program.
Related Link: EXCLUSIVE: Customer For Million China TechFaith Deal Was Nielsen Audio, New Document Shows
Romero told Benzinga that while speaking to the company, management confirmed its intent to buy back its stock. Management noted that while it will not buy back its stock immediately, it is committed to doing so when it generates a free cash flow. In addition, the company's CEO said he would buy back back-stock at the first open period.
A translator for Deyou Dong, China TechFaith's COO was also quoted as affirming management's commitment to buying back stock. In the meantime, the executive opened an account in March and will buy back stock personally at the next open window period.
Finally, Romero noted China TechFaith holds around $20 million in deposit and Romero believes the company's assets are worth at least $300 million. In addition, the company's mobile business is not losing money.
Shares of China TechFaith showed no trades early Wednesday morning and are higher by more than 12 percent since the start of 2016.
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