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   Strategies & Market TrendsValue Investing


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To: gcrispin who wrote (20912)4/5/2005 8:27:40 AM
From: gcrispin
   of 70901
 
Another interesting article about IMOS.

marketwatch.com

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To: Lazarus who wrote (20303)4/5/2005 9:05:39 AM
From: Suma
   of 70901
 
Lazarus:

Still watching your TCOW that you posted. If you have the luck of the Irish keep posting those babies and maybe some of us will make some $ is we buy..

Thanks for update .

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To: Paul Senior who wrote (21045)4/5/2005 10:27:10 AM
From: Dale Baker
   of 70901
 
What if I am a figment of my own imagination? That would be quite a conundrum.....

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To: Dale Baker who wrote (21051)4/5/2005 10:45:55 AM
From: Carl Worth
   of 70901
 
at least that would show you are creative, a good characteristic to have in these markets <g>

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To: Carl Worth who wrote (21052)4/5/2005 10:47:16 AM
From: Dale Baker
   of 70901
 
Hell, if reality equates to my imagination, that private island in the Caribbean is just one fantasy away. Outstanding!

LOL

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To: Paul Senior who wrote (21048)4/5/2005 11:25:25 AM
From: Brinks
   of 70901
 
Paul

I'm not talking about Graham value plays for selling 1/2 on doubles but high risk junior energy plays like Storm Cat, AOGI, TPE, etc. As you pointed out how can one determine a true value of Storm Cat at any point in time? You can't.

I have about seven of these now. It only makes sense to follow this program. Also at times you can later reload position should it come back down. If one owns a "free" position in a high risk situation you can be very relaxed about price flucuations. In fact, I find myself cheering for a decline so I can reload.

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From: James Perry4/5/2005 2:18:38 PM
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I can name 3 stocks that I think are well worth DD study by a value oriented group.
First is PowerCold (PWCL). To get a real feel for the company you need to read a lot of 10Ks filed in past years. They do air conditioning and for several years, bankruptcy seemed a certainty. Officers worked without pay, except options. Debts paid with stock. And several times, when things got too tight, the CEO and major shareholder would add enough money to keep it running just a little longer. And during that time they bought and merged with other little companies, to gain technology. They have put together a commercial cooling plant that just outclasses the competition, and in recent years have grown. My memory may err, but revenue has run on the order of 300k, 1.3MM, 3MM, 4.5MM (annual) and just announced for the current year, 9MM. This year they showed up with a large bad debt increase - a general contractor building a large hotel in which they provided a/c went belly up...most of that will be collected, ultimately, for the hotel is being operated. At this point they have a very efficient chiller (outstandly so) and use DuPont Caltrel plastic to make their coils and cooling fins. They control air quality by use of humidifiers, dehumidifiers, swamp coolers, etc and build a self contained unit with a tank to hold the liquid which keeps recirculating for cooling. Also uses generators as part of the unit to supply energy during the portion of the day when electric prices peak. Their customers include quite a few chains, such as Hilton Hotels, Applebees, Burger King, Eckerts drugs, etc. Stock is $1.70, and I believe 3 years will produce large growth.
Second - and some may disagree that this is a value stock - is FX Energy (FXEN). Has 1.8 million acres under lease in the Permiam Basin of Poland, with interest from 24.75 to 100%, but mostly 49%. Drilling for gas. Has just put down a second well which is flowing commercial quantities of gas, but holding development of the well to determine the extent of the gas field they have hit. A third well will soon be completed and step off to establish a boundary, and a 250KM 2d seismic study is being made of the underground ridge that acts as another boundary. Careful DD on this one will reveal lots of hints that this is a big find that has been made by this little company. I am told that CalEnergy is in the tier of companies owned by Warren Buffett. FXEN sold 1/2 their interest in 15,000 acres to CalEnergy for $10MM, and when a well there hit a commercial flow of gas, they seem to have bought the remainder of that well and 1/2 interest in about 25,000 more acres for enough MM to cover the cost of all the drilling FXEN is required to do to "pay for" the rights granted to them in a huge segment of land where all this is taking place.
Third: I like a company called Sometics (SMTS). They measure the oxygenation of the blood going to the brain during surgery in order that a doctor may be warned if for some reason the oxygen is reduced and the patient put at risk. That seems to me to likely become a "standard of care". They sell both the machines ($25000) and one time use pads ($100). Has 8 years of double digit revenue growth, most recently 40% growth, next year predicted 45% growth, after increasing product price 22% and decreasing manufacturing cost 40%. Has a p/e of 17. The market today finds biotech unexciting, and I think this stock will have to await excitement to reflect a value which is more reasonable.
I own each of these stocks.

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To: Brinks who wrote (21054)4/5/2005 2:36:23 PM
From: Paul Senior
   of 70901
 
Brinks: I'm more concerned with how much I can lose vs. how I might hold on to a gain. So my positions here are VERY small, and this helps me ride the volatility.

OTOH...

your logic is compelling, and from what I can tell, your record with these things is better than good.

Perhaps it's not position size at all that should influence or dictate decisions to avoid or make sells, but rather as you say, what is the best approach given our inability (or anybody's) to value these things at current price? Logic, perhaps probability, maybe experience, seems to indicate you are correct with your methodology.

I have to agree with your viewpoint. I've sold half of Storm Cat today.
--------
Regardless of how the stock performs from here, thanks for sharing your opinion - I'll call it a good suggestion.
I appreciate any help I can get - even though it's often hard for me to hear what's being said & act on it!

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To: James Perry who wrote (21055)4/5/2005 9:22:22 PM
From: gcrispin
   of 70901
 
SMTS certainly has an impressive growth record, but at nine times sales, it doesn't qualify as a value stock for me. Please correct me if I'm wrong, butI also think the 17 PE is a bit misleading as they will now start paying taxes in 2005.

However, I appreciate the time you spent outlining our choices and I have three that I have recently purchased and continue to think are values. There are two that I have mentioned on this board: ARDI and IMOS. I have also been buying NPTH, which is the market leader in venous introducers. This is a micro-cap that is fairly illiquid. They had a recent ruling by the FDA that will delay their new steroid-eluding epicardial lead, but this new product has been approved in Europe for one company. I also think that their proprietary advanced delivery catheters that will be targeted initially at the atrial fibrillation (“AF”) ablation and carotid stenting markets could be successful products. These are large markets that could substantially add to a company with expected sales of 32 million and a market cap of roughly 48 million.

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To: Paul Senior who wrote (21056)4/5/2005 9:52:37 PM
From: Brinks
   of 70901
 
Paul

I believe what the difference between you and I is as follows: I will take a relatively large position in Storm Cat (% wise to total portfolio) on ground level basis based upon some very extensive due diligence. At this point in time it is high risk. To reduce the risk in my portfolio to Storm Cat I will liquidate let's say one-half the position to recover my cost and ride the remaining "free" shares. I hope that the share price will decline so I will be able to decide whether to "reload" the Storm Cat position. What you are saying that your Storm Cat position is not that significant relative to your total portfolio. I understand therefore your reasoning then.

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