Maybe Francois will tell everyone about these dishonorable mentions;
financialweb.com
Thanks to the Stock Detective's vigilant readers and a bevy of stock promoters, we're
flush with tips about stocks that most people should think twice about before investing.
All them may not warrant full Stinky Stock status, although we're sure a few inevitably will
come from this list. Until they reach that benchmark, Stock Detective wants to warn
readers about stocks that should have you seeing "red." What sets them apart? Take
your pick: volatility, high volume, wild price swings, outrageous claims, a stack of
vacuous press releases, or maybe a share price that doesn't seem to add up from the
sum of the company's parts.
XNET is the latest company laying claim to China's allegedly
vast, untapped pool of Internet users. Xin Net and its subsidiaries say they will offer TV
set-top Internet access as well as online content.
Xin Net, based in Vancouver, B.C., says its operating arm in China, Xin Hai, has
licenses to provide Internet access in 10 major Chinese cities, which combined give the
company access to less than 10 percent of China's population.
Xin Net also is up against some well-heeled competition. Earlier this month, China.com
went public and raised $84 million, giving it probably the deepest pockets of all the
China ISP/Portal site wannabes. Xin Net's bankroll pales in comparison. According to
its initial filing with the SEC, the 10SB reveals a struggling company with very little cash
or commitments. After two years, Xin Net has a mere 25,000 Internet subscribers.
Hardly the stuff Internet empires are made of.
And, prior to a $5.5 million private placement, the company had only a trickle of revenue
from operations. And, although the 5.5 million-share offering brought in some
much-needed cash, in the long-term it could dilute current shareholders' holdings.
According to documents filed with the SEC, investors who bought into the private
placement at $1 per unit have dibs on two more shares of Xin Net stock at $2 and $5,
respectively.
One curious note on Xin Net's income statement is the inclusion of depreciation and
amortization - which typically shows up on the cash flow statement. Inclusion on the
income statement inflates Xin Net's bottom line by more than $45,000 through the third
quarter of 1998, and a similar amount for fiscal 1997.
<<Oh, did we mention that one of the investors in the private placement (120,000 shares)
apparently is one of ZiaSun's biggest fans and an investor in that company as well?>>
As always, tread lightly……………………. The Stock Detective |
