Thanks for the plug.
Here is how I wish TOMmy would have performed today;
China Prosperity International Holdings (CPIH) 45 5/8 +34 9/16: The land rush is on! With the ink barely dry on the trade
agreement document between the US and China, investors continue to buy anything related with China. The buying
interest is so heavy that little known companies with little history and certainly, limited revenues, are being scooped up by
investors. Even building and construction companies based in Hong Kong have caught the eye of investors as this
provider of interior fit-outs services of existing and new buildings is attracting much attention this morning. While this
company deals primarily in the construction of commercial properties, it has recently signed agreements for a multimedia
broadband project in mainland China in which the company will take a stake in the project. In essence, the company is
becoming a supplier of high-speed Internet access over the Chinese telephone network. Such news is enough to cause
investors to trip over each other in order to secure a piece of what is virgin ground for the Internet. Mind you, prior to the
recent surge in price, the stock had traded between twenty-five cents and 3 1/4. Accordingly, CPIH's market cap has
skyrocketed from $18 million when the stock traded at 1 1/4 just a couple of days ago to over $650 million and rising.
Certainly, investors are betting on the upside potential for what could be a lucrative market. But even with the signed trade
agreement with China, how China operates and behaves, particularly its bureaucratic institutions, will require much
overhauling as even Hong Kong-based companies have had setbacks with Ministry of Information Industry owned
companies. But that's just a minor problem. The real question is how will the Chinese population afford PCs so that they
can access the Internet. While the Chinese public is better off today than twenty years ago, its annual income is still
third-world class. Maybe this is where free-PCs come into play. If we can give away the PCs, then everyone in China will
have access to the Internet and the problem will be solved. Of course, the expense will be borne by the Internet supplier in
exchange for signing an extended service contract. If so, maybe investors should also be hog-wild over PC stocks on the
news that they will too experience a significant spike in demand. Somehow, this is hard to believe. RN
IMHO TOMmy is still tremendously undervalued at these prices. Remember when TOMmy had EPS of .10 and the stock was $1. I'm sure TOMmy can repeat the earnings. It was the negative CHINA SYNDROME which held it back before. |
