One to consider buying for a long slow play that ought to peak by March 24th
PLDPY 4-3/8
This is an Australian company that lists on NASDAQ with ADR shares. Weak earnings and other woes have driven it down for awhile. View 12-month chart:
quicken.com
<A HREF="http://www.quicken.com/investments/charts/?symbol=PDLPY&period=1YEAR&charttype=HIST&othersymbols=&mavg=NONE
">AOL users click here</A>
Its latest earnings report on 2/9 was obviously anticipated, as the chart shows a decline from Jan 18th (5-5/8?) to the 9th (4-3/4), then the report dropped it to about 4-1/16. View 3-month chart:
quicken.com
<A HREF="http://www.quicken.com/investments/charts/?symbol=PDLPY&period=3MONTH&charttype=HIST&othersymbols=&mavg=NONE
">AOL users click here</A>
Now, it ran up a hair since, but I expect it will settle back to 4 in the next 2 days. Today it had news of an American venture capital corp buying a large stake in it, and I betcha I know why.
Often large companies (this has a cap of $1.14 billion) with multiple holdings cannot get full value from those holdings unless they spin off segments into new companies that IPO. An excellent example is COMS spinoff of PALM, which debuts next week.
Look at what COMS did:
quicken.com
<A HREF="http://www.quicken.com/investments/charts/?symbol=coms">AOL users click here</A>
About 45-77 in 4 weeks.... and I would not be surprised to see it hit 90 for a perfect double in the next 2 days. I can predict COMS will drop next week, after PALM debuts.
Now I'm not saying PLDPY will double to 8. But 6 seems certain (50%) and 7 or 8 is not out of the question.
Because looky what happens on the week of March 27th:
hoovers.com
That's $738 million in sales, net profits of $52 million, and AFTER the IPO, PLDPY will still own 80%.
Based on all recent IPOs, the new company will instantly have a market cap of at least $1 billion and 80% of that means PLDPY's holdings will make it worth 70% more than it's worth today.
With Merrill Lynch & JP Morgan as 2 of the lead UWs (underwriters), 2 of the 4 best UWs going, you can bank on my valuations being conservative.
Thus, it's easy to predict a 50% increase in a month, and 70% to 100% is not outa the question.
Certainly, this is no daytrader momo play. The rise will be slow but certain. However, for those who tire of the daily momentum trades, you could certainly put $10K or $50K here, walk away and come back to sell it on the 24th or early on the 27th, and be happy with the results.
I've said it often; if you can increase your entire holdings 50% per month, you will make huge money in 6 months time, due to compounding. (About 600%).
Thus, if you want a long slow gainer, I recommend you buy this either Friday or Monday, ESPECIALLY if it dips down further.
That VC company knew EXACTLY what it was doing!
Feel free to ask an offline broker if my estimates are correct.
Now, considering what the new spinoff, AHK, manufactures, I'll bet you never thought latex could provide such a good feeling! (ROFLMAO !)
Kevin H. |
