> It has been touted by Lawrence Roulston in the past. Here is there website.
Ray, this one used to be Pacific Minerals, right? I bought it when it was in a similar slump in 2003 and sold out when it more than doubled, only to watch it more than double again. My take on companies like this is that promotion is one of the most significant dimensions to watch. Roulston recommends a stock like this strongly, it rises as a result, then it runs out of demand after Roulston subscribers buy all they are going to buy. Roulston moves on to other stocks, subscriber money moves with him, and the share prices enter a self-perpetuating downward trend until the stock starts to get relatively cheap. We saw big gains in several H-D companies like Anooraq and Northern Dynasty when multiple promoters were paid in shares and cheap warrants to cover them. The promotion helped them get favourable financings and allowed them to advance the properties a lot, increasing the value that way, but I think that the promotion could only take them so far and shares had an inevitable drop-off when they failed to make it to the takeover level (although Anooraq did a sort of reverse takeover).
I am one who is wary of stocks that are talked about a lot and recommended by big names, and now prefer ones that to me don't seem to be getting the attention or respect they deserve. There is much danger that whatever is in vogue has a risk of falling back when promotion or recommendations go as far as the fundamentals of the stock will take it. On that dimension, I think that Jinshan might be a good pick in that it looks like whatever promotional lift it has had in the past has exhausted itself, it is certainly not talked about, and new promotion may well lift it again, in addition to whatever value comes out of the properties. |
