"MSHI" - DOES IT MAKE SENSE THAT THIS STOCK IS SO UNDERVALUED?
I've come across a small-cap company that has substantial cash and it sells for approx $1 per share, LESS THAN IT EARNED LAST YEAR.
The Company is MAN SANG HOLDINGS, INC. ("MSHI" -
Bulletin Board). It's one of the largest suppliers of
pearls in the world, based in Hong Kong, and sells its
products throughout the U.S. and in Europe and Asia.
The NY Times described how pearls are in hot demand
and the dramatic increase in their price and value
(5/24/98 front page).
Man Sang has a pristine balance sheet with more CASH in
the bank than its total liabilities.
As of 9/30/98:
- Cash - $11.3 million
- Current Assets - $40.3 million
- TOTAL Liabilities - $10 million
It has a Book Value of over $8.15 per share - made up
of Real assets. It has liquid net working capital of
$7.90 per share.
Man Sang's subsidiary, Man Sang International Limited,
trades on the Hong Kong Stock Exchange (Symbol:
"938"), since Man Sang last year sold to the public in
Hong Kong 27% of that sub; it kept and owns 345
million shares of the sub (73%). That sub's shares
now sell in Hong Kong for about 3.2¢US per share.
Therefore, parent Man Sang's shares in its sub have a
current trading value of over $11 millionUS - over
$2.55 of current market value for each share of Man
Sang parent for this one asset alone.
I've considered that its numbers are made up, or that
it's a hoax. BUT:
- Man Sang's accountants is the Big-Six accounting
firm of Deloitte Touche.
- Man Sang's legal counsel is the well-known firm
of Kaye, Scholer, etc.
Even in its current 6-month period with all the
problems in Asia, Man Sang has been impressively
profitable; more than 50% of its sales comes from
outside Asia. Its price of less than 1 says it's
going under, but its performance and numbers make this
absurd. It makes no sense.
CHECK THIS ALL OUT YOURSELF, and contact me
with your assessment. All of Man Sang's SEC filings - 10-K,
10-Q, etc. - including financial statements are publicly available.
(IN MILLIONS of U.S. DOLLARS)
3/31 3/31 3/31 3/31 9/30/98
1995 1996 1997 1998 6 MOS.
SALES:$20.5 $26.7 $32.1 $33.9 $14.1 - 6 mos.
NI: $2.6 $4.0 $5.3 $7.6 $1.1 - 6 mos.
EPS: 92¢ $1.44 $1.40 $1.74 $.26 - 6 mos.
MAN SANG has about 4.3 million shares outstanding.
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