>>ebay - Not within 6 months of the IPO <<
Dont even think about shorting this one!
And to think.. wiff wiff wiff wiff
Hey coms broke out..
China to join the legal system of robber barrons but gatting a nasdaq style stock market extortion.
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What if you were given the opportunity to buy a piece of the NASDAQ stock market? Would you jump at the chance? Created as a high-tech competitor to the entrenched New York Stock Exchange, the NASDAQ electronic order execution system now lists nearly twice the number of companies as the NYSE and trades more volume than any other exchange. For 1997, NASDAQ traded 163.9 billion shares and dollar volume reached $4.4 trillion.
A company called Brighton Technologies (OTC BB: BGHT) an American information technology company that has been doing business in China for nearly two decades. The company boasts a history of over $160 million in completed contracts. Now, in a joint venture with the Chinese government, Brighton is developing a NASDAQ-type securities trading system called STAQ Online. Recent history seems to indicate that the STAQ system will be a huge success. When China originally allowed a handful of companies to publicly trade their stock, riot police were needed to restrain the throngs of would-be Chinese investors. An online order and execution system is the next logical step to modernize the Chinese securities industry and improve access to capital markets world wide. Can you imagine how such a system will be received by this nation of over 1 billion people? And at the end of the newsletter we discuss the mechanics of undeclared short selling.
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Financial Highlights: Brighton Technologies Corp. (OTC BB: BGHT)
Shares Outstanding (October 19, 1998) : 4,530,379 Shares
Float: 1,152,491
Current Stock Price: $5.00
52-Week High / Low: $10.825 / $2.00
Profitability: 16 cents per share profit for the first half of 1998
Many modern services that we take for granted in America simply don't exist in China- but thanks to innovative information technology companies like Brighton, they will. Brighton has already built a successful business by helping China on the fast track to modernization. They have installed the country's busiest telex system in the city of Guangzhou, built cargo-tracking systems for over half the railway ministries in China, and developed an image processing system for real-time visualization of China's flood-prone rivers. This history of achievement has laid the groundwork for direct involvement in the financial future of China.
Brighton's STAQ Online securities trading project warrants international attention. So far, four major cities are linked through STAQ and trading terminals are being marketed to brokerage firms in those cities. The company receives $1,000 per month for each terminal in use. There are about 100 terminals active now and the current network will support about 3,000 terminals. The company projects a national demand for 45,000 terminals. Over the next few years, Brighton intends to expand into 65 cities across China to capture a significant portion of the market. Demonstration projects have already been done in Hong Kong and Taiwan. The STAQ system will modernize the Chinese securities industry and allow hundreds of millions of Chinese to invest in their nations growth.
Other applications of STAQ technology may augment revenues from the securities trading function. STAQ's secure multi-point order entry and execution system can be used for credit card clearing, ATM transactions, airline reservations systems and any other type of information transaction where security and confirmation are primary considerations. Furthermore, the STAQ backbone may also spur the growth of the Internet in China.
At a price of $5.00 per share, we feel this stock represents a superb value. There are only 4.5 million shares outstanding, with a market capitalization of just $15 million. For the six-month period ending June 30, 1998, Brighton reported revenues of $8.9 million, up 95% from the same period last year. They also showed profits of $.16 a share for the first half of '98.
After exhaustive research, the Brighton Technologies investor relations team has determined that there are between 170,000 and 180,000 shares of BGHT that have been sold short in the market. (Please read the article on undeclared short selling that we have included near the end of our newsletter.) This is fifteen percent of all stock available for trading, which may contribute to the uncommonly low share price. Luckily, the market makers that sell stock in this fashion must "balance" the books at some point. This means that they must repurchase all those shares. Imagine what 175,000 shares of volume will do to this stock, if the shorters get "squeezed" into buying to cover their positions. During the week of April 13, 1998 the company traded 143,000 shares total. Allowing for double-printing, only 71,500 shares changed hands but the stock nearly reached $9.
Remember, this stock rose from $3.00 to as high as nearly $11.00 per share, on a weekly volume of 109,600 shares. (March 16, 1998-March 20, 1998). Since then the company has executed a three for one forward split, filed to become fully reporting, announced new contracts and reported a profitable first half. With all these positive announcements, we believe that any increase in volume will have a strong effect on the share price.
Asia will have a great impact on the global economy. It is important for investors to evaluate companies in light of the emergence of China as a global superpower. Brighton Technologies Corp has an extensive operating history and a strong reputation for information technology applications. Having proven the company over the past twenty years, the period of greatest growth lies ahead. Brighton deserves a close look as a means to participate in the modernization of the most populous nation on Earth.
Again, please visit super-stock.net for full details on Brighton Technologies Corp.
About Undeclared Short Selling:This is an excerpt from an article published by investor relations firm Copley-Pacific. It explains the negative effects of undeclared short sellers and outlines a program to help eradicate them. Should you decide to invest in Brighton Technologies Group, please do yourself and your fellow investors a favor and register your shares. Read the following article for more information, and contact your broker for assistance.
Understanding Undeclared Short Selling and How It May Be Impacting Your Company's Stock
Does it sometimes seem that no matter what you do your stock has trouble climbing in price? If this is the case, your company's stock may be facing downward pressure as a result of undeclared short selling.
Short selling can be divided into two categories, declared and undeclared. Many dynamic growth companies have been damaged by undeclared short selling. Created by market professionals, the practice consists of creating stock that doesn't exist. It isn't borrowed but created and it creates enormous negative pressure on a stock price.
The mechanics of undeclared short selling are as follows:
Nonexistent stock is sold short. This nonexistent stock increases a company's float. The nonexistent stock makes it difficult for investors to profit from their risk capital speculations. The short sellers make the profit. The practice hurts the public companies, themselves. It adds massive costs to maintaining a market in a stock and it reduces a company's business options.
The basis of declared short selling is borrowed stock. A short seller provides 50% or more of the value of the stock to his or her broker. This is done in a margin account. The margin protects the broker against any increase in the share price. The broker borrows the stock from a depository trust company. He then sells the stock and adds the money to his client's margin account. Later, the client buys stock (covers) to replace this borrowed stock. The difference between the price the client sold the borrowed stock and the price the client paid to replace the borrowed stock (covered) is the profit or loss from the transaction.
Most declared short players are institutional money managers and fringe group market professionals, not small capital public investors who seldom participate. Declared short positions risk being squeezed. If the company can double its share price, the short seller will be forced to increase his margin collateral in order to maintain the short position. At such time, the short seller may elect to buy (cover) the stock instead of adding to his margin. This adds to the upward movement of the share price.
Undeclared short sellers don't borrow stock. They don't margin the sale of their short position. Because they are market insiders they can use various techniques to sell stock short that doesn't exist.
Is there money to be made by undeclared short sellers? Estimates are that undeclared short sellers make multi- millions of dollars annually.
Complaints to regulatory agencies haven't stopped the practice of undeclared short selling. However, one way companies can protect themselves is to recommend to shareholders that they take physical delivery of their stock certificates. When physical delivery of stock certificates is demanded by a significant number of shareholders, the creators of non-existent stock can be squeezed. The short sellers won't have stock certificates to deliver and thus they will be forced to go into the open market to buy the stock. This will cause losses for them and will cause them to move their undeclared short activities elsewhere. |
