3SOF

«American Oriental Bioengineering, Inc. (AOBO.OB). The Group's principal activities are to manufacture and formulate supplemental and medicinal products using proprietary processes. The Group focuses on new product research to combine biotechnology and Chinese medical technology to capture the increasing demand for traditional Chinese medicines and health supplements. The Group owns and operates several plants in addition to a large capacity soybean peptide manufacturing plant. Soybean Peptides are used widely in general food and health food products, sports foods, medicines, the fermentation industry and environmental protection applications. These are easily absorbed by the body and can lower blood pressure and blood fat levels, enhance immunity, lower cholesterol, prevent cardiac and brain blood vessel diseases and inhibit the growth of tumors. During the year the Group acquired Bestkey International Ltd & Harbin Three Bioengineering Limited.»

Look at this company's fundamentals here: Profile for AOBO.OB (http://www.marketwatch.com/tools/quotes/profile.asp?siteid=mktw&symb=aobo&x=0&y=0)

P/E Ratio, Cash Flow, Cash in the Bank, Gross Margins, they're all great.

Technically the stock had a big rise over the last couple of weeks:

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=1538;image)

I personally like this pattern a lot, when a stock is trading sideways, building a base, and then suddenly breaks on the downside with volume above average. But, instead of continuing down, the stock reverses and reenters the accumulation zone. If it wasn't able to break on the downside, made a false breakdown, it is probable that it will end up breaking on the upside.

Of course, the stock is now facing a bit of a resistance for the short term, so there's a possibility of a pullback after my purchase. But think of this: I have sound reasons to believe (technical and fundamental) that AOBO.OB will breakout this resistance. I'm not sure if it breaks right away or if it will pullback on profit taking before it does.

I can't be afraid of profit taking when I have a setup for higher prices. I have to get my position immediately, nevermind if the timing possibly isn't the best. Waiting may prevent me from buying a stock at the short term high, but it also may prevent myself from getting a good and safe profit from the expected breakout in prices.

So I'm not waiting for a pullback, I'm buying AOBO.OB at today's open, 6.66% of the portfolio.

Everyday I will analyze AOBO.OB after the market close until I sell the stock. I always tell I'm going to sell before I actually take action. You just have to follow the answers to this post.

Everyday our team scans and filters 11000 stocks to come up with the 3 best stocks to buy on a short term basis. We run a diversified public portfolio which is up 127% since May 2005 (http://www.3stocksonfire.org/closed_trades.php). We have great traders in our community which take advantage of short term opportunities in stocks.

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This play really looks set to pop.  Check out the breakouts of OBV and Acc/Dis ahead of this move!  :o  nice pick

This will be an exiting day in the never ending story of the fight between the fundamentalists and the chartists.

The stock was under a lot of selling pressure yesterday and the short term outlook seems bearish. The stock is however awesome from a value point of view.

I have put a buy order in at 1.55 (which i see as a support level) and I am hoping that the TA guys will sell out so the value players can take over and continue the run    :D

We will see!

I have my position, altough the stock had a pullback, a pullback that I suspected could be coming. The stock held $1.70, but it is possible it will fall some more in the short term and Michael gets his position at $1.55.

That's not my concern. What I needed was to have a position in a stock that is due to breakout higher and I have that, so I'm satisfied.

Well it pulled back to $1.60. I messed up (waiting for that magic $1.55) and continued waiting and waiting and....

So my question is this now. Do we have a true hammer? Wasn't much of a downtrend (as I understand should occur for a hammer) And if so, might we still have a good buyin Monday morning? On my 1week chart for 60min, CMF shows dropping into the red, A/Distrib has dropped, as has MFI....lShort term??? Long term??

Thinking people want to know?   TIA!

Hi Tirebldr,

Yep, nice share. The chart advanced quite a lot. There where two retracements. The first minor (~25%) the second little more (~50%) with a stronger move up. That looks for me like serious accumulation(to little pullback – that means the persons behind have less patience). But after three advancing legs there should be a little rest. 

Using indicators based on 60min charts may create many false alarms with pennies. It's my opinion, but maybe you have that little extra sense.

One thing confuses me. This company has a book value of 0.88$ per share and positive P/E. The one $ zone is to low for my feeling, of course if the data are correct. They have all four years continuous growing gross profit. This share should be somewhere else, but not between one and two bugs.  ???

Regards

andyman
 

I like to see AOBO.OB closing above $1.7, the last local high. We do have a hammer, no problem with the magnitude of the prior trend, the problem is the low volume. A true hammer should have stronger volume ... anyway, the pattern is still there and AOBO.OB has a bullish medium term trend.

As I wrote on the first analysis, the stock did a false breakdown of the support level, this usually means it will break, this time for real, on the other side of the range, the upper side.

Fundamentals seem very attractive as andyman noted, I don't have enough time now to check the validity of marketwatch.com and yahoo.com numbers, but I will on the next update to AOBO.OB recommendation.

I bot aobo at near David's price. I like the concept, Chinese medicine. Hey, they've been around awhile. Besides, I work in healthcare in the US and ... need I say more?

Thanks for your posts. It still isn't going to be today that I will go deep into AOBO.OB numbers (perhaps Michael is a better man to do that, by the way Michael, did you get your position? Thanks).

If the stock indeed breaks this range on the upside, as I think it will, based on fundamentals and the false support breakdown, the technical target will be $2.48 for the medium term. This technical setup will be triggered with a close above $1.84 with volume above average.

aobo is up 11 cents at 6%. volume is not high though. looks good

I don't know how to interpret the short term candles on AOBO.OB. We still didn't have that close above $1.84 that would mean a bullish breakout. But thinking about the technicals and the fundamentals (need to check them, on the weekend I'll have plenty of time to do that) this breakout may come anyday now.

$1.84 didn't let AOBO.OB go without a fight. So we've entered a consolidation phase, with support on a closing basis at $1.70 and resistance at $1.84.

As said I believe this stock will break this tight trading range on the upside. I need to have some patience as the stock fights with this medium term resistance level.

AOBO.OB is consolidating between $1.70 and $1.84. I think the stock will break higher on $1.84, because the medium term trend is bullish and fundamentals are attractive.

I think you may see the $1.84 soon.

News:

American Oriental Bioengineering's Common Stock Approved for Listing on the American Stock Exchange
Tuesday July 12, 7:10 am ET


BEIJING--(BUSINESS WIRE)--July 12, 2005--American Oriental Bioengineering, Inc. (OTCBB: AOBO - News), a rapidly growing Chinese company which produces and distributes a broad range of pharmaceutical and nutraceutical products, announced today that its common stock has been approved for listing on the American Stock Exchange (AMEX). The company anticipates that its common stock will commence trading on AMEX on July 18, 2005 under the ticker symbol AOB.
AMEX's approval for listing is contingent upon the company being in compliance with all applicable listing standards on the date it begins trading on the exchange, and may be rescinded if the company is not in compliance with such standards.

"We believe that the listing of our company's common stock on AMEX represents recognition from the investment community of the rapid growth and increasing profitability we are experiencing," said Tony (Shujun) Liu, the Company's Chief Executive Officer. "A listing on AMEX should allow us to further increase awareness of our company among the investment community and enable a larger range of investors to own our stock. This listing is a reflection of the contributions we have received from our employees, customers and shareholders who have made this possible."

Lol, great news, thanks 3puttssuck, I'll applaud you  :D

David,

Congratulation wit the listing of AOBO on AMEX: http://biz.yahoo.com/bw/050712/125456.html?.v=1

I do still not have a position in this little gem but I will before the end of trading today. I have waited too long!  >:(

will aobo go up to $3 ? David

$1.84......goodbye

new 52 wk high

I've gone back 3 years and find the highest volume to be June 30, 2005 at 1,730,600 shares.  Looks like we'll set a new record volume today.

This may be old news to some but I thought I'd post it anyway.  This company has been doing quite well.  I look forward to next quarter's report (August ?).

American Oriental Bioengineering Reports Record First Quarter Results for 2005
Monday May 16, 9:02 am ET 
Revenue Increases 63.3% Leading to a 91.1% Increase in Operating Income

HONG KONG--(BUSINESS WIRE)--May 16, 2005-- America Oriental Bioengineering Inc., (OTCBB:AOBO - News), a rapidly growing Chinese company which produces and distributes a broad range of pharmaceutical and nutriceutical products, announced today record first quarter results for the period ended March, 31, 2005. The Company reported revenue of $9.65 million, a 63.4% increase over first quarter 2004 revenue of $5.91 million. American Oriental had operating income of $3.02 million, an increase of 91.1% over operating income for the 2004 first quarter of $1.58 million. American Oriental generated net income of $2.18 million in the current quarter, or $0.05 per diluted share, an increase of 69.2% compared to $1.26 million, or $0.04 per diluted share for the same quarter last year.
The Company ended the quarter with $12.2 million in cash and cash equivalents, the strongest cash position in its history. AOBO's shareholder's equity increased to $35.3 million, its highest level ever.

aobo at 2.00. Should we sell or is this just the start 13 % in 1 day is nice.

hold or sell ? everybody.

Here's my goofy logic.

LENF gained 77% yesterday after announcing their move to AMEX, vol 1.8M, announced at 11:30 AM.

I'm still expecting a big jump today with a little follow through increase tomorrow.

The day is still young!

Maybe tomorrow will big jump too. Long term will be very goog.

Just added.   ;)

I am in as well! This is one of the beautiful cases where TA and FA go hand in hand.

Could be nice to have a technical target but from a fundamental point of view there is nothing to stop this being a $4.5 stock.

Mike

i am in too ! just got filled at 2.
it's a complete package, FA, TA , newly upgrade to AMEX.  there is no reason this stock will close below 2 ever again.  ;D

Thanks and good luck to all!

In at 2.00

Looks like it just had an organized Fib. retracement from 2.15 back to 2.00.  Now on to higher prices.  Just on observation, this is a less volitile advance at the moment than LENF or CAFE.

But as was mentioned in an earlier post .... the day is still young.

why does this keep falling down ?

I am in too :)

Seems like this one has a potential.

$1.84 was taken out on close with the highest volume in AOBO.OB's history (or should I say AOB?  :D):

American Oriental Bioengineering's Common Stock Approved for Listing on the American Stock Exchange (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=1039359&guid=%7B6F4D0195%2D62DC%2D4F42%2DB1CD%2D2E5AB7974BBC%7D&symb=)

This news will make a lot of people look into AOB's fundamentals, which are very attractive. We're still trading at $1.95 and I already see $2.48 (the technical target of the breakout) on print. Why is that?  ;D

When AOB does get there, I'll see, upon conditions at that time, If I'll take profits or hold for a bigger rise as Michael says.

As I have seen on many different OTC/PK to higher exchange listings, they run up just before the listing, and then take a breather soon after. I expect a pullpack, or sideways trading for the next few days.

Thanks David, keep up the great work!

GL
BadarZ

Well, probably the market already expected AOBO.OB to move to the AMEX exchange and be AOB. So there was some sell on the news. In fact, a change in the exchange a stock is listed doesn't change the company's intrinsic value, does it?

Anyway, I didn't bought because of the listing on the AMEX, I bought because I expected a bullish breakout of the $1.84 resistance level (which indeed happened) and because of fundamentals, which indeed are attractive.

So probably yesterday was just a retest to the old resistance, now support. It won't be any problem even if the stock comes down below $1.84 to close the gap it left open between $1.78 and $1.82.

Expecting $2.48 to be reached soon.

Deleted as there was a mistake in the calculation of the PE values. Reprint with corrected PE values below  ???

What a wonderful piece of research we got from Michael on AOB. Thanks a lot, let me applaud you  :)

Technically the stock is perfect. Made a breakout because of the news it was moving to the AMEX (it would breakout anyway on fundamentals), came back down to test the new support (old resistance) of $1.84 (actually $1.85 and $1.86 were the low for the last 3 sessions, so clearly a support there) and then a rally.

The stock closed at $1.96, up 5% on the day, and I already see $2.48 on print.

If you thought that AOBO was about Chinese Tea and magic rhino powder you might want to take a second look at this company!

Did you know that AOBO has one of the few effective treatments against SARS (Shuanghuanglian Lyopilize Powder injectable) or that they have the only China FDA approved first grade prescription medicine to alleviate bed wetting and incontinence (Cease Enureses Soft Gel - never know when this will come in handy!)

These are two of a long list of products based on traditional Chinese nature medicine. In fact AOBO have one of China's top ten government certified brand (Three Happiness - not sure what government certified means but I guess it is a good thing!). This has helped the company to produce exceptional top line and bottom line growth (see chart below).

But it is not only about their products. AOBO is executing an expansion plan based on acquisitions. The Chinese Governments privatization policy of the pharmaceutical industry presents AOBO with the unique opportunity to acquire formerly government-owned quality pharmaceutical assets at low prices.

They have rapidly expanded the distribution network, which now includes more than 10,000 point of sales and are expanding their distribution outside China to include Taiwan, Japan, Korea, Hong Kong and Vietnam. They even opened an office in US recently focusing on penetrating the US market. I have high expectation to this move due to the general focus on nature medicine in the western world and specifically the buzz around Chinese medicine

I don't buy companies because I like their products, even though it helps. I buy companies because I believe they generate exceptional value for their shareholders which can contribute to my retirement plan.

So is AOBO going to cut a few years of my working life and add a few years to my life on a remote tropical island in the Indian Ocean?  8)

I believe so!

Their fully diluted PE for 2005 is 6.3 based on a conservative earnings forecast (8.5 ttm). This is cheap if you look at their growth. The revenue has tripled during the last 3 years and their profit is growing even faster. With their strong cash position they will be able to benefit not only from the growing Chinese market (China's green and organic market is valued at $8.6 billion) but also from their international expansion.

Let me finish this story with a quote from our Chairman and CEO:

Quote"We continue to rapidly grow our product lines and distribution capabilities, both organically and through acquisition," said Tony (Shujun) Liu, Chairman and Chief Executive Officer of American Oriental Bioengineering, Inc. "Recently, we entered into a letter of intent to acquire Heilongjiang Qitai Pharmaceutical Limited ("HQPL"), a leading Chinese distributor of pharmaceuticals. The transaction will provide us, for the first time, with the ability to distribute our products throughout China because of HQPL's strong wholesale and retail distribution network, which should serve as a catalyst for future growth. We believe we are ideally positioned to continue to rapidly increase revenue and earnings."

I can already smell the Indian ocean!

when we can say goodbye to AOBO.OB and welcome to AOB. I have tried to put a
low purchase order in just to see if I can benefit from the confusion      >:D

David remember to update the 3SOF portefolio with the new ticker. We can't have
a 100% loss on this gem!

Enjoy the feel of AMEX: http://finance.yahoo.com/q?s=AOB

Talking about starting with a clean sheet      ;D

Yes, I'll change the symbol on the homepage right away  ;D

Confusion is right. On ScottradeElite I get a bad request when I look for AOBO.ob, And when I ask for AOB my chart just sits there dumbfounded as if it dont know what to do.
    Good luck today on all who are into AOB

Oooppss, the homepage got an -100% on AOB. But quotes are delayed 15 minutes, I hope it all gets straight a while from now.

Michael,
what is your price target on AOB?

TIA
Oliver

David,

EDNE look very strong today! What do you think about the stock future?

Hope get your ideal as soon as possible.

I believe EDNE.OB is a scam, it will rise until one day, on a beautiful morning, it falls more than 50% on that day without warning.

I don't know where's the thread where I explain why ... please make a search. Anyway, if I was pumping the stock, I would make it close above $4.60 today to make a new relative high and bring in new buyers so I could dump it !

Good luck, be carefull ...

Quote from: la-onda on July 18, 2005, 12:10:22 PM
Michael,
what is your price target on AOB?

TIA
Oliver

Hi Oliver,

I think that Davids target of 2.48 is realistic short time but let me just do a little calculation just to show how undervalued this stock is:

The forward PE is 6.1 (fully diluted 2005)
The growth is 69%
The resulting PEG is 0.09

Here is a definition of PEG (which you of course know!):

QuotePEG ratios, in various forms, are used by many analysts intent on buying "growth at a reasonable price." It is based on the notion that the ratio of a company's current stock price to its annual earnings, while useful, is an imperfect measure of the stock's real value. The PEG ratio is calculated by dividing the P/E multiple by the company's projected earnings per share growth rate over the next year. The theory is that if the resulting value is less than 1, the stock may be undervalued; if the PEG ratio is over 1, the stock may be overvalued. The farther from 1 the value, the stronger the signal. Some analysts consider a 140% ratio as overly generous -- they might look to pare their holdings in a stock as soon as its price multiple exceeds its growth rate by any margin.

Well if you say that AOB should trade at a PEG of 1 the price today should be $21.4.

I might sell a bit before though  ;D but AOB is really a steal at these levels!

Mike

Doubled my position at 1.8.

latest PR...

Westminster Securities Initiates Equity Research Coverage of American Oriental Bioengineering, Inc. (Amex: AOB)
Monday July 18, 5:39 pm ET


ATLANTA, July 18 /PRNewswire/ -- Westminster Securities Corporation has today initiated equity research coverage of Harbin, People's Republic of China-based American Oriental Bioengineering, Inc. (Amex: AOB - News) with a "Strong Buy" investment rating, a six-month Target Price of $ 4.05, a 12-month Target Price of $ 4.50, and a risk rating of "High" over both time periods.

http://biz.yahoo.com/prnews/050718/clm074.html?.v=12
Westminster Securities Initiates Equity Research Coverage of American Oriental Bioengineering, Inc. (Amex: AOB)
Monday July 18, 5:39 pm ET


ATLANTA, July 18 /PRNewswire/ -- Westminster Securities Corporation has today initiated equity research coverage of Harbin, People's Republic of China-based American Oriental Bioengineering, Inc. (Amex: AOB - News) with a "Strong Buy" investment rating, a six-month Target Price of $ 4.05, a 12-month Target Price of $ 4.50, and a risk rating of "High" over both time periods.
American Oriental Bioengineering is a manufacturer and distributor of herbal-based medicines, health supplements and soybean peptide products, all of which the company manufactures in China using organic raw materials. The company has been expanding its operations at a rapid pace over the past two years via selective acquisitions of other Chinese companies with complementary products or product distribution capabilities.

;D

Thanks la-onda, it looks like we're not the only ones seeing value on AOB: Westminster Securities Initiates Equity Research Coverage of American Oriental Bioengineering, Inc. (Amex: AOB) (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=1039359&guid=%7B7E3FAC79%2D4648%2D43DE%2D976B%2D0B37C689CE36%7D&symb=)

Yesterday the stock made a pullback on very low volume, but it was able to maintain the $1.84 support level on close, which is important.

I hope everyone sees the Westminster's recommendation and finally finds the hidden value in AOB.

Hi all,

I just received the Westminster Report. It is a quite impressive 16 pages report with a lot of details about AOB and their peer group. I will try to put a summary together later but you are welcome to drop me a mail with your email address if you would like to receive a copy.

The main difference between what has been discussed here is that Westminster report "only" expects a 52% increase in earnings and has a higher number of shares outstanding fully diluted (46.6 million).

Hello, Michael

This is fred.  I am very concerned about aobo. Could you please send me a copy of the report about aobo?
Thank you very much!

[email protected]

Hi Michael,

Would appreciate if you can send me the report as well ([email protected]). I believe someone said they are AOB's investor.

Thanks.

Well, AOB is perfectly ready to take of, from a fundamental and technical perspective. So, why the wait? I don't know, it is very good when an analyst or trader can determine price direction, answering «when» is too much to ask.

$2.48 is the technical target of the breakout which was confirmed by the close above the $1.84 resistance level.

Michael, please send me the report too, I'll read it over the weekend, my email is [email protected]

Thanks, let me give you some more points on your rating  :D

AOB Finacials:
http://finance.yahoo.com/q/is?s=aob

AOB is still accumulating above resistance. I maintain the $2.48 short term target. Wouldn't like to see a close $1.84, which would signal this was not accumulation, but distribution and a false bullish breakout did happen, like the bearish one ... but for now the trend is bullish and I must continue to believe it will continue.

Did you buy AOB because you expected China to revaluate the yuan?

I guess not but that was what happend today and the happy holders of AOB has just seen the profit measured in USD increase without any fundamental changes in the company's profitability. What a wonderful world!

Now all the analysts are talking about downgrading the chinese manufacturing sector and upgrade commodity and energy stocks.

In the meanwhile we are sitting on a beautiful stock, with great fundamentals who without any doubt benefit from this and all future revaluations.

Even the most diligent research can't match simple luck!

Applaud both Mike and Dave for AOB pick and analysis.

hehe, you're right, that was pure luck. As a fortunate holder of AOB I welcome this revaluation of the yuan.

Technically the stock is moving upward and I guess my $2.48 technical target will be reached next week. Over the weekend I'll read the report you sent me to evaluate if I should take my 38% profit or let the profits run ...

hold or sell?

Hi, zhufred.

Personally...as long as it is going in the right direction, I will hold.   ;D

You'll have to do what you feel comfortable with yourself.

Good luck.

Cheers.

If AOB is up in such a nasty mkt then I think it has more fuel left then we think. Though I will wait for dave decision to sell or hold :)

I will also wait for David's decision to sell or hold .
Thanks a lot.

I've read the research from Westminster with much joy (thanks Michael for the report). But I think it's not wise to change a trading plan because of a brokerage house call or research.

I make my own game and have my motivations to buy or sell. In this case I have the chance of taking a 38% profit in a few days, mostly because of unexpected items:

1) Company went from OTCBB to AMEX
2) Upgrade from Westminster (loses a bit of credibility from this fact: «AOB is an investment banking client of Westminster Securities Corporation, which makes a market in the trading of AOB shares.»
3) Revaluation of the yuan

Three unexpected bullish factors (unexpected and not accounted when I bought the stock in the first place) produced the advance phase on AOB. I like much more of rising stocks without any evident motives ... (the motives are behind the scenes, only known later by the general public, but shown in market action).

I guess I was luck on AOB, and luck is a rare thing in the stock market ... I don't want to push it too much, so I'll try to sell AOB around my technical target of $2.48 a share.

I am in.

Yuan will appreciate further and most likely another 2-3% increase in 6 months. It can go up as much as 20% in the next 5 yrs.

Thanks Dave & Michael for your good analysis. I am in for the long term (~1 year)

I am currently not in this this stock but thought I'd just pass some info. along for those that are.  I just saw a message on the yahoo SIRI board pumping this stock and claiming $5 per share within 5 days.  Awareness of the stock is being created for some reason.   Anyone aware of anything? 

I sold AOB at $2.48, a 38% profit.

Good trade dave, applaud

Dave, you gave your target, you hit it and then sold it.  You hold you word.  Why dont you put t-stop on a stock like this?  With a stock like this going up I put a small trail stop on it and will ride it up unitl the stock falls activating the stop.

Thanks for your posts on AOB.

Perhaps you're right puenthouse, AOB is still on a bullish trend and one should let the profits run. But to change my initial trading plan I need a strong motive, which I don't have here.

The rise in AOB wasn't natural, we got:

1) AOBO.OB turning into AOB, moving from the OTCBB to the AMEX.
2) Buy recommendation from Westminster (the company has banking ties and is the MM of AOB's stock).
3) Yuan revaluation

Anyway, the stock is cheap at current levels, I wish all the best to those who continue to hold AOB.

David,

Congratulation with you profit. Yet another profitable pick (http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=2719;image)

I do however tend to echo puenthouse' sentiment even though I should know better than questioning your targets and trading plans!

Have a look at the 2 year chart:

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=2797;image)

I really can't see any resistance until around 3 but I can see a lot of reason why the trend will continue:

• We just had a golden cross of MA50/MA200
• The change to AMEX is a real thing, which gives investors more faith in the company (some people including myself is reluctant to invest in OB stocks)
• The Yuan revaluation is also very real and might be the first in a row.
• I agree that you should be skeptical for the Westminster research but the actual reported figures shows spectacular growth Quarter over quarter (69% for Q1 2005)
• The PEG is 0.21 so the stock is still very cheap (read undervalued) even after this run up
• The Chinese privatization of the pharmaceutical industry offers AOB a unique opportunity for profitable growth through acquisitions

I am still very bullish on AOB. We might see the "Dave effect" short term but AOB is a steal at these levels.

sell or buy?

zhufred, in times like this, and i take it you are down.  I would just put a short trail stop and ride it up till it drops, unless you want to long this.  the volume is down.  we got lucky and hit the good news and got out.
GL

I am staying (it closed around the price I bought).

- Very undervalued
- Aging & weathier chinese people
- Getting into overseas market
- AMEX listing
- Chinse yuan appreciation (I think part of the drop last 2 days was that they saw a report saying chinese government claims no more further appreciation, but they said no appreciation since last week's surprise adjustment, so I think there will be another 2% next year)
- Growing every year

Hi Valueseeker,

I have doubled my position today. We have seen a small correction as the stock was over bought. It seems like the correction is over and AOB will soon be ready to continue its uptrend.

Fundamentally there is no reason that the stock should trade at these levels and technically it will soon also be ready to move. I remember Melf Elf has been talking about a bullish flag formation and this seems to resample that. Melf Elf do you agree?

Thanks Michael for your information.

Hi Michael,

Good for you. Yeah, I think the "warning" from the chinese government gave them a triggering point to do the correction on Tuesday and it's heading further up from now.


-Louis

Thanks Michael,
    You were right on the move, applauded ;D

Michael,
     Do you have an exit price in mind?  What are your thoughts for short and medium term?
???

Hi Shaker,

Thanks for the applauds!

I have to admit that I haven't really thought about exit. This stock is so undervalued so I think I am here for a long time. I will consider it at the next earnings.

Short time I can see some resistance at 3 but it should be able to go through it.

agree with you Michael, still long with AOB
;)

updated chart:

Thanks for the reply Michael.  I'm with you on this one, I like the potential. :)

Hi Shaker and Oliver,
Nice to see that I am not alone on this long travel up to the north (http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=3311;image)

It seems like AOB is poised to break out of the small base between 2.25 and 2.5. (if there is any TA guy's joining us on the journey I would appreciate your comments on the technical picture!)

still holding AOB !!

BUYINS.NET: Naked Short Web Site Announces ANTP, AOB, ESMC, IW, LPL, NTES Have Been Removed From Threshold Lists Today
Monday , August 08, 2005 10:29 ET

American Oriental Bioengineering, Inc. (AMEX: AOB) engages in the development and production of bioengineer products and traditional Chinese medicinal products. The company's product line includes Health Food, Chinese Medical, and Soybean Protein Peptide products. Health Food product series include compound bio-functional beverage, a nutritional beverage; iodine bio-functional beverage, a compound bio-functional beverage with Iodine additives; and vitamate oral liquid, which is designed to strengthen the immue system. Chinese Medical products series include cease enuresis soft gel that helps alleviate bed-wetting and urination disorder; root of red-rooted salvia tablet that improves blood circulation to remove blood stasis; and double ginseng yishen grain, which is useful for those suffering from neurosis. Soybean protein peptide products include soybean protein peptide powder and soybean protein peptide coffee nutritious health drinks; and soybean protein peptide tablets, which maintains or improves protein nutrient condition of the human body. It offers its products through distributors, sales outlets, and hospital and clinics. The company markets its products in China, the United States, Europe, and Brazil. The company was founded as Champion Ventures, Inc. in 1970 and changed its name to Internet Golf Association, Inc. in 1999 as a result of its merger with Internet Golf Association, Inc. Further, the company changed its name to American Oriental Bioengineering, Inc. as per the terms of an agreement to acquire Harbin Three Bioengineering Limited. American Oriental Bioengineering is headquartered in Harbin, China. With 21.99 million shares in its float and an undisclosed short position, there is no longer a failure to deliver in shares of AOB.

I'm still here also ;D

Hi Shaker and Oliver,

Just a small stop to (http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=3312;image) before the journey continue  ;)

I think we are seeing the effect of AOB being removed from the naked short list. There are apparantly people that buy shares when they comes on the list and off load them when the stock is taken off again. As this doesn't change the fundamentals of the company I will ignore it!

Hey Michael,
    Thanks for the insight, how much more of a drop should we expect? Today was brutal :(

wasn´t a good day yesterday, hope it will bounce back

Unconfirmed Earnings Expected Monday, Aug 15
Thursday , August 11, 2005 06:50 ET

Based on historical evidence the following companies are expected to report their quarterly earnings on Monday, August 15, 2005. These companies have NOT confirmed these dates.

SYMBOL  COMPANY                                   PERIOD  WHEN   EST/REVENUE  EST/EPS
------  -------                                   ------  ----   -----------  -------

AOB     American Oriental Bioengineering Inc        Q2     BMO        $9.65M     0.05


updated chart:

Record EARNINGS, above estimations !!!
>:D
American Oriental Bioengineering Reports Record 2005 Second Quarter Results
Monday August 15, 8:00 am ET
Revenue Increases 98.2% and Income From Operations Increases 140.9% Leading to 122.5% Increase in Net Income; Company Reports Quarterly Diluted EPS of 8 Cents

HONG KONG--(BUSINESS WIRE)--Aug. 15, 2005-- America Oriental Bioengineering, Inc. (AMEX: AOB - News), a rapidly growing Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced today record second quarter and six-month results for the period ended June 30, 2004. The Company generated 2005 second quarter revenue of $11.9 million, a 98.2% increase compared to $6.0 million for the same period in 2004. American Oriental Bioengineering generated Income from Operations of $4.4 million, a 140.9% increase from $1.9 million in the 2004 second quarter. The Company had net income of $3.4 million, or $0.08 per basic and diluted share, a 122.6% increase versus $1.5 million, or $0.05 per basic and diluted share, for the comparable period in 2004.
For the six months ended June 30, 2005, American Oriental Bioengineering Inc. had revenue of $21.6 million, an increase of 81% compared to $11.9 million for the same six-month period in 2004. The Company reported Income from Operations of $7.5 million, a 117.8% increase from the $3.4 million reported for the same period in fiscal 2004. American Oriental Bioengineering generated net income of $5.5 million, or $0.14 per basic share ($0.13 per diluted share), a 100% increase compared to $2.8 million, or $0.08 per basic and diluted share for the first six months of fiscal 2004.

The Company ended the period with its strongest balance sheet ever, as it had cash and cash equivalents at June 30, 2005 of $11.4 million compared to $5.4 million at the end of the first six months of 2004.

Second quarter sales of the Company's PBP Products increased by 223% as compared to the same period in 2004, contributing to American Oriental Bioengineering's strong results. This growth was primarily a result of an increase in sales of Cease Enuresis Soft Gel products. Also, the acquisition of HSPL contributed to the increase in sales of PBP Products due to a broader product line. Sales of PBN Products increased by 21%, as a result of increased marketing and sales initiatives.

"We continue to experience rapid growth as a result of our innovative products and expanded distribution capabilities," said Tony (Shujun) Liu, Chairman and Chief Executive Officer of American Oriental Bioengineering, Inc. "The acquisition of HSPL has enabled us to expand our product line and enter new markets. Through the combination of new product initiatives and expanded sales and marketing activities and a strong balance sheet, we believe we are well positioned to continue to generate strong organic growth and to selectively pursue accretive acquisitions."

awesome results, AOB will go much higher IMO
updated chart

awesome results from AOB, check my updated post before:
AOB: Q2 Results 8c vs 5c; Beats 5c Est; No Guidance
Monday , August 15, 2005 08:03 ET

QUARTER RESULTS
American Oriental Bioengineering Inc (AOB) reported Q2 results ended June 2005. Q2 Revenues were $11.90M; +98.33% vs yr-ago; BEATING revenue consensus by +23.32%. Q2 EPS was 8c; +60.00% vs yr-ago; BEATING earnings consensus by +60.00%.

Q2 RESULTS      Reported      Year-Ago     Y/Y Chg      Estimate    SURPRISE
----------  ------------  ------------  ----------  ------------  ----------
Revenues:        $11.90M        $6.00M       +98.33%        $9.65M     +23.32%
----------  ------------  ------------  ----------  ------------  ----------
EPS:                  8c                5c            +60.00%            5c     +60.00%
----------  ------------  ------------  ----------  ------------  ----------

QUARTERLY GUIDANCE:
Company provided NO Revenue guidance for next quarter.

Company provided NO EPS guidance for next quarter.

ANNUAL GUIDANCE:
Company provided NO Revenue guidance for coming year.

Company provided NO EPS guidance for coming year.



;D

I'll buy it back again at the open ! (let's see if I can buy lower than the sale at $2.48 a couple of weeks ago)

Buying AOB for the 3 Stocks on Fire Portfolio at the open, 6.66% of capital.

Thanks for the alert la-onda !

my ameritrade screener shows no GAP up.  is there one?  if not, why not?
results are very good.

is there a GAP up price -- meaning a price beyond which you would not buy AOB ?
(perhaps it might make sense to provide that price on fast moving stocks)

-rocket8

I just bought DDSI !!!

$0.01USD./DDSI this Week!

I didn't bought this gap up, I'll pass for now ... look to buy in a few days, don't like to buy these gap ups when we did already had a big rise.

I should have said $2.48 was my limit ... good luck for those who bought AOB, it's a good medium/long term holding.

looks like your stocks (overall) are doing nicely dave. 

i never bought AOB. 

it still looks too good to be true.

even at today's price the multiple is so damn low.

personally i am bothered by the fact that yahoo does not have a message board for AOB.  i like to speak to many people (bashers) about the negatives of a stock.  i think the fact that traders/investors cannot talk to each other on this "china" stock is keeping the price down.

what's amazing is that AOB is growing and growing.

-rocket8

ROCKET8,

THERE ARE ACTIVE MESSAGE BOARDS ON :WWW.RAGINGBULL.LYCOS.COM
                                                               
AND YAHOO INTERNATIONAL BOARD (I DON'T HAVE THE DETAILED ADDRESS).

BOTH BOARDS ARE STILL USING THE BB SYMBOL---AOBO.OB

                                                            BALTOJOHN

sell or hold? Ihave no idea. Who can tell me?

I bought AOB long time ago but only bought few K shares.

Before I bought it, I studied their 3 years of financials: earnings, revenues, products, markets, etc. Everything is rosy.  If it is an America company, it will be at least $10 stock.

I also believe that Chiese herbal has big market in China. The only concern is whether they cook their books.

This company is in HeiLingJiang which has the reputation of corruption, fraud.

I read stories that all the officers are "bought". That is, in order to get promotion, they need to send cash to their bosses. After they got promoted, these newly promoted officers will do the same thing to make up their loss.

So, it will not hurt if I only own few K shares.

I sold mine today at 2.69.  Been holding since 1.90.  I feel I can buy it back less than 2.69; it was just in the 2.20s until today.  I've seen so many come back down that now I take the gain when I can.  I feel this will trend higher, but for now I'm pleased with the 41% profit.

All this IMO.

updated chart, still long with AOB
I will hold this one

Found a house and found time to look at Q2 from AOB (http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=3311;image)

One of the issues that has been raised in this thread is the credibility of the Westminster report:

Quote from: David Randolph on July 25, 2005, 07:07:46 PM
2) Buy recommendation from Westminster (the company has banking ties and is the MM of AOB's stock).

I agree that this is a valid concern so it is so much more encouraging to see that Westminsters forecast was confirmed by the Q2 figures:

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=3986;image)

AOB is enroute to achieve a PE for 2005 of 12 and a PEG of 0.23. I think that is cheap so I am holding AOB for the long run. My target is 5.9 or a PEG of 0.5 Still very cheap but I guess that chinese stocks have to be traded at a discount. I am not sure if half price is reasonable but I bought cheap so why be greedy!

AOB is moving up today with solid volume:

Yes I am still holding and target is >$4.00.

Be careful:

   They may push the stock up and later to ask additional fund for their operation.

Many China's stocks do the trick: report very good earnings, eveything looks perfect,  then ask additional money from the public. At certain point later, the stock crashed.

   I read their report, they mentioned that they are short of cash for their recent acquizition.
So they may ask to raise cash in the near future.

I believe you are incorrect.  From my understanding, they have enough cash to acquire the company they announced without any dilution to shares.  I'm not sure where you are getting your information from. 

According to the 10Q:  The Company currently generates its cash flow through operations and the Company believes that its cash flow generated from operations will be sufficient to sustain operations for the next twelve months. ..as of June 30, 2005, the Company did not have any plan for additional capital through external funding and financing.

I'm long on this stock and believe we will see 3 by the end of this week of early next week.

Good luck to longs.

Just passed $3, looking very bullish !

damn AOB !

it could double still.

the PE is too low.

i dont own it. argg.

Hi Daniel,

Hmm... that's a shame. We can hope for a small pull back (not to big thanks!!!). I would buy on weakness (as I have done before in this stock).

The Chart looks strong though:

From marketgainer.com:

QuoteMarketGainer.com strives to find dynamic issues that are unknown but because of their technology, approach, executive team, recent discoveries or other key factors, could advance in the market. MarketGainer.com has identified the following company based on these criteria. American Oriental Bioengineering (AMEX: AOB) develops and distributes plant based pharmaceutical and nutriceutical products using natural plants and organic soybeans as raw materials. The company has two product lines with over 100 products. The first category covers plant-based pharmaceuticals including Shuanghuanglian Lyophilize Powder Injectible and Cease-Enuresis Soft Gel. The second category covers nutriceuticals including a series of soy protein peptide products and health supplements which can be delivered by way of injections, tablets, capsules, powder, and oral liquids. American Oriental's is able to extract soybean peptide more efficiently than using the traditional techniques. The company produces Cease-Enuresis Soft Gel which is the only Chinese FDA-approved, prescription medicine to help alleviate bed-wetting and incontinence.

On August 15, 2005 American Oriental released exciting news and its share price has continued to increase as a result. Today, the company's share price has increased 5.19% and volume has surged above average to over 800,000. On August 15, 2005 the company had announced its financial results for the second quarter and six months of 2005. American Oriental did very well this quarter. The company stated that its second quarter 2005 revenue increased 98.2% to $11.9 million compared to $6.0 million in the same period of 2004. American Oriental Bioengineering generated Income from Operations of $4.4 million, a 140.9% increase from $1.9 million in the 2004 second quarter. The Company stated that it had net income of $3.4 million, or $0.08 per basic and diluted share, a 122.6% increase compared to $1.5 million, or $0.05 per basic and diluted share, for the comparable period in 2004. For the six months ended June 30, 2005, American Oriental Bioengineering Inc.'s revenue increased 81% to $21.6 million, compared to $11.9 million for the same six-month period in 2004. The Company reported Income from Operations of $7.5 million, a 117.8% increase from the $3.4 million reported for the same period in fiscal 2004. American Oriental Bioengineering's net income increased 100% to $5.5 million, or $0.14 per basic share ($0.13 per diluted share), compared to $2.8 million, or $0.08 per basic and diluted share for the first six months of fiscal 2004.

No news which readers of this thread were not already aware of but it is nice to see that the word is spreading!

Let me just give 5 applauds on Michael for AOB, great, great pick on fundamental analysis. I still don't know how I let this one escape  :-\

Well, it happens, continuation of a good trade for those still holding  :D

just awesome
:D

This is great!

I'm so happy that I held most of them...sold some to pull home a bit of profit, but really couldn't imagine that AOB would go up 15%+ today  :D :D :D

Now what to do?  ??? Sell - or hold the rest?  ???

Buying is easy, it's the selling I'm having problems with.

another stab in the side from AOB
oh its killing me. lol.  never owned it.
watched and watched....

AOB is has such a low PE.  I wonder why?

what do you think of the strategy of holding AOB until it slides back a bit and then selling?

in other words.... why sell while it is going UP.  maybe its best to hold it and sell it on the day it falls back a bit.  that way you take all the profit you can and give up a little when it stops going up.  = Trailing Stop Loss.

I made up my mind, rocket8...I sold!

30-some-% gain.  ;)
It has been a while!

And then I went all mushy and emotional - bought more of my favorite: ESLR.
I'll try to write about it later.

Thank you, Michael, for all your great work! (Hope you found your house?)

Hi Cumulina

I undestand your decision but it would probably not surprise you that i don't agree  ;)

I had expected a consolidation today after the doji yesterday instead we got a spike up. If I wanted to sell I would probably had done it at the opening. This just tells me how difficult it is to make predictions about a stock in a strong uptrend like AOB.

If you look at the chart below you will see that the stock is increasing under increasing volume. For me that is very bullish especially after a three month run like this.

I am sure there will be a consolidation sooner or later but i really wouldn't like to be out of this stock (and I am up almost 200%)

Westminister had a 1 yr target of $4.5. In its 8/19 new report, it has upped the 1/2 yr and 1 yr target SIGNIFICANTLY - all just based on PE of 16.

The volume of the trades speak to everything.

Is AOB done or it will break $4 ??

According to the new analyst report, we will double from here in a year, based on a conservative forward PE of 16. I didn't sell in the low 2's and won't sell in the 5's. :-)

updated chart:

Updated price target: $7.84, based on conservative forward PE of 16 (most of the US biotech has PE of 30)

http://www.marketwatch.com/tools/quotes/snapshot.asp?siteid=bigcharts&dist=bigcharts&symb=AOB&sid=1039359&time=8

on fire again !!!

Hi Oliver,

A beautiful chart! I never understood why it reversed in the first place so I tried to buy more yesterday but my order was never filled (my bid was too low as usual with AOB!)

I hope I will get another chance to add to my position. This stock is still extremely undervalued.

The last two candlesticks represent a bullish engulfing and the white candlestick was printed under increasing volume. A promising sign for the coming days!

I don´t want to repeat me again, but ON FIRE !!
>:D

Quote from: la-onda on September 01, 2005, 01:52:12 AM
I don´t want to repeat me again, but ON FIRE !!
>:D

Hmmm.... it is difficult to keep coming up with a new tag line on a stock that just keeps going up so let me also repeat myself: A beautiful chart - and there are still plenty of upside left in this stock!

American Bull's posted a confirmed buy recommendation on the stock yesterday so we might see some additional interest today. (If anybody follows AB's recommendations!)

Mr. Tony Liu,Chairman of AOBO's Board of Director, had a meeting with Mr. Ray Rivers of CRT Capital Group LLC on August 24.

CRT Capital Group LLC ("CRT") is an institutional securities research and brokerage firm focused on high-yield and convertible debt, capital structure arbitrage, mergers and acquisitions, special situations and distressed securities.

I am not sure what the meeting was about but it could be about a new acquisition or maybe we are going see some new analyst coverage (it could of course also be that they are old buddies back from the boarding school  :D)

Hmmm Oliver must be sleeping.....

but let me at least post the beautiful chart (it seems like we have broken 4):

Good stock. Still holding.

In at $2.29 08/01. Almost 100% gain.

hi michael,
during this weekend I will be celebrating the baptise from the 2nd son of my best friend in BILBAO.
From tomorrow on I am a Godfather!!  ;)
Back on çmonday evening!
AOB just wonderful again, I have sold 25% for being invested in HOM, but the rest I will hold (110% profit now)

hasta luego
OLIVER

The beautiful thing is that it's still very undervalued. The recent analyst report has one year target at $7.84 based on forward PE of 16.

Well seems like VPHM chart to me. I am regretting selling it so early. Goodluck to all those who are still holding.

on fire again  :-*


chart:

Quote from: stocky on September 04, 2005, 09:40:47 PM
Well seems like VPHM chart to me. I am regretting selling it so early. Goodluck to all those who are still holding.

Hi Stocky

Let me challenge you a bit  >:D

Try to look at the two charts below. To a certain extent they are identical except that AOB is lagging VPHM with a couple of months.

So if you could buy VPHM today at 7 would you hesitate a second?

Most likely not - but still you are just watching AOB going up every day.

It is always difficult to buy a stock after a 200% increase over a couple of months but I have done that with some of my biggest wins including VPHM. (and some of my largest losses have been shares that I bought after they had dropped 200% or more!!)

Michael,

Once again thanks for your fundamental analysis(applaud)I kept this one around due in large part to your findings and now I can ride it out with no fears. Bought it back in the 2's and hope to sell much higher.

Thanks again for all your research! ;)

Brad

Thanks basanlas - I bought below 2 and also expect to sell it muuuuch higher.

There was a good buying opportunity today (IMO). We had a gap in the chart and somebody decided that it was time to close it. Wonder if there were any 3SOF's that was fast on the trigger!

Now it is done and over with and we can hopefully start to break new ground:

Y'all convinced me, after a bit of DD, to nibble.  2005 estimated earnings at 35 cents and growing fast.  15 and 23 cents respectively in 2003 and 2004.  Top line growth is even more impressive with stated plans in place for expanded distribution.  And a clean balance sheet  to boot.  Really nice find ... I appreciate your thinking on this one Michael.  Dave

AOB almost went up each day in the last 2 weeks. EPS estimate for 12 months ended June 2006 is $0.49 which gives a pps of $7.84 with PE = 16

Thanks Michael, I am convienced. :)

Hi Stocky

Congrats! I hope you timed your buy right (read bought at the opening!)

Very impressive action today with good volume. Interesting to see how it increase with high volume and consolidate with low volume. A beautiful chart:

#1 in the list...congrat to everyone here.
http://biz.yahoo.com/special/low912_05.html

Very nice!  Congrats to all.
Do you think that there might be another buying opportunity, or has it risen too high and fast?  I got in under 2, but would like to add some to another account.
Thanks,
Brigitte

Quote from: Michael on September 06, 2005, 12:54:24 PM

Quote from: stocky on September 04, 2005, 09:40:47 PM
Well seems like VPHM chart to me. I am regretting selling it so early. Goodluck to all those who are still holding.

Hi Stocky

Let me challenge you a bit  >:D

Try to look at the two charts below. To a certain extent they are identical except that AOB is lagging VPHM with a couple of months.

So if you could buy VPHM today at 7 would you hesitate a second?

Most likely not - but still you are just watching AOB going up every day.

It is always difficult to buy a stock after a 200% increase over a couple of months but I have done that with some of my biggest wins including VPHM. (and some of my largest losses have been shares that I bought after they had dropped 200% or more!!)

Luckyfish,

I'll just add what Michael said in a prevoius post on Sept 9th. It should ring volumes to the stock,its momentum and its potential from here. There is one thing I have learned since joining 3SOF, the trend is your friend!

Good luck.

basanlas

I think it's too conservative to have forward PE of only 16 for AOB, after it being listed as #1 on IBD's highest growth stock under $10. At PE of 20, with forward earning of $0.49, this is a ~$10 stock, and at PE of 30, this is a $15 stock.

And like old sinner I am back @ 4.44

It hurts b/c my first buy was at 1.78 and sell at 2.45.

But with AOB current strength, I hope it wont hurt any more.

:)

I think that I'll jump back in on a dip. Hope that it's just a slight dip!
Thanks to all!
Brigitte

what kind of dip?new 53 week high

chart update:

Hi Brigitte

A famous Danish philosopher once said that it is difficult to make predictions especially about the future – so have that in mind if the future proofs me wrong!  ;)

The AOB chart is extremely strong. The stock went up yesterday almost without any pause and finished the day close to the highest of the day.

Even a first year student can see the stock is undervalued based on the historical performance and the earnings estimates.

We are at a 52-week high so the resistance above is weak.

We got some excellent publicity yesterday.

If you combine all that I wouldn't expect to see any major reversal today. Many investors like you observed the stock going up yesterday and wished to buy in at a slight dip. Well they will be there again today.

I wouldn't mind a small drop as it would make the future up trend stronger but I don't think it is going to happen today. (but remember it is difficult to ...........)

Mike

Michael, let me give you your well deserved 150th applaud.

And in passing, whats your target for AOB?

I had sold AOB  yesterday at 5.62. Never knew I will get a chance to enter again at 5.08. Looks like it will move up tomorrow. Your thoughts Michael?
Let's go AOB.....
P

Hi all,

Have been following AOB from the sidelines the last few weeks, but on looking at the chart, I really wish I had been in with you :P

Amazing grrowth and by all accounts set to continue.

Looking at the linear chart we seem to have a clear asccending trendline running in line with the 9 EMA.  It has been consistently bouncing off one or the other of these.  Yesterday's low just skimmed the 9 EMA, which it could quite possibly bounce off, or otherwise it may retrace to touch the ascending trendline at around $4.50  (Sorry, don't have exact numbers, just eyeballing the chart) ;)

In any case, the volume is still huge and I don't see this train stopping.

Much respect to all who got in with David, and decided to hold, esp. to Michael for his solid fundamental reckoning of where this was/is going.  If we see a retracement below $5, I'm in.

the Scotsman

Thanks to Michael as well. He gave me the final push to take the dive at $2.38 and held since then.


-Louis

Quote from: Pete on September 14, 2005, 03:59:18 PM
I had sold AOB  yesterday at 5.62. Never knew I will get a chance to enter again at 5.08. Looks like it will move up tomorrow. Your thoughts Michael?
Let's go AOB.....
P

Well, got my last fill of AOB at 4.95. That's it for a while.
Any body knows why it is going down like this. Can't just be profit taking.
P

It could be continued profit taking but the chart points to a possible trend reversal.  If today's action continues and the stock closes down, we will have confirmation of yesterday's Bearish Engulfing Pattern.  AOB could just be coming back to the steeper ascending trendline but it is pretty steep so you have to figure it will be broken at some time.

Especially after this morning's rise, if the stock closes down it could indicate that the bear's are winning the battle and we would see further losses.  Bummer since I just bought into this one. :(

But doesn't this chart tell us that its going to bounce off support and continue higher?
Aren't these just little bumps in the road that we've been seeing since the stock started its uptrend?

Any comments?

Ultra, charts don't tell us what a stock WILL do, they can only guide us as to potential courses of action.  Even a confirmation of the Bearish Engulfing Pattern doesn't mean that AOB will continue to go down.  It may hit that steep uptrend line and skyrocket for all we know!  Or it may not even get there before resuming it's uptrend!

The trend is still bullish and people agree that this is a stock that has a lot of potential.  I hope the trend continues but I wouldn't be surprised to see a little pullback as some point.

And don't forget that pullbacks in a bullish stock are healthy.  They are needed to help regain and continue upward momentum.

Thanks for you analysis Basonista. Since I had made some profit on this before, I am going to give it some room i.e. I think I will sell if it breaks the trend line. Actually putting a stop at 4.55.
Good luck to all holding AOB. Hope it skyrockets ;D
P

Basonista,

Thanks for the input.I'll continue to hold it.My stop is at 4.50.Hope it never comes. ;D

my stop was @ 4.75$, I´m stoped out  ???

AOB will be still on my radar, 175% in total was awesome  >:D

I'm staying in as long as it closes above the ascending trendline which today stands around the $4.65 level.


(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=5391;image)



AOB has a strong resistance level around $5.00 so a battle here should not be a surprise.

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=5390;image)



Thanks to Michael for explaining how to post charts this way! :)

[applaud] basonista. The only thing I can add to your analysis of AOB is that it should bounce off the 10 dma ($4.71 today) and/or the Sept 6th high of $4.57

Thanks, PerfectSage.  I added the 10dma to the chart.  AOB did bounce off $4.65 today although, as PerfectSage pointed out, it could have done so off of either the other two points.  My prediction was an educated guess anyway since it is tough to get a specific price point like that with stockcharts.  I zoom in with Photoshop and try to judge the price but it is imperfect at best.

The ascending triangle will either break out to the upside or downside - my bet is to the upside.  If it continues struggling with the $5.00 level, it looks like we have 3 or 4 more days of this battle before AOB has to decide either way.

Search "哈尔滨三乐源集团"-- Chinese name of AOB in www.baidu.com.

If you do not know Chinese, use this http://babelfish.altavista.com.

Basonista,

Thanks for the chart.This chart you posted is compelling.We have three straight lows that dont penentrate the ascending trade line.That is very bullish and the stock should continue upwards.

jmo

updated chart

Thank you Peter for the information about the company.

I checked their web site "www.biosly.com" and "www.three-happyness.com.cn" - they are the same.

It is a real company, ten years of history,  800 emplyees, and has three main lines of products: green nutrition, bio type of food, medicine products, products related to titanium.

After my vacation and return work to China next month, I will check their products in more detail to see how popular and how good they are.

After big run, profit taking will be normal. I am one of them.

If it fells below $3, I will be a big buyer again.

My first buy was at $2.29 on 08/01 and sold it on 09/12 for 100% gain.

But I only bought few K shares fearing that this may be a fake company similiar to many companies in China, specially in HuiLongJiang province.

Normally the best season for this type of company is the end of year and Chinese new year. Waiting to re-take positions later.

Got stopped out at 4.65 this am.Awfull.

TA analysis is appreciated; Michael your are stil invested?

will the support around 4$ hold?
could this be a good re-entry point?
TA advice is appreciated

chart:

Bottom dropping out on big volume - sitting at 3.86 as of this message

Next level resistance at $3.74 hopefully!

I'm holding, and going to buy some more when it settles down.

TA analysis of AOB:

50% retracement at $3.50
61.8% retracement at $3.00

After big run, it has a big profit taking. Because this is not a story stock and has good fundamental.  I don't think that its price pattern will follow the pattern of two years ago.

It reached $4.75 in Jan 2004 and fell to $1.25 in August.

This time, it reached a high of $5.92 and $3.00 will be the bottom I expect.

From the analysis, I will re-enter my position at $3.50 if candlestick pattern shows a strong bullish reversal signal.

Here is the chart:

You can see it has two bounced backs at 23% and 38% retracement levels then continue its downtrend.

I expect it will have another bounce at $3.50.

I had to sell AOB today to protect a large profit. I think the story is someone decided to short above $5. Since it's quarter ending, they want to maximize the profit. The problem is typically little news for AOB before next earning release (mid November), I think the shorts maybe able to keep it down a bit longer & lower. I may consider buy it back if it dips below $3.5.

Certainly selling to take a profit is always a good thing!   ;D  But there has never been an appreciable short interest in AOB, and the last two reports (Aug and Sept 12) had short interest at 400K+ and 316K.  Given that more than a million shares a day have been trading hands of late, the short interest is less than a day's trading volume which is absolutely nothing and not indicative of shorts who can keep the stock price down.

time for re-entry now ???
???

update:
American Oriental Bioengineering Calls Class A Warrants
Thursday September 29, 1:27 pm ET

HONG KONG--(BUSINESS WIRE)--Sept. 29, 2005--America Oriental Bioengineering, Inc. (AMEX: AOB - News), an emerging Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced today that it delivered a redemption notice with respect to all of its Class A warrants on September 6 and, as of September 26, all 7.5 million warrants have been exercised. Also, the Company delivered a redemption notice with respect to all of its Class B warrants on September 22, which would take effect on October 12, 2005. The warrants were issued in connection with the private placement that the Company completed on November 23, 2004. There are no other warrants currently outstanding other than Class A and Class B warrants described above.
???

bouncing back !!!!!!!!!!!!!!!
On fire !!

 ;D ;D
from 3.47 $ to 4.24 $ intrady, order filled @ 4.11$ !!!

AOB bounced back at exactly at its 50% retracement today.

Gained 20% from there.

David or Micheal:

Could you please give some explaination what the news mean?

Redemption means that the company wants to buy the warrants back. Am I right?

Exercised means that all the warrants holders already exercised their right to buy the stocks.

That means, the company gets the money and the shares diluted.

Help needed to have some analysis on this news, which pushed the stock up today:


HONG KONG--(BUSINESS WIRE)--Sept. 29, 2005--America Oriental Bioengineering, Inc. (AMEX: AOB - News), an emerging Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced today that it delivered a redemption notice with respect to all of its Class A warrants on September 6 and, as of September 26, all 7.5 million warrants have been exercised. Also, the Company delivered a redemption notice with respect to all of its Class B warrants on September 22, which would take effect on October 12, 2005. The warrants were issued in connection with the private placement that the Company completed on November 23, 2004. There are no other warrants currently outstanding other than Class A and Class B warrants described above.

Sold yesterday and my order of $3.53 was filled to buy back all my shares while I was in the meetings. Quite amazing!

This is what I have from the analyst report (which has AOB one year price target at $7.84 based on forward earning of 18). It looks like large amount of warrants sold in the last several days (they bought in $0.85-1.6) and it explains why the stock dropped recently. Now it seems that the conversion is over and the market took it very well. For those of us bought VPHM in the $6's, the stock travelled between $5-$6 for a couple of weeks (during warrants conversion) before it really took off. Hopefully, we will see the same thing with AOB here.

--------------------------
AOB has a substantial overhang of unexercised warrants—We estimate AOB has approximately 10.1 million warrants outstanding with exercise prices ranging from $0.85 to $1.60. In total, the exercise of these warrants would increase AOB's total shares outstanding by 25 percent, creating substantial dilution for existing shareholders. On the plus side, we estimate the exercise of these warrants would also bring $8—$9 million into the company's coffers.

Here's some analysis on raging bull. I think there is no doubt that AOB will follow VPHM's path after it's conversion ended at high $6's. We should see new highs before earning release.

------------------------------

the company initiated the warrant call. The terms were something like "if the stock trades at or above $____ for some consecutive number of days, AOB has the right to call (force conversion of) the warrants within ___ days".

AOB saw a chance to pull in this capital and made the call.

Prior to the warrant call, which forces conversion, the warrant holders could have CHOSEN to exercise the warrants at any time. Generally they don't until the warrants are about to expire (assuming they are in the money), as waiting defers both the cash flow out and starting the tax clock.

3MM shares will be issued as the warrrants are converted. With about 40MM shares out, this is not a huge impact. What often happens is that the stock price drops towards or to the exercise price as warrant holders sell short, exercise the warrant, and deliver the stock acquired via arrant exercise to cover the short. Whether that will happen now, or in fact already happened (the drop last week would be explained if the company contacted warrant holders about the call before making a PR, which probably is the case) is not fully known. In any case, 3MM new vs. 40MM outstnading is not a huge impact. Anyone worth listening to on this co. was already basing their calculations, and decisions, on the fully diluted number--deep in the money warrants such as these are as good as issued.

When I called the co. today, they declined to answer whether they had immediate need for the funds for an acquisition. Very proper--SECc rules, yada yada. I would be disappointed if I heard anything else--that would raise an alarm. Personally, my take is that they DO have something in the works, and soon. They may not need the $5MM to be raised from the warrants (3MM @ $1.60 or so each) to seal the deal (they already have $15MM in cash before the warrant call), but I am guessing they have a significant acquisition coming-to the tune of $10-$12MM, and pulling in this $5MM NOW gives them a working capital cushion.

Thank you valueseeker!!!  Well deserved applause.  You are saving me some research time here and what you say makes sense.  When a company is in a position to force exercise of the warrants asap, I usually like that for it gets the $ in the door, limits the ability to monkey with the market as the warrants mature, and usually indicates that the company sees the warrants being worth more in the future (because of a higher anticipated stock price).  Whether the money is going into the AOB bank account or being used seemed less relevant to me, but probably an interesting question.  I was thinking about exiting AOB but think I will stick in a bit longer now to see if the stock reacts like VPHM....  Thanks!

Sold Friday at $4.75.

It bounced back to the previous 23.8% retracement level,
which is my short term bounce back target and it reached that target in one day.

Next few days will see the stock traded very volital and becomes a good day-trade target.

any opinions about AOBs price action from the board?

TIA
Oliver

bouncing back from 4.00$  ;)

American Oriental Bioengineering Announces Opening of First Specialty Store
Thursday October 6, 1:09 pm ET
''Life Peptide'' Opens in Times Square District of Hong Kong; Features AOB's Soy Bean Peptide Products, Expands Distribution Channel

HONG KONG--(BUSINESS WIRE)--Oct. 6, 2005-- American Oriental Bioengineering, Inc. (AMEX: AOB - News), an emerging Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced that on August 12, the Company hosted a grand opening for its proprietary retail specialty store called "Life Peptide," located in the Times Square district of Hong Kong. "Life Peptide" will carry American Oriental Bioengineering soy bean peptide products, intending to respond to the growing demand for these products in new markets, such as Hong Kong. Soybean peptide products are sold over-the-counter remedies intending to promote general overall health for potential users and are utilized as a remedy for a variety of common ailments affecting a person's overall health and wellbeing.
In addition to being sold at the "Life Peptide" store, the Company's soy based peptide products will also be offered for sale by other nutraceutical chains commencing on October 15, 2005 including Manning China Resources and Health Plus. The Company expects its soy based peptide products to be on the shelves in approximately 100 stores from such chains.
"This opening of "Life Peptide" exemplifies our strategic business model of increasing the availability of our products to potential customers in under-penetrated and fast growing markets," commented Tony Liu, Chairman and CEO of American Oriental Bioengineering. "This initial move into the Hong Kong market with both our own store and through the distribution channel of other established retailers will increase our customer base with relatively low associated costs and also give us the opportunity to increase sales in the region on a faster basis. We look forward to growing our presence in the region as it becomes a significant contributor to our overall business."

Question: I've seen this a few times in the last month or so, where just before or after the close, the price for AOB drops about a dollar. For example, on Friday Yahoo showed AOB closing at 4.30. But AH the Real Time ECN price on Yahoo showed 3.33. Who's doing that and how?

Michael Colin

do u guys think cramers take on chinese bio tech stocks on Friday will have any effect on AOB. Cramer basically said not to trust and trade any chinese bio-engineering stock like TBV ehich is in the same business as AOB

Cramer pumped CMED (chinese biotech) big time. Long term there is no effect of what he says.

http://biz.yahoo.com/special/low1010_05.html

Still #1 in IBD highest rate stocks under $10, even though most of the #3-10 have changed.

The premuim service of Briefing com today so got a boost

Tuesday , October 11, 2005 14:15 ET

This is the 1st VOLUME alert for AOB in the past 7 calendar days.

Trading for American Oriental Bioengineering Inc (AMEX: AOB) has been heavier than usual in today's session. By 14:15 ET, the stock had already traded 2,272,400 shares via 569 trades. The cumulative volume is 41.07% above its 20-day average of 1,610,825. Normally the stock experiences around 588 individual trades per session.

So far, today's volume surge has caused a net rise in AOB's stock price. At the time of this alert, the stock was trading at $5.170, up $0.640 (+14.13%).

One year ago, the Company's shares closed at $1.300. The price has gained more than 297 percent since then.

Over the last 10 trading session AOB has traded in a range between $3.460 and $4.880 and is currently trading 12.67% below its 52-week high of $5.920 set on September 13,2005 and 406.86% above its 52-week low of $1.020 from May 02,2005.

In the previous 3 sessions, AOB trading has displayed a positive trend. Closing results have been as follows:

October 10, 2005 --- closed at $4.530 up $0.230 (+5.35%) on 872,700 shares
October 07, 2005 --- closed at $4.300 up $0.030 (+0.70%) on 361,300 shares
October 06, 2005 --- closed at $4.270 up $0.120 (+2.89%) on 1,146,700 shares

updated chart:

news out, any comments:
American Oriental Bioengineering Inc. Calls Class B Warrants
Thursday October 13, 8:30 am ET
Receives Approximately $11.2 Million in Gross Proceeds from Call of Class A and Class B Warrants

HONG KONG--(BUSINESS WIRE)--Oct. 13, 2005--American Oriental Bioengineering Inc. (AMEX: AOB - News), an emerging Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced that on Sept. 22, 2005, the company delivered a redemption notice with respect to all of its Class B warrants, and as of Oct. 12, all 3 million Class B warrants had been exercised. The company had previously delivered a redemption notice with respect to its Class A warrants and, as announced on Sept. 29, all 7.5 million Class A warrants had been exercised. The Class A and Class B warrants were issued in connection with the private placement that the company completed in November 2004.

The company received, in the aggregate, approximately $11.2 million in gross proceeds from the exercise of the Class A and Class B warrants. Giving effect to such exercise, the company expects to have approximately 50.3 million shares of common stock outstanding on a fully diluted basis.

You can make investing a geometrical exercise or an intellectual challenge. The geometrical approach might short-term be more profitable but the intellectual approach seems to build long-term wealth and is a hell of a lot more fun.

I often read posts build on the same skeleton with different flavors:

QuoteThe stock showed weakness so I bought (or sold) the stock is down x% after I sold (up x% in case of a buy).

The same buyer (or seller) turn around a couple of day s later. The only thing that they have in common is that they always earn money whether the stocks goes up, down or sideways. (We have a few noticeable exceptions on this board with a different flavor like David, eliteG etc.).

My experience after 20 years or so investing is that if you are long the most profitable investment strategy is to invest in fundamentally great stocks that are fundamentally undervalued. (http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=4982)

AOB is an example of such a stock:

• They are in one of the world largest health markets (and the fastest growing!)
• They are rapidly expanding their distribution network
• The privatization policy of the Chinese Government offers unique acquisitions opportunities (these guys have been in the bed with the Government for years!)

The revenue and profit growth is the best proof of the unique opportunity that AOB offers the intellectual investor. (http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=5046)

But AOB is not the only option out there.

• You have stocks that are growing very fast and still have a dividend yield of close to 20% (NFI)
• You have stocks that are doubling there profit and are still trading at a PE below 8 (STX)
• You have stocks that are not able to meet the demand for their products to the extent that their customers are willing to finance the expansion of their production capacity and still trade below 12 times there TTM earnings (KOMG)
• You have stocks that is in one of the fastest growing markets in the world that continues to publish new deals with major players in the market and still trades at a forward PE below 14
• You have companies that seems to have broken the holly grail of medical science and the stock price is dropping in the process (DNDN, CTE)
• You have companies that drastically have changed their business model and are growing their profit accordingly but is still trading at a forward PE of 20

All of these companies have one or more things in common:

• A huge short position
• Negative ratings from analysts
• A geometrical challenging chart
• Are extremely overbought

And according to my opinion a huge upside.

At different pointS in time investors in the following companies have been through the same challenging times: CSCO, MSFT, GE, AOL, EBAY etc. The truth is that all great companies has had periodes where the short community are betting against them, when the chart is weak, when the analysts turn sour, when they go down just because they are overbought. The intellectual challenge is to buy great companies when this happens.

hi Mike,
you have received my message?

tired but happy!
Oliver

updated AOB chart

I had sold most of my AOB shares during the last drawback.  Still hold about 1/4 of my original position and am considering purchasing some more shares here since we are @ new 52wk high.

However,  I have serious concerns about  purchasing any Chinese equities at this time due to the bird flu scare.  If Avian Flu breaks out in Asia, these stocks will get hurt.  Alot of my current Chinese equities have already been hit pretty hard due to, I believe, bird flu.  Does anyone else feel this way? 

Wow, AOB up nicely today...tomorrow will be a good play... ;D

Yep, AOB looks like it could be preparing to pop - nice ascending triangle ;D

Worth keeping an eye out for an opening tomorrow.

i have bought back my AOB shares,
ready to rumble again  >:D >:D

Hey Guys,

Yep I am liking the way AOB is acting right now. Tuesdays close was above the 200ema on my weekly chart $5.32 and at $5.64 the highest close for AOB since this major run started back in May (in fcat it is a 52 week high close price). I am expecting new 52 week high spike tests and closes this week or even as early as today.
Good Luck all

Right, decided to get in on this one with you guys, I really like the ascending triangle formation, and think we should blow through 6.00 in no time.  Today was a close pullback towards support, and I filled my position at 5.36, which made me happy - pretty low downside risk, as I see the trendline coming in at about 5.30 tomorrow.

Andy we got pretty nice upside movement from the lows of the day at the end too  :)

Here's a chart from about 3pm - stockcharts is down so can't get one for EOD.

Lock n load, lets rock n roll >:D >:D

AOB is pushing breakout levels as I write - we got a couple touches at 6.00, and it really wants to get up there

Go on AOB  ;D ;D

Stock looks outstanding. Looks like it may be going parabolic... that volume is awesome, 5x average daily volume!

Applauding...

Own AOB for some time, and been  waiting for a  breakout of that resistance at  6, which has been tested three times since September. Think we will draw a TL3 ascending line from the last time it touched 5 (should go up much fasternow). Although also have to keep an eye on news.

jorge gr

Excellent day for AOB, man am I glad I bought at the low yesterday.  Volume was huge ::)

Just a shame it didn't hold 6.00 at the close, but it was playing with it something crazy.  I expect we should shoot up monday, already sitting at 6.10 AH.

Already looking forward to Monday's action....  ;D

I really don't know why, but often the «whys» come later, after the stock made a great advance, but AOB is breaking out of an ascending triangle. There's an excerpt of Reminiscences of a Stock Operator that fully explains why the explanation for a stock to move isn't all that much important for a trader. The more important and objective thing is that it is moving !

Volume on Friday was the highest on record for AOB, 5.2 million shares traded.

Since this trade will be based on the expectation of a bullish breakout, if that bullish breakout doesn't occur it would not be reasonable to continue holding the stock. I believe AOB will breakout tomorrow and make a beautiful white marubozu to new closing highs above $6.

If it doesn't, I don't want the stock anymore, I will release capital for others moving fast. So my trading plan is:

1) Buy AOB at or near the open, 33.33% of the Fast Portfolio, or $5,000;
2) HOLD if it is set to close above $6;
3) SELL if it is set to close below $6.

AOB is my long term hold. I know why the break-out last week: earning report is 11/15, and we all know what happend after 8/15 - stock went from $2.28 to $6 on Friday.

hi,
this is one i thought about entering since thursday with my swing trading set up but held off.
i need to trust in my own research more , i think that comes with expeirence  but aob looks to be going ahead at least in the short term. think i will jump in monday
thanks
maxi

Applaud david and ramsburg for yet another great way to maximize the utility of 3SF.

Glad to be in the fast lane.

Anybody know when AOB report their 3Q earnings?

Supposed to be on or before 11/15

Why can we assume that AOB's earnings will be good, were there some important announcements or interesting developments last quarte/CC?!

Top spot (HOM is #2) on IBD list (<$10) 3rd time in a row, the #3-10 have changed a lot but #1 & #2 are always AOB and HOM:

http://biz.yahoo.com/special/low1107_05.html

I missed the train... up by 7.5% already.
I will wait abit before buying. :-\

Ohad

i got it premarket 6.22.  Could have got it 6.10;  anyway not bad so far

ket1390,

How can I buy premarket?

DannyOhad which broker do you have? i have ameritrade so there i can buy pre market from 0800-0915 o clock.  Or afterhours.

I buy just pre market when the gap is not that high up....for example i never buy a stock that is 15-30% in the plus; mostly those filll the gap later..

I use Scottrade.
Probably they do not support that.

Hmmmm.... so 3SOF is in AOB again. Great news and a very clever decission as usual!

I can't help asking why it is for the fast portefolio? AOB is a rock solid earnings story (as solid as they come these days  (http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=3072)) and should be 3SOF main portefolio. So David are we going to see an upgrade to the main portefolio when earnings are released (http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=5046)?

Mike

Michael, i'll repeat my question: why can we assume that AOB's earnings will be good, were there some important announcements or interesting developments last quarter/CC?!
I think many of us are still doubting if the should hold through earnings


http://biz.yahoo.com/bw/051107/20051107005850.html?.v=1

American Oriental Bioengineering Inc. to Announce 2005 Third Quarter Results on Nov. 14, 2005
Monday November 7, 11:14 am ET


HONG KONG--(BUSINESS WIRE)--Nov. 7, 2005--American Oriental Bioengineering Inc. (AMEX: AOB - News), an emerging Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced today it will release its 2005 third quarter results on Monday, Nov. 14, 2005. After the release, the company will host a conference call to discuss these results.
ADVERTISEMENT


The conference call will take place at 4:30 p.m. ET. Interested participants should call 888-896-0863 when calling within the United States or 973-582-2741 when calling internationally. There will be a playback available until Nov. 21, 2005. To listen to the playback, please call 877-519-4471 when calling within the United States or 973-341-3080 when calling internationally. Please use pass code 6684462 for the replay.

This call is being webcast by ViaVid Broadcasting and can be accessed at American Oriental Bioengineering's Web site at http://www.bioaobo.com. The webcast may also be accessed at ViaVid's Web site at www.viavid.net. The webcast can be accessed until Dec. 14, 2005, on either site.

About American Oriental Bioengineering Inc.

American Oriental Bioengineering Inc. (AOB) uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications. AOB also produces Cease-Enuresis Soft Gel, the only Chinese FDA-approved first grade, prescription medicine that is specially formulated to help alleviate bed-wetting and incontinence. The company is a leading producer of products in both the nutraceuticals and pharmaceuticals areas in China. For more information, visit http://www.bioaobo.com.

Hi Se7en,

I could answer your question by quoting my posts from 3 to 4 months ago. There is a lot of reasons why I believe that AOB is a fundamental excellent story (the boom in the Chinese economy and health sector in particular, privatization of state owned companies, their particular products, international distribution etc.) Please go back in the original thread.

In this case I will take the easy route though (I am always jealous of the TA guy's who can just refer to the chart ;)). This is a Chinese company. Sometimes a lot of people knows the good news before the market does. With careful fundamental analysis you might be able to predict the results but otherwise the chart gives you a good indication. Have a look at the chart see the reaction to the earnings date today and make your own conclusion:

thx Michael, i looked up their last earnings, they were truly amazing!!! :o


http://biz.yahoo.com/bw/050815/156075.html?.v=1

AMERICAN ORIENTAL BIOENGINEERING REPORTS RECORD 2005 SECOND QUARTER RESULTS

Revenue Increases 98.2% and Income From Operations Increases 140.9% Leading to 122.5% Increase in Net Income; Company Reports Quarterly Diluted EPS of 8 Cents

America Oriental Bioengineering, Inc. (AMEX: AOB - News), a rapidly growing Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced today record second quarter and six-month results for the period ended June 30, 2004. The Company generated 2005 second quarter revenue of $11.9 million, a 98.2% increase compared to $6.0 million for the same period in 2004. American Oriental Bioengineering generated Income from Operations of $4.4 million, a 140.9% increase from $1.9 million in the 2004 second quarter. The Company had net income of $3.4 million, or $0.08 per basic and diluted share, a 122.6% increase versus $1.5 million, or $0.05 per basic and diluted share, for the comparable period in 2004.

For the six months ended June 30, 2005, American Oriental Bioengineering Inc. had revenue of $21.6 million, an increase of 81% compared to $11.9 million for the same six-month period in 2004. The Company reported Income from Operations of $7.5 million, a 117.8% increase from the $3.4 million reported for the same period in fiscal 2004. American Oriental Bioengineering generated net income of $5.5 million, or $0.14 per basic share ($0.13 per diluted share), a 100% increase compared to $2.8 million, or $0.08 per basic and diluted share for the first six months of fiscal 2004.

The Company ended the period with its strongest balance sheet ever, as it had cash and cash equivalents at June 30, 2005 of $14.9 million compared to $11 million at the end of the first six months of 2004.

Second quarter sales of the Company's PBP Products (Plant Based Pharmaceutical Products) increased by 223% as compared to the same period in 2004, contributing to American Oriental Bioengineering's strong results. This growth was primarily a result of an increase in sales of Cease Enuresis Soft Gel products. Also, the acquisition of HSPL (Heilongjiang Songhuajiang Pharmaceutical Ltd.) contributed to the increase in sales of PBP Products due to a broader product line. Sales of PBN Products (Plant Based Nutraceutical Products) increased by 21%, as a result of increased marketing and sales initiatives.

"We continue to experience rapid growth as a result of our innovative products and expanded distribution capabilities," said Tony (Shujun) Liu, Chairman and Chief Executive Officer of American Oriental Bioengineering, Inc. "The acquisition of HSPL has enabled us to expand our product line and enter new markets. Through the combination of new product initiatives and expanded sales and marketing activities and a strong balance sheet, we believe we are well positioned to continue to generate strong organic growth and to selectively pursue accretive acquisitions."

AOB ON FIRE!

Broke the ascending triangle resistance line. Averaged in from 6.23...I think this pick will win the 3SOF challenge!

Quote from: ket1390 on November 07, 2005, 10:01:19 AM
i got it premarket 6.22.  Could have got it 6.10;  anyway not bad so far

If you checked my post on stock picks contest, you could have bought it last Friday at $5.74.

I prsented the same chart as David presented here  in that post.

Among the picks, VPHM, BOOM, WGAT, TMTA, AOB gave the biggest gain so far.

VPHM gave very good earnings, BOOM and TMTA are expecting to have good earnings, so is AOB.

Normally, once the company gives a good report, it will continue the trend for few guarters.

My only regret is that I did not buy it big last Friday, only 10K.

Hey David, thanks for the call on AOB this morning.

3 SOF Fast is a great idea!

Shawfund....i saw your contest pick on friday put on my watchlist...had no cash on friday. Would have been a option otherwise...great pick and contest  :D

Thanks for all your comments  :)

I bough AOB really low (it was still AOBO.OB), but I sold it way too soon, around $2.5 I believe, for a nice profit. That was clearly a mistake, that I wasn't fast enough to correct. Now I see a stock that rose from about $1 to $6.70 in just 5 months. No problem with that, I agree with you, the stock is still undervalued, specially if it is able to maintain its growth rate some more quarters.

I may buy it for the 3 Stocks on Fire Portfolio, but not now, and certainly not after the earnings release, since there's clearly a buy the rumor, sell the fact thing working on now.

I have to do one thing now: clean up my head from every fundamental thought on AOB. The Fast Portfolio is for technical plays only. I believe I'll do better if I just trust the charts for these fast position trades.

So, I bought AOB based on a probable ascending triangle breakout. That breakout has a technical target of around $8.38. That's where I'll take my profits if I have the chance.

Considering the downside, and since this is a Fast trading proposition, I don't want to see this stock losing momentum, specially when there's a buy the rumor thing working (oops, I did it). I consider the stock has lost momentum if it is set to close below the midpoint of yesterday's white candle, which was $6.42.

The trading plan is:

1) Take profits around $8.38
2) Sell if the stock is set to close below $6.42 (if 10 or 5 minutes before the close you see it trading below $6.42, get out).

summarization:
The Street Alert LLC: The Street Alert picks up AOB  as....
Tuesday , November 08, 2005 10:20 ET

Nov 08, 2005 (M2 PRESSWIRE via COMTEX) -- TheStreetAlert.com, named; American Oriental Bioengineering Inc. (AMEX: AOB), and Sunair Electronics, Inc. (Amex: SNR): their "Stocks to watch"

American Oriental Bioengineering Inc. today announced today it will release its 2005 third quarter results on Monday, Nov. 14, 2005.

AOB Highlights:

--The Company generated 2005 second quarter revenue of $11.9 million, a 98.2% increase compared to $6.0 million for the same period in 2004. The Company had net income of $3.4 million, or $0.08 per basic and diluted share, a 122.6% increase versus $1.5 million, or $0.05 per basic and diluted share, for the comparable period in 2004.

--1H05 revenues up 81% year-over-year with net income up 100% year-over-year.

--Strong Balance sheet; $9.8m in net cash as of 6/30/05; approximately an additional $11.2m taken in subsequently with call of all the "A" and "B" warrants.

--AOBO leverages over 10,000 distribution points, including clinics, pharmacies, supermarkets and hospitals.

--AOBO has achieved a 46% top-line CAGR since going public in 2002 through FY ending 2004 --Diversified product line creates broad opportunities for growth: AOBO has three primary product lines- herbal-based medicines, nutritional supplements and soybean peptides.

--Diversified and growing product portfolio:

About American Oriental Bioengineering Inc.

American Oriental Bioengineering Inc. (AOB) uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications. AOB also produces Cease-Enuresis Soft Gel, the only Chinese FDA-approved first grade, prescription medicine that is specially formulated to help alleviate bed-wetting and incontinence. The company is a leading producer of products in both the nutraceuticals and pharmaceuticals areas in China. For more information, visit

http://www.bioaobo.com.

Considering that yesterday's analysis is still valid, I will maintain my trading plan for today:

Quote1) Take profits around $8.38
2) Sell if the stock is set to close below $6.42 (if 10 or 5 minutes before the close you see it trading below $6.42, get out).

I am new here and do not know if this has been noted on other AOB boards, but I view AOB as a potential sleep bird flu play.  I lived in Asia during the SARS scare, and the sales of Korean pickled cabbage (kimchee) went up because people thought that it protected against SARS. 
In general, when there is no real medical cure to a malady, Asian people look to improve their health through what they eat and drink.  Since AOB is a neutraceutical and pharmaceutical company, I believe their products will be in even greater demand as bird flu is in the news.

I have 5500 shares at 5.26 and given the above I intend to hold through at least earnings.  However, I will also follow the charts and analysis and sell if it seems that my hypothesis is wrong.

Beautiful chart on AOB ...The more contacts between prices & trendline the more valid the line....Right on AOB!! ;)

Thanks for your comments and analysis on AOB  :)

I just have to make a slight change to my trading plan for AOB, rising the trailing stop level:

1) Take profits around $8.38
2) Sell if the stock is set to close below $6.80.

$6.79/$6.80 was the last short term high for AOB that made the stock go down one day. I see this level now as short term support and if the stock were to be closing below this I would take profits.

But buy the rumor seems to be continuing to fuel AOB until Monday's earnings report, so probably the stock will continue to advance to my selling target.

hi,
when are the earnings out for aob , ? before or after the bell on monday?
anyone know?
thanks,
maxi

Hi all,

Some fool just called Cramer on his TV show and asked him about AOB, and of course he gave the usual rant about "fine US biotech companies vs. Chinese companies", etc.  and issued a personal foul, basically bashing the stock.

So, what do you think, I am inclined to take profits in the AM if the stock starts to go down.  And then, I might consider getting right back in just before earnings.

Thoughts?

I sold in today's pre-market run-up.

I was following the target from an analyst report: $0.35EPS this year and $0.49 EPS by mid-2006. He was using a conservative PE=16, which arrives $5.6 this year and $7.84 mid next year. The 16 PE is probably too conservative for AOB.

Since it was already close to $7.84 in the pre-market, I took the oppurnity and sold the shares.

I also sold in @ 7.00 today...not so big gain but better than nothing ;)

Good morning, thanks for your posts on AOB  :)

Since this is a Fast Portfolio, I don't want to hold anything that has such a bear candlestick as AOB does. It is a Dark Cloud Cover. Now, possibly earnings are going to be better than expected (probably) and the trend is still bullish, but that's not the scope of the 3 SOF Fast Portfolio.

I trade for 1 to 3 days profits and don't like red candles. I see that some of you got out better than I will (specially valueseeker, congrats), and that's great  :)

I'll sell AOB at or around today's open.

(I think earnings will be released after the close on Monday, the conference call is due at 4:30 pm, EST)

hi,
i also sold late in the day at 6.90 the intra day chart looked like it was breaking to the downside at the end so it may drop this morning with the "cramer affect".
thanks
maxi :D

AOB up 3,65% > 7.10$ pre-market!


http://biz.yahoo.com/bw/051111/20051111005139.html?.v=1

American Oriental Bioengineering, Inc. Common Stock Approved for Listing on the Archipelago Exchange
Friday November 11, 8:00 am ET


HONG KONG--(BUSINESS WIRE)--Nov. 11, 2005--American Oriental Bioengineering, Inc. (AMEX:AOB - News), an emerging Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced today that its common stock has been approved for listing on the Archipelago Exchange (ArcaEx), a facility of the Pacific Exchange, under the symbol AOB. The Company anticipates that its common stock will commence trading on ArcaEx on November 11, 2005.
ADVERTISEMENT


"We are pleased to bring this extra level of liquidity to our shareholders, and additional exposure to potential investors," said Tony (Shujun) Liu, the Company's Chief Executive Officer.

In addition to being listed on ArcaEx, the Company's common stock will continue to be listed on the American Stock Exchange under the symbol AOB.

About American Oriental Bioengineering, Inc.

American Oriental Bioengineering, Inc. (AOBO) is a leading Chinese biotechnology company that uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications. The Company also produces Cease-Enuresis Soft Gel, the only Chinese FDA-approved first grade, prescription medicine that is specially formulated to help alleviate bed-wetting and incontinence. The Company is a leading producer of products in both the nutriceuticals and pharmaceuticals areas in China. For more information, visit http://www.bioaobo.com.

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in statements filed from time to time with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

Hmmmm so 3SOF is out of AOB again. What a shame  ???

David was the first who draw my attention to the outstanding fundamentals of this stock. Since then his has been in and out with relative small profits.

I bought the first time at 1.85 and are still holding these shares at a 289% profit. I am not saying this to brag but simply to point out that a buy and hold strategy seems to work with shares that are so fundamentally strong as AOB.

AOB is up with 5.11% today but calculate from my purchase price I have gained 19% just today.

I am however not going to sell. AOB has a long way to go before it is reach fair value.

Mike

Hi, Michael  :)
I am another one that held all my AOB since $2, thanks to u and all those great info on the boards.  ;D
while i never imagined it could rise this high so soon, i was wondering what u think is 'fair value' and based on what calculation?

Thanks Michael , have a good day !

Michael, i'm still holding too, what do you expect from earnings next monday?
Year over year, it should be no problem, but quarter over quarter...?

still holding too, only i got in the other day... at + 15%.

i really don't know much about this company (just got in with David's 3sof fast pick).

I think i'll opt to take profits later today... incase there's too many sell on news investors Monday.

What a close, from 7.15 to 7.34 in a few seconds!!!  :o  :)

Hi Michael,

You and Dave are the one who drew me to AOB. So big appaude!

I sold AOB at yesterday's pre-market at $7.45, a huge gain after $2.38. This is by far my largest gain after VPHM, which I am still holding a big % from $6.35.

I will be a buyer of AOB again shortly.


-Louis

QuoteQuote Michael: I bought the first time at 1.85 and are still holding these shares at a 289% profit. I am not saying this to brag but simply to point out that a buy and hold strategy seems to work with shares that are so fundamentally strong as AOB.

Michael is spot on here, however the difficulty for anyone is having the right approach to stay with a trade as long as possible to maximise profit. The best method I have found for this is to take a step back from your view of the market (most people here probably looking at intra and daily charts). Use weekly charts once a trade is in your favour as this takes you away from the noise and lets you see the real trend taking place (Use daily in conjunction of course to catch deep reversals). Look at my AOB chart, its easy to see that by tracking below the 9 ema with protect profit stops (placed below 9ema and below most recent reaction lows) you can stay with a good trade longer and get those 200%+ winners as opposed to 30% ins and outs. Sounds easy, but one of the things here is that you do have to have your stop quite a distance from the action to a) keep you in and b) away from the noise spikes. Managing those stops requires discipline and a systematic approach.
In fact look at other winners this year on a weekly chart (VPHM, HOM e.g.) and you will see the same methodology will apply.

From Wallst.net:

On October 6, American Oriental Bioengineering, Inc. (AMEX: AOB) announced the opening of its first specialty store, Life Peptide, in the Times Square District of Hong Kong. The new distribution channel will afford AOB an opportunity to increase its customer base with relatively low overhead, and "also give us the opportunity to increase sales in the region on a faster basis," according to the Company's chairman and chief executive officer, Tony Liu. "This opening of 'Life Peptide' exemplifies our strategic business model of increasing the availability of our products to potential customers in under-penetrated and fast-growing markets."

Fast growth seems to be a recurring theme with the Company, which specializes in the development and manufacturing of a broad range of pharmaceutical and nutraceutical products. Shares of AOB have more than doubled since August 2005, largely due to the Company's consistent financial growth, and ability to capitalize on the privatization of state-owned assets in China.

For the quarter ending June 30, AOB reported revenue of $11.9 million, up 98.2 percent from the $6 million in revenue it reported in the same quarter a year ago. The Company's quarterly net income rose 122 percent to $3.4 million over the previous year. For the first six months of the year, AOB reported revenue of $21.6 million, an 81 percent increase from the $11.9 million it reported in the same six-month period a year ago.

"AOBO has an operating history of over 10 years, and it is one of those companies that is booming in the privatization processes in China," said the Company's co-founder and chief operating officer, Lily Li. "Also, we feel we have a humungous opportunity in the ongoing privatization of state-owned assets in China."

According to Burrill Greater China Group, a life-sciences merchant bank, China's pharmaceutical market, including over-the-counter drugs, is estimated to an approximately $11 billion industry, with roughly $3 billion of that attributed to traditional Chinese medicines, and the remaining $8 billion to Western medicines.

"We believe this environment is very conducive to our fast growth," Li said. The Company will report its third quarter results on Monday.

–Staff Reports

I watched the opening Friday on Level II to see if there was going to be a Cramer effect like there was last time he mentioned the stock, and it started going up instead, so I stayed in the stock all day.  There was news of AOB starting to trade on the Archipelago exchange which may have cancelled out the Cramer effect.

Also, I found a link that I think validates my idea about AOB benefiting from the bird flu scare in Asia:

http://find.thestreet.com/cgi-bin/texis/cramertake?tkr=AOB&site=tsc

then on that page this link:


'Bird Flu' Stocks Still Look Healthy
11/9/2005 11:58 AM EST
By Dan Fitzpatrick
These three charts from the 'bird flu sector' show that their uptrends remain vital.
more

Now the first time I clicked on the "more" link it actually let me see part of the article, and it was talking about AOB.  I dont have a subscription to real money, so now when I check I cant see the article again to confirm what I remember reading quickly, thinking I could go back to it later.

If this is true about bird flu increasing sales, then the fact that China is only now starting to admit to outbreaks (they are happening left and right now) then the panic is going to accelerate and the next quarter sales will be even stronger.

Any one else agree about AOB being a sleeper bird flu play?

I am lucky lucky lucky.

Was watching AOB realtime on level 2 just now and saw a selloff coming so got out at 7.15, its at 5.70 now only 20 minutes later...

I think when the MACD goes positive again I may buy back and hope for good earnings.

Anyone know what is going on???

AOB is in freefall - I thought that looked like earnings hould be good.

Wasn't looking and it has cleared 25%+ now.  Don't even know if I should hold for a pullback at this stage - anyone else have thoughts on this???

Earnings are excellent at first sight, maybe a sell the news thing?! ???

Back in at 5.56, I think this was a decent discount and the stock can still go up longterm, and maybe even rebound quickly after earnings today.  Even if I go down a bit now, its not as bad as what it would have been if I didnt sell at 7.15.  Whewwww.

Scottish Trader,

I think AOB got ahead of itself for a bit which is why I was watching level 2 today so closely.  But at the very moment my daily chart shows a definite rebound, so I personally would stick it out, its back to 5.85 as I type.

Nice moves Tokyopua!  Thanks to all the posts on this thread, I also purchased on today's dip.

What exactly clued you into the selloff?  How can I look for similar situtions?

Thanks for the help, I'm trying to learn.

Yeah seems like AOB got a little ahead of itself.

I guess people were disappointed about the revenue figure. From my perspective the result was more or less as expected. AOB is in line to exceed both the revenue and profit estimates for the year with at least 20%.

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=9210;image)

Revenue is up with 82% and profit is up with 66%. Q4 is the strongest month for AOB with around 1/3 of the revenue so the full year will be great

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=9209;image)

It seems like the up trend is still intact so this is just a little noise in the chart generated by momentum players. The rest of us can look forward to owning a stock which long term will contribute to our early retirement  :D

Quote from: wisebuys on November 14, 2005, 12:44:08 PM
Nice moves Tokyopua!  Thanks to all the posts on this thread, I also purchased on today's dip.

What exactly clued you into the selloff?  How can I look for similar situtions?

Thanks for the help, I'm trying to learn.

Thanks, but I am also a relatively new trader, as I said there was a big element of luck to this.  In this case I knew that the gains in AOB were so fast over the last few weeks that it could not all be due to people investing in the stock for fundamentals, I knew there was a lot of people just looking to trade the stock.  So, over the last few days I kept a fairly regular eye on the real time quotes on Level II (I use power Etrade).  I almost sold it at 6.85 Friday morning as I said below, but again watching the candlesticks I saw an immediate upward trend and held pat in the stock.

I also didnt know when earnings would be announced ahead of the CC, so I had to be watching.  Michael's post indicates that earnings were released, but oddly I cant find the news.  So if it was the earnings dropping the stock price, then I didnt know that, I only saw the selloff based on the charts.

So to answer your question WRT the charts: today I was seeing the candlesticks move down rather quickly after a strong open.  I dont have a way to show you what I was seeing on Level II, but here is a link to how the candlesticks were looking:

http://finance.yahoo.com/q/bc?s=AOB&t=1d&l=on&z=m&q=c&c=

This just yelled selloff to me at this point (the MACD on my chart was already dipping, the Bid/Ask started to flash rapidly compared to what it had been showing sudden increased volume, etc), but I will be honest and say I didnt think it was going to be THAT bad.  I expected it would drop to $6.5 at most, and I might not have bought it back if that was all it had dipped to.

I also had a sense of where to sell since David had done the TA last week to say he would be out at 6.85, so I revised that up after the stock went up again, and figured I would sell about around 7.20 or so if I saw what I saw today.

As Michael shows below, the net trend is still up for this stock if you draw lines through the candlestick bottoms, and I believe the apparent seasonal strength in Q4 will also be augmented further up by the bird flu scare in the region leading people to want to be as healthy as possible in light of the fact there is no vaccine for H5N1.

Can somebody tell me when the earnings were realeased, if they have indeed been released?  I dont see them on the website, on my etrade news, or on Yahoo. 

You can find them on Yahoo!

http://biz.yahoo.com/e/051114/aob10qsb.html

Form 10QSB for AMERICAN ORIENTAL BIOENGINEERING INC


--------------------------------------------------------------------------------

14-Nov-2005

Quarterly Report



ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the information contained in the condensed consolidated financial statements of the Company and the notes thereto appearing elsewhere herein and in conjunction with the Management's Discussion and Analysis set forth in (1) the Company's Annual Report on Form 10-KSB for the year ended December 31, 2004, as amended (which is also incorporated by reference herein) and (2) Quarterly Report on Form 10-QSB for the quarter ended September 30, 2004.

As used in this report, the terms "Company", "we", "our", "us" and "AOB" refer to American Oriental Bioengineering, Inc., a Nevada corporation.

PRELIMINARY NOTE REGARDING FORWARD-LOOKING STATEMENTS



This quarterly report contains forward-looking statements within the meaning of the federal securities laws. These include statements about our expectations, beliefs, intentions or strategies for the future, which we indicate by words or phrases such as "anticipate," "expect," "intend," "plan," "will," "we believe," "AOB believes," "management believes" and similar languages. The forward-looking statements are based on the current expectations of AOB and are subject to certain risks, uncertainties and assumptions, including those set forth in the discussion under "Management's Discussion and Analysis of Financial Condition and Results of Operations" on this report. The actual results may differ materially from results anticipated in these forward-looking statements. We base the forward-looking statements on information currently available to us, and we assume no obligation to update them.

Investors are also advised to refer to the information in our filings with the Securities and Exchange Commission, especially on Forms 10-KSB, 10-QSB and 8-K, in which we discuss in more detail various important factors that could cause actual results to differ from expected or historic results. It is not possible to foresee or identify all such factors. As such, investors should not consider any list of such factors to be an exhaustive statement of all risks and uncertainties or potentially inaccurate assumptions.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES



We have identified one policy area as critical to the understanding of our consolidated financial statements. The preparation of our consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of sales and expenses during the reporting periods. With respect to net realizable value of the Company's accounts receivable and inventories, significant estimation judgments are made and actual results could differ materially from these estimates.

The Company had not provided any reserves against its accounts receivable at December 31, 2004. In 2005, the management of the Company provided reserves on its accounts receivable to reflect management's expectation on the collectibility of aged accounts receivable. Management's estimation of the reserves on accounts receivable at September 30, 2005 was based on the current facts that there is significant aged accounts receivable. In making their judgment, management has assessed customers' ability to continue to pay their outstanding invoices timely, and whether their financial position will deteriorate significantly in the future, which would result in their inability to pay their debts to the Company. As at September 30, 2005, the Company provided $307,106 reserves for accounts receivable.

The Company had not provided any reserves against its inventories at December 31, 2004. At September 30, 2005, the Company provided $606,927 against its inventories, of which $131,551 was provided against the inventories of Three Happiness and $475,376 was provided against the inventories of HSPL. Management's estimation that a provision is needed is based on the current facts that there are potential impairments on the current carrying value of the inventories due to potential obsolescence as a result of aged inventories. The Company might not be able to realize the existing carrying value of the inventories. In making their judgment, management made their estimations on the potential impairments based on the demand for their products in the future and the trends of turnover of the inventories.

While the Company's management currently believes that there is little likelihood that the actual results of their current estimates will differ materially from such current estimates, if customer demand for its products decreases significantly in the near future, or if the financial position of its customers deteriorates in the near future, the Company could realize significant write downs for slow moving inventories or uncollectible accounts receivable.

We believe the following is among the most critical accounting policies that impact our consolidated financial statements. We suggest that our significant accounting policies, as described in our consolidated financial statements in the Summary of Significant Accounting Policies, be read in conjunction with this Management's Discussion and Analysis of Financial Condition and Results of Operations.

We recognize revenue in accordance with Staff Accounting Bulletin ("SAB") No.
104. All of the following criteria must exist in order for us to recognize revenue:

1. Persuasive evidence of an arrangement exists;
2. Delivery has occurred or services have been rendered;
3. The seller's price to the buyer is fixed or determinable; and
4. Collectibility is reasonably assured.

The majority of the Company's revenue results from sales contracts with distributors and revenues are generated upon the shipment of goods. The Company's pricing structure is fixed and there are no rebate or discount programs. Management conducts credit background checks for new customers as a means to reduce the subjectivity of assuring collectibility. Based on these factors, the Company believes that it can apply the provisions of SAB 104 with minimal subjectivity.

RESULTS OF OPERATIONS - THREE MONTHS ENDED SEPTEMBER 30, 2005 AS COMPARED TO
THREE MONTHS ENDED SEPTEMBER 30, 2004




Revenues, Cost of Revenues and Gross Margin
-------------------------------------------

Revenues for the quarter ended September 30, 2005 were $13,407,237, an increase
of $6,034,682 from $7,372,555 for the quarter ended September 30, 2004. Compared
to the same quarter in 2004, our sales revenues from our two main categories of
products in the current quarter of 2005 were as follows:


                                                            Three Months Ended September 30,
                                                   ----------------------------------------------         Increase /
Product                                                             2005                     2004         (Decrease)
---------------------------------------------      ---------------------     --------------------     ---------------
Plant based pharmaceuticals products (PBP
Products)                                          $          8,626,712      $         3,150,091      $    5,476,621
Plant based nutraceuticals products (PBN
Products)                                                     4,780,525                4,222,464             558,061

                                                   ---------------------     --------------------     ---------------
TOTAL                                              $         13,407,237      $         7,372,555      $    6,034,682
                                                   =====================     ====================     ===============

In the third quarter of 2005, the sales of our PBP Products increased by
$5,476,621 or 174% as compared to the same period in 2004. This was mainly due
to the increase in Cease Enuresis Soft Gel sales. Also, the acquisition of HSPL,
completed on November 22, 2004 contributed to an increase in sales of PBP
Products because HSPL produces and sells various types of PBP Products to the
market and through the acquisition of HSPL, AOB enriched its product mix on PBP
Products.

The sales revenue from our PBN Products increased to $4,780,525 in the third
quarter of 2005 from $4,222,464 from the same period in 2004, representing an
increase of 13%. In the third quarter of 2005, our marketing and promotion
efforts continued to help us to increase our sales in PBN Products.

Cost of revenues for the quarter ended September 30, 2005 were $4,911,990, an
increase of $2,475,833 from $2,436,157 for the same quarter last year. The
increases in costs of sales by product categories were as follows:

                                                             Three Months Ended September 30,
                                                   ----------------------------------------------         Increase /
Product                                                             2005                     2004         (Decrease)
---------------------------------------------      ---------------------     --------------------     ---------------

PBP Products                                       $          3,198,873      $           993,441      $    2,205,432
PBN Products                                                  1,713,117                1,442,716             270,401

                                                   ---------------------     --------------------     ---------------
TOTAL                                              $          4,911,990      $         2,436,157      $    2,475,833
                                                   =====================     ====================     ===============




The cost of sales of our PBP Products increased by $2,205,432, or 222% in third quarter of 2005 compared to same period in 2004. This increase resulted from our 174% increase in sales revenue from our PBP Products sold through Harbin Bioengineering in the same period as compared to last year and our sales of additional PBP Products resulting from our acquisition of HSPL completed on November 22, 2004. The cost of sales increased in higher proportion than our increase in revenue because the gross profit margin of HSPL was lower than that of Harbin Bioengineering and in the same quarter of 2004 the revenue and cost of sales of HSPL had not been consolidated into AOB.

The cost of sales of our PBN Products increased by $270,401, or 19% in the third quarter of 2005 compared to the same period in 2004. This increase resulted from our 13% increase in sales revenue from PBN Products during the third quarter of 2005 as compared to same period in 2004. The percentage increase in cost of sales was slightly higher than the percentage increase in sales revenue because of normal fluctuations in production overhead and spoilage during the production process.

Compared to the third quarter of 2004, the percentage profit margin for our Company decreased from 67% to 63% in the current quarter. The decrease in the percentage profit margin was mainly attributable to the average percentage profit margin of HSPL, which was lower than the average percentage profit margin of all products of Harbin Bioengineering. The profit margin for PBP Products decreased from 68% in the same quarter last year to 63% in current quarter. The decrease was due to the profit margin of PBP Products from HSPL, which was lower than the average profit margin of PBP Products from Three Happiness while in the same quarter last year the financial results of HSPL was not incorporated in AOB. For PBN Products, the profit margin decreased from 66% in the same quarter last year to 64% in current quarter. The decrease was due to normal fluctuations in production overhead and spoilage during the production process.


Selling and Marketing

Selling and marketing expenses amounted to $850,167 in the third quarter of
2005, an increase of $341,690 as compared to the same period in 2004 of
$508,477. The breakdown of the expenses were as follows:

                                                                            Three Months Ended September 30,
                                                                    -------------------------------------------------
                                                                                      2005                      2004
                                                                    -----------------------     ---------------------
Payroll expenses for Harbin Bioengineering                          $              160,648      $            138,531
Non payroll expenses for Harbin Bioengineering                                     285,686                   369,382
Payroll expenses for HSPL                                                           44,060                         0
Non payroll expenses HSPL                                                          352,970                         0
Overhead for offices in Hong Kong and the United States                              6,803                       564

                                                                    -----------------------     ---------------------
TOTAL                                                               $              850,167      $            508,477
                                                                    =======================     =====================




In the third quarter of 2005, the Company incurred $160,648 for the payroll of our sales and marketing executives and employees in Harbin Bioengineering, or an increase of 16% from $138,531 in the same quarter in 2004. This increase was mainly due to an increase in the number of employees in our sales and marketing department. In the third quarter of 2005, HSPL incurred $44,060 in payroll

expenses for sales and marketing executives and employees and $352,970 in overhead expenses. In the same quarter last year there was no such expense because operating results of HSPL was not yet consolidated with the Company. AOB also incurred $6,803 for sales and marketing activities in our Hong Kong and US offices, an increase of $6,239 from the same quarter last year.

Advertising



Advertising expenses for the quarter ended September 30, 2005 amounted to $756,541, an increase of 4% as compared with $728,802 in the same quarter in 2004. The Company spent roughly the same expenses in advertising in the current quarter compared to the same quarter last year.


General and Administrative
--------------------------

General and administrative expenses increased from $892,701 in the third quarter
of 2004 to $1,939,514 in the same quarter this year, or a 117% increase.
Compared to the same quarter in 2004, our increase in the expenses was due to
the following:


                                                                  Three Months Ended
                                                                     September 30,
                                                       ------------------------------------------         Increase /
Breakdown of expenses:                                                2005                   2004         (Decrease)
--------------------------------------------------     -------------------     ------------------     ---------------
Harbin Bioengineering - payroll                        $          121,266      $          89,932      $       31,334
Harbin Bioengineering - non payroll                               387,123                304,712              82,411
HSPL - payroll                                                     26,844                    - -              26,844
HSPL - non payroll                                                283,166                    - -             283,166
AOB Hong Kong office overhead                                     115,272                 44,974              70,298
AOB US office overhead                                             77,257                    - -              77,257
Professional fees                                                 595,128                    - -             595,128
Stock based consultant expenses                                   209,708                361,333            (151,625)
Executive compensation                                             91,750                 91,750                 - -
ESOP expense                                                       32,000                    - -              32,000

                                                       -------------------     ------------------     ---------------
TOTAL                                                  $        1,939,514      $         892,701      $    1,046,813
                                                       ===================     ==================     ===============




During the third quarter of 2005, the Company incurred $121,266 in payroll expenses for Harbin Bioengineering as compared to $89,932 in 2004. This increase resulted from an increase in the total number of employees. The non payroll expenses of Harbin Bioengineering increased by $82,411. This was mainly due to $131,551 reserves against inventories in the third quarter of 2005 that was not happened in the same quarter last year, offset by reduction in general overhead of $49,140 as a result of shift of portion of administrative activities to Hong Kong and US offices.

During the third quarter of 2005, HSPL incurred $26,844 and $283,166 of payroll and non payroll expenses, respectively. There were no similar expenditures in the same quarter of 2004 because the operation of HSPL was not consolidated with AOB in the same quarter last year.

The Company incurred $115,272 and $77,257 in overhead expenses for Hong Kong and US offices, respectively. In the same period last year the Company incurred a total of $44,974 to maintain the Hong Kong offices. The increase was due to increase in administrative activities in Hong Kong office and in the same quarter last year the US office was not established.

In the current quarter of 2005, the Company incurred professional expenses of $595,128 for professional expenses related to $6 million investments and related warrants administrations that did not occur in the same quarter last year.

The Company spent $32,000 in ESOP expenses in the current quarter and there was no ESOP expenses incurred in the same quarter last year. In the same quarter last year the Company did not issue any employee stock options to any of the directors.

Depreciation and Amortization



Depreciation and amortization of plant and equipment increased $164,648 in the third quarter of 2005 compared to the same period in 2004. The increase was mainly due to an increase in assets as a result of the HSPL acquisition.

Income Taxes



Income tax expense was $1,126,721 for the quarter ended September 30, 2005, as compared to $444,361 for the quarter ended September 30, 2004. The increase was due to the increase in income before income taxes of Harbin Bioengineering and the contribution of profit from HSPL, which could not be offset against the losses of AOB.

The income tax was provided at 15% of income before tax at the Harbin Bioengineering level and 33% at the HSPL level in China. The effective tax rate applied for tax expense in the current quarter, however, was 23% instead of 17% in 2004 (weighted average of the tax rate for Harbin Bioengineering and HSPL). This was because there were other operating expenses incurred at the holding company level as well as AOB HK and AOB US, and these expenses could not enjoy tax benefits in China and so the effective income tax rate provided for the Company was 23%.

Net Income



In the third quarter of 2005, our net income increased by $1,468,719 to a net income of $3,709,764 from a net income of $2,241,045 in the same quarter in 2004.

Foreign Currency Translation Gain



In the third quarter of 2005, we recognized foreign currency translation gain of $854,058 as a result of appreciation of Renminbi against US Dollar during July 2005. There was no such appreciation in the same quarter last year.


RESULTS OF OPERATIONS - NINE MONTHS ENDED SEPTEMBER 30, 2005 AS COMPARED TO NINE
--------------------------------------------------------------------------------
MONTHS ENDED SEPTEMBER 30, 2004
-------------------------------

Revenues, Cost of Revenues and Gross Margin
-------------------------------------------

Revenues for nine months ended September 30, 2005 were $34,962,489, an increase
of $15,679,355 from $19,283,134 for nine months ended September 30, 2004.
Compared to same period in 2004, our sales revenues from our two main categories
of products in the nine months ended 2005 were as follows:



                                                        Nine Months Ended September 30,
                                              ----------------------------------------------          Increase /
Product                                                        2005                     2004          (Decrease)
-----------------------------------------     ---------------------      -------------------     ----------------
PBP Products                                  $         22,052,419       $       10,403,812      $    11,648,607
PBN Products                                            12,910,070                8,879,322            4,030,748

                                              ---------------------      -------------------     ----------------
TOTAL                                         $         34,962,489       $       19,283,134      $    15,679,355
                                              =====================      ===================     ================

In the first nine months of 2005, the sales of PBP Products increased by
$11,648,607 or 112% as compared to the same period in 2004. This was mainly due
to the increase in Cease Enuresis Soft Gel sales by Harbin Bioengineering and
also to the increase in sales of PBP Products subsequent to the acquisition of
HSPL. HSPL contributed to an increase in sales of PBP Products because HSPL
produces and sells various types of PBP Products to the market and through
acquisition of HSPL, AOB enriched its product mix on PBP Products.

The sales revenue from our PBN Products increased to $12,910,070 in the first
nine months of 2005 from $8,879,322 from the same period in 2004, representing
an increase of 45%. In first nine months of 2005 our marketing and promotion
efforts continued to help us to increase our sales in health food supplements,
which resulted in an increase in sales.

Cost of revenues for the first nine months ended September 30, 2005 were
$12,728,309, an increase of $6,629,566 from $6,098,743 for the same period last
year. The increases in costs of sales by product categories were as follows:

                                                         Nine Months Ended September 30,
                                              ----------------------------------------------          Increase /
Product                                                        2005                     2004          (Decrease)
-----------------------------------------     ---------------------      -------------------     ----------------

PBP Products                                  $          8,184,755       $        3,168,688      $     5,016,067
PBN Products                                             4,543,554                2,930,055            1,613,499

                                              ---------------------      -------------------     ----------------
TOTAL                                         $         12,728,309       $        6,098,743      $     6,629,566
                                              =====================      ===================     ================




The cost of sales of our PBP Products increased by $5,016,067, or 158% in first nine months of 2005 compared to the same period in 2004. The increase resulted from our 112% increase in sales revenue from our PBP Products sold through Harbin Bioengineering in the same period as compared to last year and the increase in sales of PBP Products through HSPL subsequent to the acquisition.

The cost of sales of our PBN Products increased by $1,613,499, or 55% in the first nine months of 2005 compared to the same period in 2004. This increase resulted from our 45% increase in sales revenue from our PBN Products during the first nine months of 2005 as compared to same period in 2004. The percentage increase in cost of sales was higher than the percentage increase in sales revenue as in the same period of 2004 because the Company recorded exceptional higher profit margin of PBN products in the same period last year that did not repeated this year.

Compared to the first nine months of 2004, the percentage profit margin for our Company decreased from 68% to 64% in the same period of 2005. The decrease in percentage profit margin was mainly attributable to the percentage profit margin of HSPL was lower than the average percentage profit margin of all products of Harbin Bioengineering. The profit margin for PBP Products decreased from 70% in the period ended September 30 last year to 63% in same period in the current year. The decrease was due to the profit margin of PBP Products from HSPL was lower than the average profit margin of PBP Products from Three Happiness while in the same period last year the financial results of HSPL was not incorporated in AOB. For PBN Products, the profit margin decreased from 67% in the first nine month last year to 65% in same period in the current year. The decrease was due to normal fluctuations in production overhead and spoilage during the production process.


Selling and Marketing
---------------------

Selling and marketing expenses increased from $1,537,631 in the first nine
months of 2004 to $2,055,988 in the same period in 2005, representing a 34%
increase. The details of selling and marketing expenses for the first nine
months of 2005 and 2004 were as follow:

                                                             Nine Months Ended September 30,
                                                     -------------------------------------------------
                                                                       2005                      2004
                                                     -----------------------     ---------------------
Payroll expenses for Harbin Bioengineering           $              492,019      $            343,282
Non payroll expenses for Harbin Bioengineering                      917,985                 1,193,785
Payroll expenses for HSPL                                            82,219                       - -
Non payroll expenses HSPL                                           543,027                       - -
Overhead for offices in Hong Kong and US                             20,738                       564

                                                     -----------------------     ---------------------
TOTAL                                                $            2,055,988      $          1,537,631
                                                     =======================     =====================




In the first nine months of 2005, the Company incurred $492,019 for payroll expenses of our sales and marketing executives and employees in Harbin Bioengineering, or an increase of 43% from $343,282 in the same period in 2004. This increase was mainly due to an increase in the number of employees in our sales and marketing department. In the first nine months of 2005, HSPL incurred $82,219 in payroll expenses for sales and marketing executives and employees. In the same period last year there was no such expense in the Company because the operations of HSPL was not yet consolidated into the Company.

Despite the increase in our sales and marketing executives and employees, compared to the first nine months of 2004, Harbin Bioengineering has reduced its . . .

Thanks so much for your detailed reply Tokyopua.  I prefer to think of luck as knowing when to grasp an opportunity.  Thanks, especially to Michael for all his groundwork on this stock.  When I saw it at 5.4, I had the legwork done to purchase it.  I would not do this with an unknown stock since I have already caught more than my fair share of falling knives.

Have a GRRRRREAT DAY ALL !!!!

Se7en,

Thanks, I appreciate you posting the earnings and the linn.  I missed it on Yahoo, but its STILL not shown to me in my "portfolio news" on Etrade!!!  That is a serious issue for me, does anyone here have a reliable way to get real time news?  Or has anybody else had problems with Etrade news?  I dont want to have this happen again!

Picked up some shares at 5.81  :o

Thanks for the dip...i saw it coming sold last week 6.94

Quote from: ket1390 on November 14, 2005, 03:04:48 PM
Picked up some shares at 5.81  :o

Thanks for the dip...i saw it coming sold last week 6.94

Do you have a crystal bowl if you can see a 30% drop in less than 1/2 an hour coming a week from now???  ???

seven

aob seemed overbought the last days.....and i never hold through earnings after i got burned sometimes....so my tactic  with fast growing stocks is to sell 1-2 days before earnings especially after a good run like aob had...if i bought it at 1.50 sure i wouldn not have sold today....but i never hold long :)
And as you said earlier...sell the news is getting fashionable

Your picture on the side is that from the football club FC Brügge:) ?

Switzerland has to play in Istanbul this wednesday against Turkey....well we won 2:0 home. Should be enough hopefully...cheers :D

FC Brugge is called FCB, but my logo is from a far better team and they are also called FCB, FC Barcelona!!! :)
Yep, that was a very good and a bit of a surprising result against a strong Turkisch team, good luck for the return match!

http://biz.yahoo.com/bw/051114/20051114006105.html?.v=1


American Oriental Bioengineering Inc. Announces Record Revenues and Earnings for the Third Quarter of 2005
Monday November 14, 2:58 pm ET
Revenues Increase 81.9%
Net Income Increases 65.5%

HONG KONG--(BUSINESS WIRE)--Nov. 14, 2005--American Oriental Bioengineering Inc. (AMEX: AOB - News), an emerging Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, today announced financial results for the third quarter and nine-month period ended Sept. 30, 2005.

Key Financial Indicators
(all numbers for this table in thousands, except share and per-share
amounts)

                               Q3 2005     Q3 2004   Percentage Change

Consolidated revenues          $13,407     $7,373          81.9%
Cost of revenues               $4,912      $2,436         101.6%
Gross profit                   $8,495      $4,936          72.1%
Total operating expenses       $3,856      $2,284          68.9%
Income from operations         $4,639      $2,652          74.9%
Net Income                     $3,710      $2,241          65.5%
EPS - Basic                    $0.08       $0.07           14.3%
EPS - Diluted                  $0.08       $0.07           14.3%
Diluted shares                 44,076,235  33,594,477      31.2%

For the third quarter, the company announced revenues of $13.4 million, an increase of 81.9 percent compared to the $7.4 million reported for the third quarter of 2004. The increase in revenue was attributable to growth in the company's Plant-Based Pharmaceutical (PBP) and Plant-Based Nutraceutical (PBN) products, including the contribution of the Heilongjiang Songhuajiang Pharmaceutical Co. Ltd ("HSPL") acquisition completed in November 2004 which added the Shanghuangling Lyophilize Powder Injection to the company's PBP product line. Excluding the $4.3 million contribution from HSPL, organic revenues grew 23.8 percent for the third quarter of 2005 compared to the third quarter of 2004.

For the third quarter, PBP products comprised $8.6 million, or 64.3 percent of total sales, while PBN products comprised $4.8 million, or 35.7 percent of total sales. During the third quarter of 2005, the sales of PBP products increased approximately $5.5 million, or 173.9 percent compared to the same period in 2004, driven by the addition of the Shanghuangling Lyophilize Powder Injection to the company's PBP product line and growth in the company's Cease Enuresis Soft Gel sales, one of the few PBP approved by the Chinese government for the treatment of bedwetting and nighttime urination. Shanghuangling Lyophilize Powder Injection accounted for 49.6 percent of PBP revenue and the Cease Enuresis Soft Gel products contributed $3.0 million, representing 35.2 percent of total PBP revenues. Shanghuangling Lyophilize Powder Injection did not contribute to revenues during the third quarter 2004. Cease Enuresis Soft Gel products increased 61.2 percent for the third quarter of 2005 compared to the third quarter of 2004.

PBN sales increased by $558,061 or 13.2 percent compared to last year as the company continued to improve its marketing efforts geared toward educating consumers on the benefits of using soy-based peptide products. The company's largest product as a percentage of revenue for its PBN segment was the Peptide 1*100, which represented $3.1 million, or 65.5 percent, of revenues for this line.

Cost of goods sold was $4.9 million, an increase of 101.6 percent compared to the $2.4 million reported for the same period a year ago, resulting in gross margins of 63.4 percent for the third quarter of 2005 compared to gross margins of 67.0 percent for the third quarter last year. The company's gross margins were impacted by higher costs associated with manufacturing the HSPL product, which was not factored into the company's third quarter 2004 results.

Selling and marketing expenses increased 67.2 percent to $850,167, advertising expenses increased 3.8 percent to $756,541 and general and administrative expenses increased 117.3 percent to $1.9 million, in each case compared to the third quarter of 2004. Collectively, total operating expenses were $3.9 million, an increase of 68.9 percent compared to the $2.3 million reported for the same period last year as the company increased expenses related to the HSPL acquisition and other initiatives to support operational growth. Operating expenses as a percentage of sales were 28.8 percent during the third quarter of 2005 compared to 30.9 percent for the third quarter of 2004.

Operating income increased to $4.6 million, or 74.9 percent, from $2.7 million for the third quarter of 2004. Operating margin was 34.6 percent compared to 36.0 percent during the third quarter of 2004, with the decrease due to the integration of HSPL operations as mentioned previously.

Net income was $3.7 million, as compared to net income of $2.2 million for the third quarter last year, an increase of 65.5 percent. Basic and diluted earnings per share for the third quarter of 2005 were $0.08 per share, as compared to $0.07 per share for the third quarter of 2004. The company utilized 44.1 million weighted diluted shares in this calculation, representing a 31.2 percent increase from the 33.6 million weighted diluted shares for the third quarter of 2004.

"This was an exciting quarter for American Oriental Bioengineering as we achieved a listing on the American Stock Exchange, made significant improvements in our balance sheet, continued to integrate the acquired assets of HSPL while continuing our strong financial performance," commented Tony Liu, chairman and CEO of American Oriental Bioengineering. "During the third quarter, we continued to deliver solid revenue and earnings growth while further positioning AOBO to gain market share by expanding our geographic footprint and distribution channels. We made a strategic decision to expand the marketing of our PBN products and subsequently opened our first retail location in Hong Kong called 'Life Peptide.' This location will act as a showpiece to promote and educate consumers on the benefits of soy-based peptide products as a means to address improved overall health and well-being. Additionally, our soy-based peptide products will be offered in over 100 independent retail locations in the region. As we continue to penetrate the large and growing Chinese market with our superior products coupled with favorable macro demographic and product trends, we believe AOBO is well positioned for ongoing growth and profitability."

For the nine-month period ended Sept. 30, 2005, the company announced revenues of $35.0 million, an increase of 81.3 percent compared to the $19.3 million reported for the first nine months of 2004. The company's PBP products contributed $22.1 million in revenues, up 112 percent compared to the first nine months of 2004. For the nine months ended Sept. 30, 2005, $10.9 million of the revenue growth was contributed by SLPI, or 49.6 percent of total PBP revenues, and Cease-Enuresis Soft Gel products contributed $7.3 million, or 33.2 percent, of total PBP revenue, representing a 53.4 percent growth compared to the same nine-month period in 2004.

For the nine-month period ended Sept. 30, 2005, cost of goods sold was $12.7 million, an increase of 108.7 percent compared to the $6.1 million from the same period a year ago, resulting in gross margin of 63.6 percent for the first nine months of 2005 compared to gross margin of 68.4 percent for the same period last year, with gross margin decreasing due to the inclusion of HSPL products. Total operating expenses were $10.1 million, an increase of 42.5 percent compared to the $7.1 million reported for the same period last year. Operating expenses as a percentage of sales were 28.9 percent compared to 36.8 percent for the same period in 2004. Operating income was $12.1 million, an increase of 99.1 percent compared to $6.1 million reported in the same period. Operating margins were 34.7 percent, compared to 31.6 percent for the same period last year, as the company benefited from a faster rate of growth in sales compared to expenses. Net income was $9.2 million compared to net income of $5.0 million during the comparable period for 2004, an increase of 84.6 percent. Basic and diluted earnings per share were $0.22 per share compared to $0.15 per share for the nine-month period last year. The company utilized 41.3 million weighted diluted shares in the calculation compared to 33.1 million weighted diluted shares in the same period last year.

Balance Sheet

The company completed the quarter with $19.1 million in cash and cash equivalents, inclusive of the $11.0 million received from its class "A" and "B" warrants exercises by the end of September 2005. This compares to $11.4 million in cash as of Dec. 31, 2004. The company reported $3.7 million in bank loans as of Sept. 30, 2005, as compared to $5.1 million as of Dec. 31, 2004. During the first nine months of 2005 the company generated $3.9 million in positive cash flows from operations.

"Today, with over 100 products in our portfolio and over 10,000 points of sale, we believe we are a far stronger and more diverse company than just one year ago," Liu continued. "With a stronger cash position and a more defined and effective distribution channel, we are able to target multiple growth strategies in addition to having the resources available to capitalize on complementary acquisition opportunities within the Chinese marketplace. We are initiating plans to penetrate new markets and drive organic growth in terms of both revenue and earnings, while positioning ourselves as a recognizable entity in China for plant-based herbal remedies.

Teleconference Information

The company's management will host a third quarter earnings conference call today at 4:30 p.m. Eastern time today. Interested participants should call 888-896-0863 when calling within the United States or 973-582-2741 when calling internationally. There will be a playback available until Nov. 21, 2005. To listen to the playback, please call 877-519-4471 when calling within the United States or 973-341-3080 when calling internationally. Please use passcode 6684462 for the replay.

This call is being webcast by ViaVid Broadcasting and can be accessed at American Oriental Bioengineering's Web site at http://www.bioaobo.com. The webcast may also be accessed at ViaVid's Web site at http://www.viavid.net. The webcast can be accessed until Dec. 14, 2005, on either site.

About American Oriental Bioengineering Inc.

American Oriental Bioengineering Inc. (AOB) uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications. AOB also produces Cease-Enuresis Soft Gel, one of the few Chinese FDA-approved first grade, prescription medicines that is specially formulated to help alleviate bed-wetting and incontinence. The company is a leading producer of products in both the pharmaceuticals and nutraceuticals areas in China. For more information, visit http://www.bioaobo.com.

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in statements filed from time to time with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

        American Oriental Bioegineering Inc. and Subsidiaries
                Condensed Consolidated Balance Sheets
                                ASSETS
                                ------
                                                SEPT. 30,    DEC. 31,
                                                  2005        2004
                                               ----------- -----------
                                               (UNAUDITED)
CURRENT ASSETS
Cash and cash equivalents                     $19,074,261 $11,404,149
Accounts receivable, net of allowance for
doubtful accounts of $307,106 and $0,
respectively                                   7,691,130   4,736,901
Inventories, net of provision of $606,927
and $0, respectively                          10,506,880   5,673,059
Advances to suppliers                             520,884     518,589
Other receivables                                  14,210     156,062
Prepaid expenses                                  138,400           -
Due from employees                                410,808     182,099
Deferred consulting expenses                      962,328   1,686,652
                                               ----------- -----------
      Total Current Assets                     39,318,901  24,357,511

PLANT AND EQUIPMENT, NET                        7,766,247   8,068,776
DEFERRED TAX ASSETS                               581,227     159,958
LICENSE, NET                                      486,592     542,168
CONSTRUCTION IN PROGRESS                        6,481,073   1,836,714
LAND USE RIGHTS, NET                            7,950,592   7,871,497
                                               ----------- -----------
    TOTAL ASSETS                              $62,584,632 $42,836,624
    ------------                               =========== ===========

                 LIABILITIES AND SHAREHOLDERS' EQUITY
                 ------------------------------------
CURRENT LIABILITIES
Accounts payable                              $ 1,407,773     755,266
Short-term bank loans                           3,707,365   5,060,241
Common stock to be issued                       2,780,328           -
Taxes payable                                   1,231,258   1,096,545
Other payables and accrued expenses             1,434,031   1,064,411
Due to officers                                         -   1,404,522
Customer deposits                                 302,054     160,504
Current portion of obligations under capital
leases                                            13,577      12,952
                                               ----------- -----------
Total current liabilities                      10,876,386   9,554,441

LONG-TERM PORTION OF OBLIGATIONS UNDER CAPITAL
LEASES                                            23,528      34,548
DEFERRED TAX LIABILITIES                          210,885     107,201
                                               ----------- -----------
TOTAL LIABILITIES                              11,110,799   9,696,190
                                               ----------- -----------

SHAREHOLDERS' EQUITY
Preferred stock, $0.001 par value; 2,000,000
shares authorized; 1,000,000 shares issued
and outstanding at Sept. 30, 2005, and
Dec. 31, 2004, respectively                        1,000       1,000
Common stock, $0.001 par value; 60,000,000
shares authorized; 48,264,739 and 39,746,827
shares issued and outstanding, respectively       48,265      39,747
Additional paid-in capital                     25,122,455  16,900,303
Accumulated other comprehensive income            854,058           -
Retained earnings (the restricted portion of
retained earnings is $1,294,689 and
$1,294,689 at Sept. 30, 2005, and Dec. 31,
2004, respectively)                           25,448,055  16,199,384
                                               ----------- -----------
Total Shareholders' Equity                     51,473,833  33,140,434
                                               ----------- -----------
   TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $62,584,632 $42,836,624
   ------------------------------------------  =========== ===========


        AMERICAN ORIENTAL BIOENGINEERING INC. AND SUBSIDIARIES
             CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                             (UNAUDITED)

                        Three Months Ended       Nine Months Ended
                             Sept. 30,               Sept. 30,
                         2005        2004        2005         2004
                      ----------- ----------- ------------ -----------

REVENUES             $13,407,237 $ 7,372,555 $ 34,962,489 $19,283,134
COST OF GOODS SOLD    (4,911,990) (2,436,157) (12,728,309) (6,098,743)
                      ----------- ----------- ------------ -----------
GROSS PROFIT           8,495,247   4,936,398   22,234,180  13,184,391

Selling and marketing   (850,167)   (508,477)  (2,055,988) (1,537,631)
Advertising             (756,541)   (728,802)  (2,160,625) (2,336,006)
General and
administrative       (1,939,514)   (892,701)  (4,968,708) (2,757,745)
Merger cost                    -      (8,333)           -     (24,999)
Depreciation and
amortization           (310,267)   (145,619)    (919,195)   (436,674)
                      ----------- ----------- ------------ -----------
INCOME FROM
OPERATIONS            4,638,758   2,652,466   12,129,664   6,091,336

INTEREST INCOME
(EXPENSE), NET          197,150     (23,694)      40,074     (71,485)

OTHER INCOME, NET            577      56,634       (6,700)     83,376

                      ----------- ----------- ------------ -----------
INCOME BEFORE INCOME
TAXES                 4,836,485   2,685,406   12,163,038   6,103,227
Income Taxes          (1,126,721)   (444,361)  (2,914,367) (1,094,394)
                      ----------- ----------- ------------ -----------

NET INCOME             3,709,764   2,241,045    9,248,671   5,008,833

Foreign currency
translation gain        854,058           -      854,058           -

                      ----------- ----------- ------------ -----------
COMPREHENSIVE INCOME $ 4,563,822 $ 2,241,045 $ 10,102,729 $ 5,008,833
--------------------  =========== =========== ============ ===========

NET INCOME PER SHARE
          BASIC      $      0.08 $      0.07 $       0.22 $      0.15
          DILUTED    $      0.08 $      0.07 $       0.22 $      0.15

WEIGHTED AVERAGE
NUMBER OF SHARES
OUTSTANDING
         BASIC        44,000,009  33,570,957   41,239,172  33,073,499
         DILUTED      44,076,235  33,594,477   41,267,329  33,097,224

I guess I was lucky checking my computer at the right time. Got back in at $5.43, after selling last Thurs. at pre-market $7.45.

I am long term holder of AOB, but did't like the steep run-up prior to the earnings so I sold. I held my other holding HOM through earning today with a 9% gain. HOM didn't have as steep run-up as AOB prior to earning and it turned to to be the right decisions.


-Valueseeker

Can someone give some TA after today's 'hurricane'?! ::)

Quote from: Se7en on November 14, 2005, 07:51:34 PM
Can someone give some TA after today's 'hurricane'?! ::)

i took some profits but decided to hold some over earnings... ok, bad move.

any suggestions on what to do with the remainder? I can just bail now, but it cuts into my initial profits so....

I sold this morning at 6.26$ ...

I sold yesterday at 6.15 in order to spend some time to better understand the CC and results.  I didnt finish so was out still this morning and was wishing I held for awhile there, but now its down again, so again I am probably lucky. 

I am going to cointinue to sit this out for awhile, maybe play the next end of quarter if the stock languishes in the meantime, or buy on a major pullback if it happens before end of quarter.

well the profit taking seems to have levelled off. Looks like we might get out of this without getting scathed too much.

AOB:
Revenues Increase 81.9% !
Net Income Increases 65.5% !

Momentum players give chance to buy lower

Bought more today  :D (averaged to 5.85)

1. Fast stockastics is low...when bought at this level was always good see past
2. RSI should hold 50...
3. uptrend intact

got in at $5.85 today...

kinda waited for the "negative" news (heck, I don't see anything negative with it!) to sink in, and also the profit takers and the bottom fishers to manipulte the stocks for a while...looks like the mid-to-upper 5's is where the stability is maximum today.

Looking for a slow but steady rise back to the 7's over the next few days, especially once the marke recognizes it's "miscalcualtion" on the understanding of yesterday's tremendous results.

good luck all.  ;)

$7 levels in the next few days? that would be great but seems a little optimistic. it may take to the end of the month since we've also got a holiday in there.

5 day chart  ;)

another day of sideways action. after taking some profits, i'm still holding a few shares. does it seem like we'll continue sideways for a while?

just time to move on?


thanks.

I had a drill sergeant that used to tell us to stop the madness. ;)  I'm holding onto AOB for now.  The stock is still bullish and has formed a small symmetrical triangle since it tanked a few days ago.  Once consolidation finishes, this should start moving up again.  We'll have to see which way it decides to break from the triangle or if it wants to continue this sideways trend.

Quote from: basonista on November 17, 2005, 02:18:38 PM
I had a drill sergeant that used to tell us to stop the madness. ;)  I'm holding onto AOB for now.  The stock is still bullish and has formed a small symmetrical triangle since it tanked a few days ago.  Once consolidation finishes, this should start moving up again.  We'll have to see which way it decides to break from the triangle or if it wants to continue this sideways trend.

1. i think we know which way it want to break now...

2. i think we need your drill sergeant to get this stock back in shape!

Hi,

Based on 5'days' chart, I think it is going up next Mon. or Tue..
let's pray.

Quote from: stopthemadness on November 18, 2005, 12:22:32 PM

Quote from: basonista on November 17, 2005, 02:18:38 PM
I had a drill sergeant that used to tell us to stop the madness. ;)  I'm holding onto AOB for now.  The stock is still bullish and has formed a small symmetrical triangle since it tanked a few days ago.  Once consolidation finishes, this should start moving up again.  We'll have to see which way it decides to break from the triangle or if it wants to continue this sideways trend.

1. i think we know which way it want to break now...

2. i think we need your drill sergeant to get this stock back in shape!

I guess it could have been worse (famous last words).  We are still above the longterm trendline that has been solid support for AOB for almost 6 months.  This trendline will stand at about $5.75 to $5.80 on Monday.  That has been such solid support that my plan is to sell if AOB is set to close below it.  I may even sell on a break of the trendline intraday if I'm watching at that time.  I have come to distrust some of these Chinese bio/pharma so I feel it is better for me to limit my losses.  If this breaks the trendline, even intraday, then a TL that has held for 6 months will no longer be valid for my trade plan.  With earnings as good as they were, and the bounce off support on Black Monday, I feel that it is only a matter of time before this moves higher again.  I agree with huhhot that we will probably see it on Monday or Tuesday.  I guess we will have to see it early next week since there isn't much room for AOB to decide to either honor the TL or violate it.

Basonista :

Thank you for the wonderful charts. I totally agree with your opinion. I think it is still good to hold for the long-term.

Huhhot

Quote from: huhhot12345 on November 18, 2005, 05:22:37 PM
Hi,

Based on 5'days' chart, I think it is going up next Mon. or Tue..
let's pray.

Damn. i hate relying on praying.

I agree with long term look for AOB as institutions are still holding tight.
http://moneycentral.msn.com/investor/invsub/ownership/ownership.asp?Symbol=AOB

I dont know what happened just now, but AOB dipped.  I bought back in at 5.59.  Its at 5.55 now, but at this discount I think I am getting a good bargain longer term.  Unless there is some other catalyst that I dont know about for the price dropping, but I didnt see any news...

i'm still holding some AOB. the profits i took earlier are dwindling now.

it's wierd that there seems to be a number of sudden drops in th pps with sudden increases in volume too.

at least it seems to be holding steady right now.

Long term, I like AOB, but it is ahead of itself.  It was a buck and little change less than 6 months ago.  There are significant profits for many people, some of whom will take those off the table.  The "trendline" cannot continue ... this is not a double digit stock for awhile fundamentally.  The 200 day moving average is a little over $3 (about 3.15) and it is somewhere south of the $5.50 today that it is safe to buy.  If this stock had gone from $1.25 to $3.15 in less than six months, all holders would be thrillled for the ride.  Cramer is an idiot ... but hogs do get slaughtered.  :P  Be patient.  Buy lower.... 

My prediction for AOB...

AOB is currently shaping an upsloping channel. The bottom of the channel appears to be the 50 day MA (5.25) However, with the recent spike to 7.50ish and the HUGE volume sell off I would expect AOB to come into support with a full head of steam.. (downward momentum) Furthermore if you look at the thicker blue lines AOB has also dropped more rapidly that the first sell off wave. Factoring in these concepts and that of a "measured move" I would expect AOB to temporarily break the 50 day ma.

I would be interested in the stock from 4.90-5.10 as shown by the 2nd support line on the chart below... all things equal (fundamentals unchanged) >:D

In at 5.30 - I also expect it to dip under the 50 MA, slightly, but I'm not sure enough to wait and miss this buy in price.

My position today is a third of what I took profits on last week.  I seem to have bought too early today, but intend to average down if AOB goes lower.  Anything below $5 will be a steal for this stock given its growth rate, and in particular the historically strong Q4 revenues.

The 2 numbers I looked at were the 50 DMA (I show $5.26 on Stockcharts) and the 38% retracement level ($4.76 off the Nov. 14 high of $7.68).

The buying volume surged twice late day when it touched 5.30 so feeling comfortable with that for the time being (That time being now and market close tomorrow)

As Calvern pointed out, though, this could easily slip another 10%.
In the bigger picture, I'm sure it's headed north, just don't know if I picked the bottom or not to get in.

AOB: Short Interest UP 33.3% to 385.8K in Nov 2005

Monday , November 21, 2005 16:15 ET

According to new short interest data from AMEX, short interest for American Oriental Bioengineering Inc (AMEX: AOB) INCREASED 33.3% to 385,759 shares for the month ended mid-November, 2005.

SYMBOL       OCTOBER     NOVEMBER        CHANGE       %CHANGE  DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
AOB              289,320         385,759         +96,439       +33.33%           1
Based on AOB's 20-day average daily share volume of 2,712,235, it would require approximately 1 day(s) of buying to cover this short interest.

nice to see AOB hit $6 again. i didn't think it would happen this month... but then it's a very green day all around.

i think based on the close and tomorrows opening, i might just sell the rest of my position and move on.

Yeah, I went ahead and sold today at 5.98 after holding just a day.  I expected I would have to average down but AOB suprised me with a nice gain, and I will take it.  I will keep buying for sure if it keeps getting discounted.  Still a great stock long term IMO. 

i came across a post about AOB on another board on the yahoo MB.  the person was "pumping" that AOB was going to do "well" next week.

total pump?

is there rumblings about things?

thanks

These sh!ts just did a secondary offering.  The stock is plumeting.  They suck.

http://biz.yahoo.com/bwml/051123/235423.html?.v=1

WOW!!! WTF
YOU WOULD NOT BELEIVE THIS, but i was happy at it at 6.15 so i put in a sale order so i could buy another stock. I WAS SURE IT WAS GOING TO GO UP but i had a gut feeling.  When my order did not take i looked at ameritrade showing 5.00  and thought it was a mistake.  So nice gut feeling, just seconds too late.  WOW that is 2wice AOB has burned me in 7 days. 

Yup, I agree.  Stupid idiots.  It triggered my stop, so i'm out at $4.90.  I still made some profit, but it hurt to see $4000 disappear in a few minutes.

NEW YORK (Dow Jones)--American Oriental Bioengineering Inc. (AOB) priced a 12.5 million-share private placement at $4.80 a share, well below the company's price before its stock was halted Wednesday afternoon.
  The company's shares are halted and last listed a price of $6.14.
Resumed trading shortly, and triggered my stop.

Brigitte

Man, I thought my stocks were having a bad day! :o

Same freakin boat for me too >:D >:D >:D
Can anyone explain to me what happens with a stock placement like this, and why they halt the price, freezing all trades, forcing everyone holding to take such a hit.  It didn't even seem like you could trade out of the drop.

How does a thing like this work???

Why don't they make the offering at the current price?  WWould make sense - more money for them.

And just when I thought AOB was recovering....

Quote from: LuckyFish on November 23, 2005, 03:28:55 PM
Yup, I agree.  Stupid idiots.  It triggered my stop, so i'm out at $4.90.  I still made some profit, but it hurt to see $4000 disappear in a few minutes.

Hi Brigitte,

Good to see that you still had a good trade. I personally don't use stop/loss. I don't think it works unless you keep it very tight (update every day).

The private placement today was indeed a surprise but I don't think these guys are stupid. Consider it a riddle. AOB's balance is loaded with cash so if they are selling shares they must have a reason. Today they gave the first clue (which is that they need $60 million) they have still not told us to what. My guess is that there are some privatizations coming up and they want to be in a position to take advantage of it. These deals are always surrounded by secrecy, which might be why they only gave us a clue, but I wouldn't be surprised if AOB is trading higher than before the announcement a couple of month from today.

This is obviously only speculations. They might also sell shares to buy a yacht to the Chairman but.....

Mike

Quote from: stopthemadness on November 23, 2005, 11:31:51 AM
i came across a post about AOB on another board on the yahoo MB.  the person was "pumping" that AOB was going to do "well" next week.

total pump?

is there rumblings about things?

thanks

stopthemadness,

I guess I would have to see what they were talking about, but somehow it looks like AOB is going to get pegged to the $4.80 range for awhile. 

http://biz.yahoo.com/e/051123/aob8-k.html

As $6M divided by 12,500,000 shares will be $4.80.  And here I was thinking I should have held the stock longer than a day because I had seen it hit $6.30, I guess I got out lucky after all again.  OTOH, the stock did go up today to $5.16, so maybe it wont be pegged to $4.80?

I will say that AOB is a bit tricky because they had outstanding warrants in September that I didnt know about when I was holding it long term at a buy in of $5.26, and the selling of the expiring warrants sent the stock to $3.50.

Now it looks like they are diluting the stock, and doing it at a low price.  At least when NVAX diluted recently it was around the price the stock was trading at during that time.  I dislike dillution at lower prices.

On the other hand, maybe that is the last of it, and next week will be a rebound?  Anyway, I doubt people on the boards have much proprietary info as this is a chinese stock.  Still, if you remember where you found the message, I would be interested to take a look. 

I think I would have bought at $4.80 for sure given the news, but need to think about my next reentry.

Let's see, those people paid for $60M probably have a lot more information than we did. Friday's close is merely 7.5% higher than their price at $4.8. So our downside is pretty limited now, while the upside is still $7.84 with PE=16 at forward earning of $0.49. The picture will dramatically change when they announce acquisition with accretive earnings.

Well, I am back in again now here well under $5, hopefully any downside is limited to $4.8 as we are guessing.  The stock is now cheaper than when I bought my initial positions months ago, didnt think I would get this chance anytime soon.  I will even average down at this point if it does go a bit lower.

   tokyopua,

    I am with you. I have read their reports and looks last time they had a private placement is was to acquire a company i can't pronounce. I think they are focusing hard on expanding and growth potential. Looking at the numbers and i could be off but even with the dilution of the shares their P/E is still around 28, that is not outrageous. i will looking to purchase more around the 4.80s level also. The people not happy with this are the short termers looking for a quick buck. GL

Quote from: la-onda on November 22, 2005, 05:05:01 AM
AOB: Short Interest UP 33.3% to 385.8K in Nov 2005

Monday , November 21, 2005 16:15 ET

According to new short interest data from AMEX, short interest for American Oriental Bioengineering Inc (AMEX: AOB) INCREASED 33.3% to 385,759 shares for the month ended mid-November, 2005.

SYMBOL       OCTOBER     NOVEMBER        CHANGE       %CHANGE  DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
AOB              289,320         385,759         +96,439       +33.33%           1
Based on AOB's 20-day average daily share volume of 2,712,235, it would require approximately 1 day(s) of buying to cover this short interest.

La-onda,

I noticed you follow short interest a lot, and it seems you made a killing in TIII today based partly on that (wish I had held too!!!).  So what is your take on AOB and the short interest now in light of the recent private placement, the current price drop, etc.?

I have bought some AOB shares yesterday, agreeing with Michaels last comments

8)

Looks like my analysis was fairly accurate... >:D

http://www.3stocksonfire.org/trading/index.php?topic=3480.msg34278#msg34278

Exactly Calven...  :D ;D ... feels like i want to get back into AOB again... i can feel the rebound is just around the corner.. watch AOB folks!!  ;) :D ;D

CHART 2:

Well, I just averaged down a bit here with 1000 more shares at 4.60, wish I had caught the dip at 4.50.  I dont know what happened, but there was no bad news that I could see, so it seemed OK to buy.

never average down in the stock market! this might head to 3.70

http://www.stockta.com/cgi-bin/analysis.pl?symb=AOB&num1=1&cobrand=&mode=stock

I think I found the reason for the current drop:

http://msnbc.msn.com/id/10251542/

A similar thing happened to NVAX about 3 weeks ago off a Motley Fool article, which also cited Vertex.  Basically its a pattern that Motley Fool does, they find one biotech stock to be the bad guy, then they compare to their shining pick, Vertex.

This article above was a bit more unique, but in the case of the one they published with NVAX as the "bad guy" stock, the Yahoo MB folks found the SAME article had been published 4 times, only thing that changed each time was the name of the "bad guy" stock.  It was some drivel about how the authors friend had steered his daughter's investments away from stocks like NVAX and towards stocks like Vertex.  Then the "funny" twist is that his daughter is a toddler, blah blah...

Anyway, I am not too worried about the stock hitting 3.70 or whatever the stockta support shows, the last time it did, I rode it right back to sell it at 7.20, I am prepared to ride this out again.

Quote from: bigdogs99999 on November 21, 2005, 12:04:19 PM
Long term, I like AOB, but it is ahead of itself.  It was a buck and little change less than 6 months ago.  There are significant profits for many people, some of whom will take those off the table.  The "trendline" cannot continue ... this is not a double digit stock for awhile fundamentally.  The 200 day moving average is a little over $3 (about 3.15) and it is somewhere south of the $5.50 today that it is safe to buy.  If this stock had gone from $1.25 to $3.15 in less than six months, all holders would be thrillled for the ride.  Cramer is an idiot ... but hogs do get slaughtered.  :P  Be patient.  Buy lower.... 

I love quoting myself.   :D  The 200 day moving average is now up to $3.40ish and the 100 is a bit over $4.  The company is not really a biotech if one looks at their product line, it is a consumer product company in over the counter "health" products.  Below is a description of a lead product.  Again, patience!!!  Why does everyone think that something that was $1 six months ago will necessarily continue the rocket up?   ??? 

From AOB's website:

SoyPeptide Beverage
The product contains Soybean Peptide which is extracted from the Soy Protein Isolate through enzyme reaction, is composed of 3 to 6 amino acid with molecular weight less than 1,000d. Peptide is absorbed and digested by our body more directly than amino acid, is low in sensitivity and zero in cholesterol that is good to health. It also consists of complete plant protein, rich in 9 kinds of essential amino acids that make rapid recovery of energy, as well as accelerating the power of brain. Further, it is also good for energy metabolism. This product is added with soybean peptide and condensed ribes nigrum, which is rich in vitamins and minerals, is very good to our health.
It is best as beverage and a substitute of drinking water.
[Ingredients]Purely filtrated water, Sugar, Fructose, Condensed ribes nigrum, Soybean peptide, Malic acid,Citric acid, Sodium citrate, SodiumCurboxymethl cellulose, Iso-vitamin C, Asipatan, Dietary flavour

Back in again at 4.45....hope the downturn has settled :)

I'm back in also @$4.41, hopefully this will head north :)

I have not take a position yet i'm still closely watching & waiting ... i bought NVAX today though ;)

nice summarization:
Thursday, December 01, 2005

American Oriental Bioengineering (AOB:AMEX) (11-30-05 Closing Price $4.43 USD) Strong Buy - 12-month target price: $8.19. Part 1 of 2.

Overview:
Every now and then, the market gives us some gifts. Chances to get in on stocks in great companies at greatly discounted prices. Right now that is what is happening in American Oriental Bioengineering right now. These opportunities are often short lived, and it is imperative that we take advantage of them. That is why I am delaying my report on Sunwin International Nutraceuticals (SUWN.otcbb) and I am instead issuing a strong buy recommendation on American Oriental Bioengineering.

Fundamental Quantitative Analysis:

antitative Analysis:There are so many reasons to like American Oriental Bioengineering, in fact if there were a single Chinese stock out there that I would recommend, it would be American Oriental Bioengineering. American Oriental Bioengineering has been a major story of the summer, a story which has started to turn heads on wallstreet just a little bit. AOB hit a 52-week low back in May, $1.02, at that point people seemed to realize that here you had a company which between years of 2002-2004 had a record of increasing revenues from $10.2 million for the full year 2002, to 32.0 million in 2004, an increase of 213% in 2 years.

The company has diluted the share pool over this 2-year period, EPS growth is more modest but still astounding. EPS grew from 0.106 to 0.231, this represents at 118% increase in EPS for the period, or a compound annual growth rate of 48%. This is an amazing story of value creation. Let us assume that they can maintain this growth, this would imply that if their P/E ratio remains static, that you will get a 48% return on investment. This high rate of growth makes AOB very attractive to growth oriented investors.

Value investors should also find AOB to be a very attractive buy. There is only one analyst covering the stock, William Lyons of Westminster Securities. He estimates earnings at $15,400,000 for the year. Including the dilution of the recent private placement, AOB will have 56.5 million shares outstanding, there are also 3.83 million warrants outstanding (60.3 million diluted). This puts EPS at $0.273 cents per share ($0.255 diluted), and at yesterday's closing price of 4.43, represents a forward 2005 P/E ratio of 16.23 (17.37 diluted). While this is by no means the same bargain it was back at $1.02, this company is still selling for cheap. Consider the following, as of July 29, 2005, the P/E of the S&P 500 was 20.26, according to analyst estimates this represents a forward 2005 P/E ratio of 18.06. These figures were taken from the Standard and Poor's website. The growth of the S&P earnings may break double-digits this year, but will not be more than 15%, yet it is trading at a forward P/E premium compared to a company with excellent management and a significantly higher growth rate. This does not make sense, and I consider AOB to be significantly undervalued.

AOB is one of the premier Chinese stocks being traded on US exchanges today, in terms of Chinese small caps it is one of the blue chips. As such, AOB is dual listed on the American Stock Exchange and the Pacific Stock Exchange and its Arca-Ex affiliate. Its options are also traded on the Pacific stock exchange, though they are quite expensive, and I'd much rather just own the stock. Pursuant to listing on these exchanges, AOB has more stringent corporate governance standards than many Chinese companies listed on other exchanges.

AOB is starting to be noticed by more institutional investors. The recent private placement is evidence of this. AOB raised $60 million dollars by issuing 12.5 million units at $4.80, each unit represents 1 share and 3/10 of a warrant exercisable at $6.50. A fringe benefit of this deal is that institutional investors will own approximately 22% of the company, these stronger hands may decrease the downside volatility somewhat. Going forward AOB will be flush with cash. They will have cash and cash equivalents of $71 million dollars. With 56.5 million shares outstanding after the completion of the PP, this implies cash and cash equivalents per share of $1.25. They will further increase their cash levels if and when the warrants are exercised. So far the company's strong management has been able to execute on their acquisition strategy, and have significantly increased shareholder value. They have pursued strategic acquisitions such as the purchase of a company with a national distribution network, which has allowed AOB to market their products to a huge number of consumers. The environment is China is such that a company like AOB can buy companies at or even slightly below book value. The cash that they possess will allow them to pursue a policy of accretive acquisitions going forward.

The valuation for this stock is extremely cheap considering its premium management team and history. This stock should be valued at a significantly higher multiple. I would use a forward 2005 P/E of 30 in estimating a target price. The company's current impressive growth rate, coupled with proven management, strong cash position and massive market potential justify this P/E ratio. I am initiating coverage at 4.43 with an opinion of Strong Buy and a 12-month target price of 8.19, representing an upside of 85%. Check back over the next few days for more analysis of AOB.

http://harbinus.blogspot.com/2005/12/american-oriental-bioengineering.html


still invested  8)

Nice article!!

I'm still in too, and sweating it a little bit.  Made some profit on the last run-up and bought back in at 6.80 - missed the key sell signals as I haven't been around too much and now find myself over 30% in the hole!!  Today's action wasn't encouraging either, and this kind of encouragement is exactly what I need.  I made the mistake of selling out of my loss on SVA, only to see it hit crazy lows and rebound.  Don't want to make that mistake again with AOB, and will hold for brighter days...

Well, here's hoping ;)

Well, looks like a lot of us have taken a bit of a beating recently here.  I am probalby grasping at straws here, but here is my meager hope for a reversal:

http://stockcharts.com/def/servlet/SC.web?c=aob

We got a Black Spinning Top candlestick today:

"If a Black Spinning Top is observed after a long decline or a long black candlestick, this implies weakness among the bears and it is a warning about a potential change or interruption in trend."

http://www.candlesticker.com/Cs06.asp

Its not a strong reliability indicator, but nonetheless, GLTA of us still holding.

Quote from: la-onda on December 01, 2005, 02:01:43 PM

AOB is starting to be noticed by more institutional investors. The recent private placement is evidence of this. AOB raised $60 million dollars by issuing 12.5 million units at $4.80, each unit represents 1 share and 3/10 of a warrant exercisable at $6.50. A fringe benefit of this deal is that institutional investors will own approximately 22% of the company, these stronger hands may decrease the downside volatility somewhat. Going forward AOB will be flush with cash. They will have cash and cash equivalents of $71 million dollars. With 56.5 million shares outstanding after the completion of the PP, this implies cash and cash equivalents per share of $1.25. They will further increase their cash levels if and when the warrants are exercised. So far the company's strong management has been able to execute on their acquisition strategy, and have significantly increased shareholder value. They have pursued strategic acquisitions such as the purchase of a company with a national distribution network, which has allowed AOB to market their products to a huge number of consumers. The environment is China is such that a company like AOB can buy companies at or even slightly below book value. The cash that they possess will allow them to pursue a policy of accretive acquisitions going forward.

La-onda,

Good find, thanks for posting it.

I noticed yesterday that these drops have brought out the first ever institutional investor Buy signals that I have seen yet for AOB on Lycos I watch, so I agree with the above sentiment. 

http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=AOB&range=30&mgp=0&hdate=&x=9&y=12

As you can see, its only recently this started when the price dropped. 

it will hit this trendline i think....so a good entry is around 4.00 +/-

another summarization:
Full Transcript of the Prepared Remarks From American Oriental Bioengineering's Q3 Conference Call (AOB)

Here's the full text of the prepared remarks from American Oriental Bioengineering's (ticker: AOB) Q3 conference call:

    American Oriental Bioengineering, Inc.
    Third Quarter 2005 Earnings Conference Call
    November 14, 2005

    Operator: Good afternoon, ladies and gentlemen, and welcome to the American Oriental Bioengineering Third Quarter 2005 Earnings Conference Call. At this time, all lines have been placed on a listen-only mode for the duration of today's conference. It is now my pleasure to turn the floor over to Hayden Communications to read the introductory statement.

    Chris Donnelly: Thank you, and welcome everyone to the first earnings conference call for American Oriental Bioengineering. Today we will be discussing the 2005 Third Quarter Financial results. Today's press release announcing these results has been posted to the appropriate news wires. On the call today is Mr. Tony Liu, Chairman and CEO of AOBO, as well as Miss Lily Li, COO and acting CFO, who are both with us today. For simplicity, all percentages will be rounded to the nearest percent. Today's call will be a presentation by management and will not include a Q&A session. Given that Tony and Lily are not in the same office and that there are some language barriers, we believe that it is in the best interest of time to utilize this format. We do plan to incorporate a Q&A allocation for future quarterly calls. In addition, please feel free to contact Hayden Communications at (843) 272-4653 with any investor related questions on a go-forward basis.

    Before we get started, I'd like to read a cautionary statement about forward-looking information. The presentation may contain, in addition to historical information, forward-looking statements within the meaning of Federal Securities laws regarding American Oriental Bioengineering. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are other than statements of historical fact. These forwardlooking statements are based on current management expectations and are subject to risk and uncertainties that may result in expectations not being realized and may cause some actual outcomes to differ materially from expectations reflected in forward-looking statements. Potential risks and uncertainties include product and service demand acceptance, changes in technology or economic conditions, the impact of competition and pricing, the impact of government regulation, and other risks contained in statements filed from time to time with the Securities and Exchange Commission. All forward-looking statements, whether written or oral and whether made by or on behalf of the Company, are expressively qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statement. In addition, the Company disclaims any obligation to update any forward-looking statement to reflect events or circumstances after the date thereof. Because forwardlooking statements are subject to risks and uncertainties, we caution you not to place undue reliance on any forward-looking statements. Forward-looking statements made during the presentation speak only as of the date of this presentation. All written or oral forward-looking statements by AOBO or persons acting on behalf are qualified by these cautionary statements.

    With that out of the way, I'll turn the call over to Hong, who will speak on behalf of Mr. Tony Liu, Chairman and CEO. Hong?

    Hong: Before Tony Liu speaks, I would like to explain that Tony, a very experienced founder and the CEO of the Company, does not speak English. Therefore, he will speak Chinese, and I will translate or voice over to the public.

    Tony Liu (translated by Hong): Thank you, Chris, and thank you, everyone, who joined us today. It's a pleasure to present AOBO's first conference call to discuss quarterly earnings results. We believe regular conference calls to discuss quarterly earnings is an appropriate step to allow our shareholders to have greater transparency and insight into our operations here at AOBO, by hearing directly from senior management.

    2005 has been an exciting and eventful year thus far for AOBO, as a number of positive developments have unfolded. We are very proud that in the last ten years, we have grown from a start-up in 1994 with about $100,000 of revenue to become a leading manufacturer of plant-based pharmaceutical products and plant-based nutraceutical products for the rapidly growing Chinese market. We generated sales of more than $31 million during 2004 and have seen our sales increase at 46% compound annual growth rate over the last three years. We operate in a large and growing market. We estimate that the total pharmaceutical and nutraceutical market in China was approximately $62 billion in 2004. Demographic trends in this market are favorable, as the Chinese population continues to grow and age and economic expansion in China creates wealth, which serves to increase the number of citizens who can afford healthcare. With the total market for pharmaceutical products in China, herbal and plant-based pharmaceutical remedies and products have an extensive history. Many Chinese consumers and doctors rely upon the use of plant-based products for treatment of a variety of different ailments, consistent with the Eastern philosophy of health and wellness.

    Our headquarters and manufacturing facilities are located in Harbin, China, a city with a population of approximately six million, in one of four pharmaceutical corridors in China. We utilize four proprietary technologies for manufacturing products, which provide both cost and quality advantages compared to many of our competitors. We currently have more than 100 products in our portfolio, all plant-based in formulation divided into two key categories: plant-based pharmaceuticals and plant-based nutraceuticals. PBP is the larger of the Company's two divisions as a percentage of revenue. PBP products in China require approval from the state FDA and are administered both through over-the-counter locations and through prescriptions at hospitals and clinics. The two largest products in the PBP category are Shuanghuanglian Powder Injection and Cease Enuresis Soft Gel. SLPI, our largest contributing product, as a percent of total revenue is one of the only two PBP herbal injections approved by the China state FDA for treating anti-viral indications. SLPI has been approved by China state FDA for treatment – selected by China state FDA for treating SARS during the SARS outbreak, although a definitive decision of efficacy of SLPI for the treatment of SARS has not been determined. Cease Enuresis Soft Gel is approved by the China state FDA as a prescription remedy for chronic bedwetting and nighttime urination.

    PBN is the smaller of the Company's two divisions. PBN products are not licensed by the China state FDA, but they generally require local government approval and are typically sold over the counter at the retail outlets. AOBO's PBN division products soybean peptide products in powder and liquid forms. Soybean peptide is a cholesterol-free energy-boosting protein source that enhances the immune system and has anti-fatigue benefits. AOBO also produces a line of nutritional products through the PBN division, including the Three-Happiness nutritional drink, which are rich in vitamins and amino acids to enhance well-being and to provide energy The Three-Happiness product line is a recognized retail brand name in China.

    We are very proud of the success we have had in growing both our PBP and PBN businesses. For the nine-month period ended September 30 th, 2005, we reported growth in total revenues and total net income of 81% and 85%, respectively, relative to the same nine-month period in 2004. During 2005, we have considerably improved our balance sheet and have successfully integrated HSPL, the acquisition we closed in the fourth quarter of 2004, which has expanded our product line, expanded our geographic customer footprint, and enhanced our channels of distribution.

    In addition to a number of positive strategic developments achieved for the business, AOBO was listed on the American Stock Exchange, and in November we received approval for a dual listing on the Archipelago Exchange, accomplishments that we believe will enhance the Company's profile with U.S. investors. The Pacific Exchange also announced this month that AOBO options will begin trading during November 2005. We are very proud of these achievements and believe AOBO is well-positioned for the next stage of growth and profitability.

    Our continued strong performance was again the highlight for the third quarter. We achieved record quarterly revenues of $13.4 million and net income of $3.7 million, or $0.08 per weighted average full-diluted share. The Company completed the redemption of its class "A and "B" warrants related to the November 2004 private placement, which added more than $11 million in cash to our balance sheet and increased AOBO's total cash position to just over $19 million.

    In addition, we opened our first and only specialty store, Life Peptide store, as a showcase for our plant-based nutraceutical products and a means to penetrate the Hong Kong market from both a branding and a product education perspective. This is in addition to the more than 100 independent retailers or retail stores who are now actively distributing our products in the region. We are extremely enthusiastic about expanding our addressable market and product line and implications for the Company's prospects going forward.

    I'd like to ask Lily Li, our COO and Acting CFO, to reveal our quarterly and year-to-date performance in more detail, and I will follow up with some closing remarks. Lily?

    Lily Li: Thanks, Tony. For reporting purposes, all financial results are stated in U.S. dollars. For the third quarter, we reported revenue of $13.4 million, an increase of 82% compared to the 7.4 million reported for the third quarter of 2004. Excluding the revenue contribution from the HSPL acquisition completed in November of 2004, organic revenues grew 24% for the quarter compared to the third quarter of last year. Plant-based pharmaceuticals represented 8.6 million or 64% of the total revenue, an increase of 174% compared to the third quarter of 2004. Revenues were partially impacted by continued strong sales of our Shuanghuanglian Power Injection acquired from HSPL in November 2004, which contributed 4.3 million or 50% of the division revenue, and the Cease Enuresis Soft Gel product, which contributed 3 million, representing 35% of divisional revenue.

    The plant-based nutraceutical division, which is primarily our soy bean peptide product, represented 4.8 million or 35.7% of total revenue, and it was up 13% versus the comparable 2004 period. Benefiting from increased marketing and field efforts to promote the benefits of this product, our Peptide product, our largest-selling product, grew in this division and represented 3.1 million or 65% of divisional revenue.

    Total cost of goods was 4.9 million, an increase of 102% compared to the 2.4 million from the same period a year ago. Gross margin was 63% for the third quarter of 2005 compared to the gross margin of 67% for the third quarter last year. Higher costs associated with the manufacturing of HSPL product was responsible for the decrease in gross margin. Results during the third quarter 2004 did not include any contribution from HSPL.

    Total selling and marketing expenses were 850,000, up 67% from 508,000 reported for the third quarter in 2004. Advertising expenses were 757,000, up 4% compared to 729,000 in the comparable period in 2004. General and administrative expenses were 1.9 million, up 117% compared to 893,000 for the comparable period in 2004. Total operating expenses were 3.9 million, an increase of 69% compared to the 2.3 million reported for the same period last year. The increase in total expenses was related to the HSPL acquisition, as well as an increase in costs necessary to support overall growth within our operation. Total continuing operating expenses as a percentage of sales for the period was 29% compared to 31% for the comparable period in 2004.

    We reported income for operations of 4.6 million, an increase of 75% compared to the 2.7 million for the comparable period last year. Operating margins were 35% during the quarter, compared to 36% during the third quarter 2004, with the decrease due in part to the impact of the integration of HSPL operations.

    Net income was 3.7 million or $0.08 compared to net income of 2.2 million or $0.07 for the third quarter last year. This represents an increase in net income of 66%, despite a higher effective tax rate of 23% for the third quarter 2005 versus 17% during the comparable period in 2004, as well as a 34% increase in our weighted fully-diluted share count, all 44,076,235 shares used to calculate earnings per share. For the nine-month period ended September 30, 2005, we announced revenue of 35 million, an increase of 81% compared to 19.3 million reported for the first nine months of 2004. Our PBP division reported 22.1 million in revenue, up 112% compared to the comparable nine months of 2004.

    For the nine months, 10.9 million of the revenue growth was contributed by Shuanghuanglian Power Injection, or approximately 50% of the division's revenue, and our Cease Enuresis Soft Gel products contributed 7.3 million or 33% of the division's revenue, representing 53% growth compared to the yearago nine-month period 2004. Our PBN division reported revenues of 10.9 million, up 13% as compared to the comparable nine months of 2004. The Peptide product line generated 8.1 million representing 63% of this division's revenue, representing 8% growth compared to the year-ago nine-month period 2004.

    Total cost of goods were 12.7 million, an increase of 109% compared to the 6.1 million from the same period a year ago, resulting in gross margins of 64% for the nine-month period of 2005 compared to gross margin of 68% for the same period last year. Higher costs associated with manufacturing Shuanghuanglian Powder Injection contributed to the increase in cost of goods sold. Selling and the marketing expenses were 2.1 million for the nine-month period, up 34% compared to the 1.5 million for the same period last year. Advertising expenses were 2.2 million, a decrease of 8% compared to the 2.3 million. General and administrative expenses were 5 million, up 80% compared to 2.8 million. Our total operating expenses were 10.1 million, an increase of 43% compared to the 7.1 million in the prior year. Operating expenses as a percentage of sales were 28.9% compared to 36.8% during the comparable nine-month period in 2004.

    AOBO reported operating income of 12.1 million, up 99% compared to the 6.1 million in operating income for the same period last year, with operating margins increasing from 32% to 3% as the Company benefited – I'm sorry, 32% to 35%, as the Company benefited from higher yearover-year revenue and increased leverage of operations. Net income was 9.2 million compared to net income of 5 million, an increase of 85% which equated to $0.22 per fully-diluted share compared to $0.15 per fully-diluted share for the nine-month period last year.

    Turning to the balance sheet, we completed the quarter with 19.1 million in cash and cash equivalents, which includes the 11.2 million received from redemption of class "A" and "B" warrants exercises during the third quarter 2005. This compares to 11.4 million in cash as of December 31 st, 2004. The Company reported 3.7 million in bank loans compared to 5.1 million as of December 31 st, 2004. During calendar year 2005, the Company has generated 3.9 million in positive cash flow from operations, which has helped to improve overall cash position.

    Thank you. I will turn this call back to Tony for closing comments.

    Tony Liu, (translated by Hong): Thank you, Lily. As the AOBO story continues to unfold, we hope the progress we have made in growing and diversifying the business becomes more evident. We believe this is just the beginning of the AOBO story, as we build upon our momentum. We own a very recognizable brand in China with our Three-Happiness nutritional beverages and the soy protein peptide line, and we have developed and own two growing products within the PBP market, all of which will benefit from further market penetration and expansion.

    We have a clearly defined two-pronged growth strategy. We seek to grow organically by focusing on new product development and expanding the application of PBP products. This strategic component involves further penetrating existing markets, capitalizing on the favorable macrodemographic trend I spoke of, and expanding our established distribution network. We currently have more than 10,000 points of sale, and our recent move into the Hong Kong market commences a key next step to leverage our recognized brand identity for our PBN products outside of mainland China.

    We will also seek to grow through acquisition and believe we have numerous opportunities to consolidate a fragmented industry with many small regional and (inaudible) players by purchasing proven products and incorporating them into our large and growing distribution network. AOBO is well positioned to capitalize on opportunities created by the privatization of Chinese state-owned enterprises by acquiring strategic assets to broaden our product platforms, utilize our distribution network, and elaborate our strong brand reputation.

    This was a brief overview of AOBO, and I hope during the coming year we will have the chance to meet with many of you and provide a more in-depth look into our business. In summary, this was an exceptional quarter for AOBO, and we are excited about the future. We would like to thank both our shareholders and employees for their continued support and dedication. Thank you, again, everyone on this conference call. Operator: Thank you. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time and have a wonderful day.

http://chinastockblog.com/article/4313

AOB is trending up now in a down market, currently @4.69 +.34

Some heavy institutional buying this morning made the spike.....

aob looks strong today ...it s heading nord...i was wrong

I think AOB found a support here... so what to do?  risk some money!!! ;)

Quote from: Terlisa on December 02, 2005, 02:28:57 PM
I think AOB found a support here... so what to do?  risk some money!!! ;)

If you got in anytime today you are better off than I am at 4.90 average price :-\  But I think you made a good, well timed decision!  :)

I was sure glad to see a nice white marubozu today, it was a nice weekend gift.  I had my fingers crossed since the candlesticks yesterday did look like a reversal could occur with the spinning top candlestick yesteday after the downtrend.

I have been posting in the "Chinese are all around:  AOB" thread recently, and a few others too, some good blog stuff there, etc.

I also noticed there is starting to be insitutional interest in AOB on I watch ever since it dipped recently, so there are still a number of positive signs here.

http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=AOB&range=30&mgp=0&hdate=&x=13&y=11

Here is the instiutional buy interest signs that I was referring to below.  As you can see, it has only started after the recent price drops that occured when the dilution news came out. 

part 2 of the nice analysis:

:D

American Oriental Bioengineering (AOB:AMEX) (12-02-05 Closing Price $4.75 USD) Strong Buy - 12-month target price: $8.33. Part 2 of 2.

Overview
On November 30th, I initiated coverage of American Oriental Bioengineering with a rating of Strong buy and a 12-month price target of 8.19. Part 1 of the report focused on quantitative measures of AOB which make it attractive; this part will focus on explaining AOB's activities and strategy going forward. I would also like to make a correction to a figure that I mentioned in part 1. Assuming the private placement goes through, AOB will have $79 million on cash, ($1.40/share), not $71 million ($1.25/share). I am also revising my target slightly upward to $8.33/share.

Market Analysis

American Oriental Bioengineering was founded in 1994 as a company focused on the manufacturing and sale of plant based medicine. Strong market growth and strong management have seen AOB grow from $100,000 in sales in 1994, to $47.6 million in sales on a last-twelve-month basis. AOB is a diversified Chinese healthcare company that operates in two distinct but related segments: plant based pharmaceutical (PBP) and plant based nutraceutical (PBN) products. The Chinese pharmaceutical/nutraceutical industry is currently estimated to be $62 billion dollars and growing at a rate of over 20% per year. The regulations regarding these 2 types of products differ, but AOB is able to gain synergies from these two distinct operating areas in terms of distribution, marketing and other administrative functions. PBP products require approval by the Chinese State FDA and are distributed to consumers via doctors and pharmacies (with prescription). PBN products do not require approval from the Chinese FDA, and are available over the counter, but often regulated by state governments. They are distributed via pharmacies and other retailers. In the first 9 months of 2005, PBP products comprised 63% of revenues and had gross margins of 63%. PBN products comprised 37% of revenue and had gross margins of 65%. AOB's core products can be classified as follows:

PBP Products

Shuanghuanglian lyophilized poweder for injection (SLPI)

SLPI is a plant based pharmaceutical marketed and approved by the Chinese FDA for treatment of viral infections. The government endorsed the usage of SLPI for treatment and prevention of SARS during the SARS crisis. An outbreak of avian flu could see a marked rise in demand for SLPI, if the government endorses it as a general immunity booster.

Cease-Enuresis Soft Gel

Cease Enuresis Soft Gel is the only Chinese FDA-approved prescription drug designed to alleviate bedwetting and nighttime incontinence. Cease Enuresis sales have grown significantly over the last year reflecting strong consumer demand for the product and increased distribution.

PBN Products

Soy Peptide Products

AOB markets the soy peptide nutraceutical in several forms: beverage, powder and pill. Soy peptide is a soy derivative that is rich in plant protein and amino acids. Soy peptide is used for its anti-fatigue properties and positive health effects including enhanced muscle development, anti-oxidant properties and many others. AOB extracts the peptide from the soy bean using a proprietary process which it describes as providing superior quality and cost. AOB produces a number of formulations of soy peptide powder, fortified with vitamins and other nutrients. The soy peptide beverages, are branded under the label "Three Happiness", and are fortified with vitamins and minerals. It is marketed as a health drink and AOB recently opened up its first retail store dedicated to selling and promoting soy peptide products; the store is named Life Peptide. This store is located in Hong Kong and could provide AOB with significant revenues going forward as well as open up the Hong Kong market to more of AOB's products. AOB also markets several variations of soy peptide pills.

AOB is well positioned from a market perspective to take advantage of the rising Chinese per-capita income, as well as an aging population. A wealthier consumer is often a more health conscious consumer, and AOB will benefit from an increase in spending on health products. Full product descriptions may be found at www.bioaobo.com

Strategic Vision and Key Developments

AOB hopes to execute a 2 pronged growth strategy. Firstly, they will seek organic growth through more extensive cross-selling and penetration of existing markets. Their retail outlet in Hong Kong is an example of a large potential contributor of organic growth going forward. Management sees their distribution network as a key success factor and seeks to leverage and expand this asset going forward. AOB currently has more than 10,000 points of sale, which they hope to grow to 20,000 within a year.

Secondly, AOB also seeks to grow through acquisition by purchasing proven products and greater distribution capabilities; integration of these will lead to growth of the top and bottom line. Management feels that they are well positioned to take advantage of accretive acquisitions through the privatization of state assets and bring added efficiency and increase the value and output of those assets. AOB is well financed to pursue their acquisition strategy. Assuming the recent private placement goes through, AOB will have $79 million in cash. This will put them in a position to make significant acquisitions going forward. AOB's market is currently fragmented, and AOB can help guide consolidation in the industry. The acquisition of a more diversified product base will also reduce the risk of AOB's revenue stream and would further enhance the value of AOB's extensive distribution network.

AOB is gaining more legitimacy in the capital markets. The recent private placement is an example of this, where Morgan Stanley picked up $20,736,000 worth of shares and warrants. Such significant support from Morgan Stanley is a positive mark on their legitimacy, and having such a well recognized institutional investor on side may bring further institutional attention to the stock. AOB has also begun holding quarterly conference calls in order to improve transparency and communication with shareholders.

Finally, as I would state for all Chinese stock with most of their revenue derived in Renminbi, there is a good chance that over the next few year there will be an upward revision in the Chinese currency. From what I have read, this could easily be as high as a 40% revision over the next 3-4 years. The Chinese have taken the first steps towards floating the currency and if they eventually allow the Renminbi to float, the effects on AOB's shares should be positive since they derive revenue in Renminbi, but report in USD.

Conclusion

AOB is a very strong company with a proven track record, excellent management and a clear focused strategy for the future. They are well positioned to take advantage of increasing wealth among Chinese consumers and growing levels of health consciousness. AOB is attractive from both a value and growth perspective, and currently trades at a 2005 forward P/E ratio of 17.4. Considering the current and historical growth rate, management's history of enhancing shareholder value, the strong balance sheet, and the possibility of a revaluation of the Renminbi, I believe that AOB deserves a forward 2005 P/E multiple of 30.5. This would be a fair multiple according to the dividend discount model, assuming a 30% growth rate for 5 years, followed by a terminal growth rate of 6.5% and a discount rate of 15%. I believe that these are all conservative and fair assumptions. AOB at this level is significantly underpriced, and I expect it to outperform the market in general. I am revising my target slightly upward and applying a 2005 forward P/E ratio of 30.5 for a 12-month target price of $8.33, representing an upside of 75% from Friday's closing price of $4.75.

http://harbinus.blogspot.com/2005/12/american-oriental-bioengineering_04.html

Thanks for the great write-up la-onda. That was very helpful.

A few months back an oldtimer from SharpCharts taught me something, about stochastics, to look for. I have been observing this unique setup of indicators since and have seen the setup over and over just prior to a breakout. Let's watch AOB and see if it follows through now. Here is the setup using both slow and fast stochastics. In a StockCharts2 beta window set your indicators as I have shown in the image below.

What I have been taught to look for is when all 3 indicators fall below the 20, then each stochastic crosses as it begins to turn up once again to the 20. When this happens, especially when all 3 turn-up at the same time a breakout will occur more times than now. For my convenience, notice I set all 3 indicator setups below the chart for cleaner observation. Finally, as I am learning -- in my watchlist, I have coined this setup 3on20 to catch my eye in the future

Like many of you, I am in AOB once again. These 3 stochastic readings simply give me one more confirmation of a breakout about to occur. ::)

What's the latest TA on AOB?

Thanks,
MG

Back to the decreases again.  :-[  Another thing ... how come this stock doesn't have a message board on Yahoo?

News:

QuoteHONG KONG--(BUSINESS WIRE)--Dec. 9, 2005--American Oriental Bioengineering, Inc. (AMEX:AOB - News), a leading Chinese manufacturer and distributor of pharmaceutical and nutraceutical products, announced today that it has closed its private offering to accredited investors of 12.5 million units at a price of $4.80 per unit, for gross proceeds of $60 million. Each unit consists of one share of common stock, par value $0.001 per share, and three tenths of a warrant to acquire one share of common stock at an exercise price of $6.50 per share. The co-placement agents were CRT Capital Group LLC and Westminster Securities Corp. The proceeds will be used for potential acquisitions and general corporate purposes.

click here
Gross proceeds of approximately $26,527,680, reflecting subscriptions for 5,526,600 units, will continue to remain in escrow, pending (i) the expiration of the requisite waiting period under Rule 14c-2 of the Exchange Act of 1934 with respect to the company's Information Statement on Schedule 14C filed with the Securities and Exchange Commission on December 7, 2005, (ii) the filing of an amendment to the company's certificate of incorporation increasing the number of its authorized shares of common stock to 150 million and (iii) the approval of an additional listing application to be filed with the American Stock Exchange with respect to the common stock underlying the units to be issued upon release of the remaining escrowed proceeds.

Tony Liu, Chairman and CEO of American Oriental Bioengineering, commented, "The company plans to use the proceeds for general corporate purposes and seeks to identify accretive acquisition targets within our industry to diversify our product line, accelerate our growth and more effectively leverage our distribution channels."

The shares and warrants have not been registered under the Securities Act of 1933, as amended, (the "Securities Act"), or any state securities laws, and unless so registered, the securities may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. American Oriental Bioengineering has entered into a registration rights agreement obligating it to file a registration statement with the Securities and Exchange Commission registering the shares, including the shares exercisable upon exercise of the warrants, within 45 days from the closing, or January 22, 2006.

This announcement shall not constitute an offer to sell or a solicitation of an offer to buy any of these securities.

About American Oriental Bioengineering Inc.

American Oriental Bioengineering, Inc. uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications. AOB also produces Cease-Enuresis Soft Gel, the only China State FDA-approved first-grade, plant-based prescription medicine that is specially formulated to help alleviate bed-wetting and incontinence. The company is a leading producer of products in both the nutraceuticals and pharmaceuticals areas in China. For more information, visit http://www.bioaobo.com.

About CRT Capital Group LLC

CRT Capital Group LLC ("CRT") is an institutional securities research and brokerage firm focused on high-yield and convertible debt, capital structure arbitrage, mergers and acquisitions, special situations and distressed securities. CRT trades senior and subordinated bonds, bank debt, trade claims, convertible bonds, equities, real estate loans, tax exempt securities and private placements. For more information, visit http://www.crtllc.com.

About Westminster Securities Corp.

Westminster Securities Corp. is a full-service brokerage firm operating in five principal areas: Investment Banking, Research, Account Management, Execution Services, and Clearing. Founded in 1971, Westminster is a member of the New York Stock Exchange, National Association of Securities Dealers and the Securities Investor Protection Corporation. Westminster is headquartered at 100 Wall Street, New York, with branch offices in Atlanta, Cyprus, Miami, New York, St. Louis and Toronto.

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in statements filed from time to time with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

This is a spectacular thread on AOB, sorry for taking it out of the free zone of the website (Previous 3 SOF Picks), I need it for the Premium Service  ;D

Now, we all know AOB is fundamentally sound as you can read on the exhaustive analysis just above on this thread. Today we've had the confirmation of some alledged bad news people were complaining: American Oriental Bioengineering, Inc. Closes $60 Million Private Placement (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=1039359&guid=%7BF00EC356%2DCFB2%2D40A4%2DABA5%2DD550AF84D00D%7D&symb=)

I think this news marks the end of the medium term decline on AOB shares, and a strong rebound will start after today's open. If I could grab my shares between $4.20 and $4.40 it would be lovely, but I don't want to risk losing the boat so I'll just buy around the open, 33.33% of the 3 SOF Fast Portfolio, as always (a little more than $5,000 at this point).

The company has a P/E of 16 and a earnings growth rate of 65%, it's undervalued at this point and due for a quick rebound, at least to the descending trendline, today at $5.37 but rising everyday.

quotation from Davids link:

Tony Liu, Chairman and CEO of American Oriental Bioengineering, commented, "The company plans to use the proceeds for general corporate purposes and seeks to identify accretive acquisition targets within our industry to diversify our product line, accelerate our growth and more effectively leverage our distribution channels."


cheers
Oliver

I bought in today but I have a few questions about the TA.  Isn't this a head and shoulder and down trending chart pattern ?
Also likely strong resistance likely near the previous up trend line?

i got in again today too. had a nice little profit going before then it dropped like lead in a minute.

technicals...  yes it does look like a down trends...

http://quote.barchart.com/texpert.asp?sym=AOB

Quote from: SmartWrasse on December 09, 2005, 01:49:01 PM
I bought in today but I have a few questions about the TA.  Isn't this a head and shoulder and down trending chart pattern ?
Also likely strong resistance likely near the previous up trend line?

All true. But, you see, the downtrend is too steep and considering fundamentals I believe there will be a strong 10 to 20% rebound soon. That's why I'm in AOB for the 3 SOF Fast Porftolio.

Also note that steep trendline was broken on the upside on Friday, despite the lower close than the open (it may serve as a short term retest).

My plan is to hold AOB for a 10 to 20% rebound from current levels. For today I'll just hold, whatever happens.

SovGEM Limited: Investment and Trading Update

Tuesday , December 13, 2005 02:02 ET

LONDON, UNITED KINGDOM, Dec 13, 2005 (CCNMatthews via COMTEX) -- Investment

SovGEM Limited ("SovGEM" or "the Company"), the emerging market finance house (LSE:SOV), today announces that it has made a $1.2 million investment in American Oriental Bioengineering Inc (AMEX:AOB). SovGEM has purchased 250,000 shares by participating in a private placement (PIPE) organised by Westminster Securities Corporation, a NYSE member firm. The registration of these shares is subject to the registration requirements of the US Securities Act of 1933 and also in part upon the approval of AOB shareholders.

AOB is a leading Chinese producer and distributor of a broad range of pharmaceutical and nutraceutical products for the Chinese domestic market. The company's shares are dually listed on the US American Stock Exchange (AMEX) and Archipelago Exchange (ARCA) markets. The Company's corporate office is in New York and its headquarters (production and R& D facilities) in Harbin, China. By the end of 2004 the Company had a total of 800 full time employees. The Company has grown its operating income from $10.2m in 2002 to $20.86 in 2003 to $31.96m in 2004.

SovGEM bought 250,000 AOB shares at $4.80 per share. Before news of the financing was announced AOB had traded as high as $7.68. The investment is part of a $60mm private placement that AOB intends to use to finance acquisitions and for general corporate purposes.

Trading Update

SovGEM joined AIM in November 2004 with a net asset value of 12.77p. Following its successful investments in Harbin Electric (OTCBB:HRBN) and Bodisen Biotech (AMEX:BBC) its net asset value as of November 9th 2005 is 18.1p , an increase of 41%. SovGEM initially purchased 450,000 BBC at a price of $4.50 in November 2004; currently we hold 70,000 shares that closed on 9 November 2005 at $12.40. In February 2005 SovGEM purchased 500,000 shares of HRBN, today we hold 200,000 shares valued at $7.80 at the close of business on 9th November 2005. We remain extremely excited about the potential news flow from these two companies as well as the future of AOBO.

Commenting on the investment, Hugh de Lusignan, Chief Executive Officer of SovGEM, said: "This is excellent news for SovGEM as it corresponds with our ongoing investment strategy of building a portfolio of investments in fast growing companies servicing the Chinese domestic market. Furthermore, it demonstrates our ability to source deals through an enlarged network of partners."

http://www.knobias.com/individual/public/news.htm?eid=3.1.6415031bb826fc74697f3ee68e5346e2c14edd696db065ec55666a6c9151d83b

Thanks for that article la-onda  :)

Institutional investors bought 60 million shares in a private placement at $4.80. I don't think AOB's share price will be under $4.80 for long, since if institutions liked the stock at $4.80, they like it even more at $4.43.

They will probably support prices at current levels and then retail investors will push this undervalued growth company higher, at least higher than $4.80.

But, probably not much higher than this level for the short term, since people will always be worried that institutions are looking to sell their shares with a small 10 or 20% profit (doesn't look like it).

I bought AOB at $4.55, my plan is to sell it at $5.46 until the end of the month (the ascending trendline on the chart below, previous support, now resistance, is standing at $5.5).

...just an information to all of you who want to visit the AOB message board:

Here is the link:
http://messages.yahoo.com/bbs?.mm=FNNS&action=l&board=17928841&tid=aoboobamericanorientalbioegineering&sid=17928841&mid=7699

You have to click on 'Last' then 'Msg List' to enter the actual message list.

Enjoy. ;)

Thanks, that is the first time I have actually been able to see the Yahoo MB for AOB, even though others have posted links on Yahoo for it.

I dont know what is going on with the selloff today, if it wasnt for NVAX jumping I would be pretty unhappy about it.  I am in at an average of 4.90, but still believe it gets to David's target.

Thanks for the link to AOB message board.

I have traded this stock three times, two with good results, however I am in at a very poor position @ 6.99 with a rather large number of shares.

At least I can find out if I will ever get out of jail.

I placed my trade on AOB, now I have to manage it. It's not doing well, so I have to limit the downside risk. I don't want to see it closing below $4.10 or I'll dump it.

Still expecting to sell with a profit around $5.50.

American Oriental Bioengineering Inc. Options to Trade on Chicago Board Options Exchange (CBOE)
Wednesday December 14, 8:30 am ET


HONG KONG--(BUSINESS WIRE)--Dec. 14, 2005--American Oriental Bioengineering Inc. (AMEX: AOB - News), an emerging Chinese company that produces and distributes a broad range of pharmaceutical and nutraceutical products, announced today that on Thursday, Dec. 1, 2005, options on the company's common stock began trading on the Chicago Board Options Exchange ("CBOE"). The CBOE is the world's largest options marketplace.
American Oriental Bioengineering options trade on the January expiration cycle with exercise limits set at 25,000 contracts on each side. The Designated Primary Market Maker for AOB is Susquehanna Investment Group.

In the last six months, AOBO has taken several steps to improve the visibility of the company's stock. On July 18, 2005, the company's common stock began trading on the American Stock Exchange. On Oct. 26, 2005, options on the company's common stock started trading on Pacific Exchange and most recently on Nov. 11, 2005, the company's common stock was approved for dual listing on the Archipelago Exchange ("ArcaEx"), a facility of the Pacific Exchange, and began trading on ArcaEx on Nov. 11, 2005.

"We are pleased to have our options traded on the largest options marketplace, the Chicago Board Options Exchange, and we believe this is another important event as we continue to improve the visibility and liquidity of our stock," commented Tony Liu, chairman and CEO of American Oriental Bioengineering.

May be the mm wants to push the price down to around $4.0 to make all the money in options.

Also from the chart, the support is at around $4.00.

Unless I see bullish candlesticker reverse signal, will not take a position.

Just keep an eye on AOB, take a position when necessary ;)

Thanks for posting the news la-onda  :) Thanks for your analysis shawFund and Terlisa  :)

Well, I already bought, so now I'm managing my position. I'll take a loss if the stock is set to close below $4.10 (maybe I'll take it when shawFund buys his shares, that's the market), and I'll take profits around $5.50 if I get that chance.

AOB's chart is getting better, maybe the time for a serious push back up has arrived. I'll keep my trading plan of taking profits around $5.5 or take a loss if the stock is set to close below $4.10.

I think it's time for entry ...goodluck traders ;)

nice day for AOB  >:D
chart:

hi,
bought at 4.59 this morning . put a trailing stop at 4.39 . and went out ., and low and behold i come home to find it at 4.80, my stop loss at 4.62 ....... sudden drop to where?........4.62 stopped out ....and then a lovely rally to 4.80...................oh well ...there is always monday :D
maxi

Quote from: David Randolph on December 16, 2005, 09:20:56 AM
AOB's chart is getting better, maybe the time for a serious push back up has arrived.

On the day he speaks it might be starting to happen.  David, you sure have a good feel for the market.  Keep up the great work.

Let's make some money on AOB!!
There is several positive signs showing & that makes me smile for this undervalued stock.
yahooooooooooo!!!!! ;) :D ;D

Nice white marubozu on AOB, with 2.3 million shares changing hands  :)

The stock is already just above $4.80, which was the price for a recent private placement. I expect this rally to continue and I'll take profits between $5.4 and $5.5 if I have the change.

Longer term AOB seems to be an undervalued fast growing Chinese company, but this is the Fast Portfolio. Perhaps I'll consider it later for the 3 Stocks on Fire portfolio.

I consider yesterday's market action on AOB to be low volume profit taking and some afraid that there are plenty of sellers just above $4.80, which was the price for the last private placement.

I don't think heavy selling will show up above $4.80, I believe investors are in it for longer term purposes.

The stock held well near the end of the session, as the general market collapsed. The white candle was made on more than double the volume of the red candle. I'll continue holding AOB and expecting to take profits around the $5.40-$5.50 area.

AOB: Short Interest UP 331.1% to 1.7M in Dec 2005

Wednesday, December 21, 2005 16:15 ET

According to new short interest data from AMEX, short interest for American Oriental Bioengineering Inc (AMEX: AOB) INCREASED 331.1% to 1,662,905 shares for the month ended mid-December, 2005.

SYMBOL     NOVEMBER      DECEMBER      CHANGE               %CHANGE       DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
AOB              385,759       1,662,905      +1,277,146      +331.07%           1
Based on AOB's 20-day average daily share volume of 1,835,425, it would require approximately 1 day(s) of buying to cover this short interest.

Thanks for the info la-onda  :)

Nothing changed on AOB, the stock made a little white candle yesterday. I'll continue with my plan of taking profits around $5.5 if I have the chance or take a loss if the stock is set to close below $4.10.

AOB, little by little, is making higher lows, so I expect it to rally before the end of the year.

The plan stays the same, take profits around $5.40 - $5.50 or sell if the stock is set to close below $4.10.

There was nothing new on AOB, both in fundamental and technical terms.

I'll sell AOB before Friday's close to end the December Edition of the 3 SOF Fast Portfolio.

There are only 3 trading days left in December and the 3 SOF Fast Portfolio is down 3.79%. I have three options:

1) Do nothing and sell the stocks just before the close of the last trading day of the year
2) Make a desperate try to get into positive territory
3) Clean up the portfolio and get ready to start over again in January

I have 10 years of experience trading stocks and especially futures. It wasn't a passive experience, just holding stocks for the long term. I made more than 5,000 trades during that 10 year period.

I know quite well that nearly everytime that I took one of the first 2 options I lost money and I lost big. Everytime I did nothing in the face of losses I lost more. Everytime I put my neck in risk to save a month I lost more.

When I recently started taking the 3rd option, having patience and ability to start over, I always came out of the reflexion period stronger and more open to all possibilities, inclusive the «make money» possibility.

Considering this, I will sell AOB around today's open.

nice AOB Summary for non 3stocksonfire subscribers:
http://harbinus.blogspot.com/2005/12/american-oriental-bioengineering.html
&
http://harbinus.blogspot.com/2005/12/american-oriental-bioengineering_04.html
&
http://www.knobias.com/individual/public/news.htm?eid=3.1.6415031bb826fc74697f3ee68e5346e2c14edd696db065ec55666a6c9151d83b

I will be patient, this is a winner for 2006

cheers
Oliver

I have some coments located here...on the Stock Picking Board.

http://www.3stocksonfire.org/trading/index.php?topic=3790.0

Finally a green and up day !! Currently up .11

Closed at 5.21 today - Very nice rapid comeback for AOB

Quote from: KCScott on January 10, 2006, 05:53:21 PM
Closed at 5.21 today - Very nice rapid comeback for AOB

Let's hope it continues!

UPDATED CHART:

FROM BAD TO GOOD

Monday I planed to buy 1,500 share of AOB at $4.97, but keyed in 15,000 shares.

Because I was busy I did not check my order. After I placed my order, I closed my account  and left my desk.

Because 1,500 share is very small potato for me, I did not check my account until now and surprised to find out that I have made $7,500 in two days. That is the biggest gain in two days for me (I bought those 15,000 between $4.97 - $5.00).

Now I set up a stop-loss order at $5.35 so I can keep my profit and let the stock run.

Quote from: shawFund on January 11, 2006, 01:12:30 PM
FROM BAD TO GOOD

Monday I planed to buy 1,500 share of AOB at $4.97, but keyed in 15,000 shares.

Because I was busy I did not check my order. After I placed my order, I closed my account  and left my desk.

Because 1,500 share is very small potato for me, I did not check my account until now and surprised to find out that I have made $7,500 in two days. That is the biggest gain in two days for me (I bought those 15,000 between $4.97 - $5.00).

Now I set up a stop-loss order at $5.35 so I can keep my profit and let the stock run.

Sweet! 8)  Beautiful start to the new year for you!

Anyone have any idea what's causing this run?  I know there was a report out about China's economy having a good 4th quarter but why would this affect AOB to this extent?  Any ideas?  I bought at $4.36 last week and also want to keep my profits.  Don't want to see another dive like it took it mid-November.

China's stock market has a bull run after New Year's day.

Most China's stocks traded in USA follows:

Look at SOHU, SNDA, FMCN, NTES, TOMO,, CHINA, CTRP, AOB, SNP, ....

Quote from: shawFund on January 11, 2006, 02:14:50 PM
China's stock market has a bull run after New Year's day.

Most China's stocks traded in USA follows:

Look at SOHU, SNDA, FMCN, NTES, TOMO,, CHINA, CTRP, AOB, SNP, ....

Ohhhhh yeah!!!! let the profit run for AOB ;)

Great mistake, shawFund ! ;D ;D
Congratulations!!!

Quote from: basonista on January 11, 2006, 02:05:08 PM

Quote from: shawFund on January 11, 2006, 01:12:30 PM
FROM BAD TO GOOD

Monday I planed to buy 1,500 share of AOB at $4.97, but keyed in 15,000 shares.

Because I was busy I did not check my order. After I placed my order, I closed my account  and left my desk.

Because 1,500 share is very small potato for me, I did not check my account until now and surprised to find out that I have made $7,500 in two days. That is the biggest gain in two days for me (I bought those 15,000 between $4.97 - $5.00).

Now I set up a stop-loss order at $5.35 so I can keep my profit and let the stock run.

Sweet! 8)  Beautiful start to the new year for you!

Anyone have any idea what's causing this run?  I know there was a report out about China's economy having a good 4th quarter but why would this affect AOB to this extent?  Any ideas?  I bought at $4.36 last week and also want to keep my profits.  Don't want to see another dive like it took it mid-November.

I guess first somebody spent 4.8 to buy alot of shares at their last offering,so it had to make a move above that (no brainer) and second this company started as a bird flu play and that topic is coming alive againg as the found bir flu cases in human in China and Turkey.I have been in since 4.5 with stocks and april calls.

let's see if we can break this heavy resistance around 6$, what do you guys think?!

I'm out @ 5.61 ;) :D ;D .... bought 4.50 (Dec 2.)  goodluck pips!!

out @5.87, almost the high of the day, was lucky but good for a 13% gain in 2 days! :)

In at $4.60 and out at $5.85. 

I'll buy again if this continues to pull back.

American Oriental Bioengineering Inc. (AMEX: AOB) Highlights:

--1H05 revenues up 81% year-over-year with net income up 100% year-over-year.

--The Company generated 2005 second quarter revenue of $11.9 million, a 98.2% increase compared to $6.0 million for the same period in 2004. The Company had net income of $3.4 million, or $0.08 per basic and diluted share, a 122.6% increase versus $1.5 million, or $0.05 per basic and diluted share, for the comparable period in 2004.

--Strong Balance sheet; announced that it has closed its private offering to accredited investors of 12.5 million units at a price of $4.80 per unit, for gross proceeds of $60 million.

--AOBO leverages over 10,000 distribution points, including clinics, pharmacies, supermarkets and hospitals.

--AOBO has achieved a 46% top-line CAGR since going public in 2002 through FY ending 2004 --Diversified product line creates broad opportunities for growth: AOBO has three primary product lines- herbal-based medicines, nutritional supplements and soybean peptides.

--Diversified and growing product portfolio:

About American Oriental Bioengineering Inc.
American Oriental Bioengineering Inc. (AOB) uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications. AOB also produces Cease-Enuresis Soft Gel, the only Chinese FDA-approved first grade, prescription medicine that is specially formulated to help alleviate bed-wetting and incontinence. The company is a leading producer of products in both the nutraceuticals and pharmaceuticals areas in China. For more information, visit
http://www.bioaobo.com.
TA Link:
http://www.stockta.com/cgi-bin/analysis.pl?symb=AOB&num1=3&cobrand=windchart&mode=stock
On Friday a Homing Pigeon was formed

American Oriental Bioengineering Institutional Coverage To Be Initiated By Investrend Research

Tuesday , January 17, 2006 01:04 ET

Jan 17, 2006 (financialwire.net via COMTEX) -- January 17, 2006 (FinancialWire) (Investrend Research Syndicate) American Oriental Bioengineering Inc. (AMEX: AOB) has enrolled in the unique shareholder empowerment platform administered by Investrend Communications, Inc., a provider of financial intelligence programs.

Institutional research coverage will be initiated by an Investrend Research analyst to be assigned in the next few days. Investrend Research is located on the web at http://www.investrendresearch.com .

American Oriental Bioengineering uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications.

The company also produces Cease-Enuresis Soft Gel, the only China State FDA-approved first-grade, plant-based prescription medicine that is specially formulated to help alleviate bed-wetting and incontinence. The company is a leading producer of products in both the nutraceuticals and pharmaceuticals areas in China.

The company's website is at http://www.bioaobo.com .

An InvestorPower" page has been created regarding the company at http://www.investrend.com/company/list.asp?sPathParam=yes .

American Oriental Bioengineering Loses 4.37% On Lower Volume After Enrollment

Wednesday, January 18, 2006 00:05 ET

Jan 18, 2006 (financialwire.net via COMTEX) -- January 18, 2006 (FinancialWire) American Oriental Bioengineering Inc. (AMEX: AOB) lost 4.37% on volume of 1,186,200, lower than its average 1,866,860, to close at $5.25 in its first session after announcing its enrollment in the unique shareholder empowerment platform administered by Investrend Communications, Inc., a provider of financial intelligence programs.

Institutional research coverage will be initiated by an Investrend Research analyst to be assigned in the next few days. Investrend Research is located on the web at http://www.investrendresearch.com .

American Oriental Bioengineering uses proprietary processes for producing soybean protein peptide more efficiently than traditional extracting techniques. These techniques are used to manufacture and formulate supplemental and medicinal products. Soybean peptides are used widely in general food, health food products and medicines, among other applications.

The company also produces Cease-Enuresis Soft Gel, the only China State FDA-approved first-grade, plant-based prescription medicine that is specially formulated to help alleviate bed-wetting and incontinence. The company is a leading producer of products in both the nutraceuticals and pharmaceuticals areas in China.

1. Profile

American Oriental Bioengineering, Inc (AOB). engages in the development, production, and sale of bioengineered products and traditional Chinese medicinal products, primarily in China. The company's product lines include Health Food, Chinese Medical, and Soybean Protein Peptide products. Health Food product series include compound bio-functional beverage, a nutritional beverage; iodine bio-functional beverage, a compound bio-functional beverage with Iodine additives; and vitamate oral liquid, which is designed to strengthen the immue system. Chinese Medical products series include Cease-Enuresis Soft Gel that helps alleviate bed-wetting and urination disorder; root of red-rooted salvia tablet that improves blood circulation to remove blood stasis; and Double Ginseng Yishen Grain, which is used for neurosis. Soybean protein peptide products include soybean protein peptide powder and soybean protein peptide coffee nutritious health drinks; and soybean protein peptide tablets, which maintains or improves protein nutrient condition of the human body. It offers its products through distributors, sales outlets, and hospital and clinics. The company is headquartered in Harbin, China.

2. Technical Analysis

2.1. Long Term Chart

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=13637;image)

I feel ashamed when I look at AOB's long term chart. Why? Because I bought it at $1.80 (when it was still at OTCBB) and then sold for a quick 38% profit. If I had the stock now I would have a 200% profit. Anyway, a speculator always needs to let the past go and concentrate on what he can do now. Because now is the only time a man can do something for his portfolio, certainly not in the past, and not in the future.

Since then I've been in and out of the stock with poor results. I wish this analysis makes my head clear on AOB.

Ok, on the long term chart we can see AOB had a huge run in 2005, the question now is: will the long term bullish trend continue, or is AOB making a top at this point?

The company increased the number of shares outstanding from 27 million in 2003 to the current 50 million, that is quite a dilution to shareholder value.

2.2. Medium Term Chart

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=13638;image)

AOB is undecided about her bull/bear outcome. On one hand we have a long term ascending trendline supporting prices (blue line), on the other a possible head & shoulders top.

If the stock could close significantly above S1 and S2 (about $5.90), the H&S top formation hypothesis would be abandoned. But if the stock breaks the ascending trendline and the neckline on the downside (around $4.30), we can assume that the long term trend is no longer bullish.

It's a tough call.

2.3. Short Term Chart

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=13639;image)

Today we had a nice reaction to the $4.9 support level, and we may attack the $5.90 resistance level shortly. If AOB breaks that resistance on the upside I see it going to new highs above $7.68, solely based on technical analysis.

3. Fundamental Analysis

3.1. Working Capital

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=13641;image)

AOB has a very strong balance sheet. Assets and cash levels rose every year and liabilities are, at least for now, quite small.

3.2. Revenues

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=13642;image)

Revenues are steadily growing 50% a year, or so. There's no analyst coverage on the stock, yet.

3.3. Net Income

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=13643;image)

Net income is not only growing, growth is accelerating !

3.4. Net Margin

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=13644;image)

AOB's fundamentals are really impressive, even the net profit margin is rising. It is now 28.9%, which is outstanding  :o

4. General Overview

I don't want to buy AOB on a trading perspective, been burned before doing that. If I buy it, it must be for long term purposes. Fundamentals are just amazing (I think this is the first time I'm really looking at them  :-[), my only doubt is how much dilution we'll see going forward.

The company certainly does not need more equity financing, but you know how these Chinese companies work ... they're not in the market to make shareholders rich, but, on most occasions, to suck their money.

If revenues continue to grow at 50% a year, in 10 years AOB will have revenues of $1.8 billion . If net margin stay at, say, 25%, it will earn $451 million in profits in 2016. Apply to this an earnings multiple of 20 and the company would be worth $9 B, or, 36 times more than today  :o

Looking at some of the company's products, like for example the UrinStopper Capsule (http://www.bioaobo.com/Product/niaochang.htm), thinking of the huge healthcare market China can become (not to mention AOB can expand internationally), yes, I think it is possible.

AOB can be considered a pharma or biotech company with many real products already being sold.

This is a big step for me, but I feel I can buy AOB with a long term perspective.

5. Trading plan

I'll buy $10,000 of AOB around today's open and I'll hold it for the long term.

Looks like we caused an order imbalance.  Hard time opening the stock!  ;D

This is the stock I bought 15k last week at $5.00 and sold it at $5.75.

I followed many of your views bought it back again today.

Check another AMEX IPO stock: BBC.

This company does similiar things as AOB is doing in China (in XiAn city).
The founder of BBC is a young lady and was unemployed 7 years ago.
She started her company with 3,000 yuan.

The stock has gained almost 300% in one and half months (from $6.5 in Nov 17 to $16.20).

Hope that AOB has the same development.

Since AOB is a long term investment, we need to dig into its numbers more carefully.

In David's post, 2005 revenue (es) is 46 mill and net income (es) is 16 mill.

This has raised some questions:

Because AOB first three quarter's total revenue is $34.95 mill. This leaves 4Q revenue only $11.05 mill, which is less than 3Q revenue. No growth compared with 3Q!!

The first three quarter total net income (profit) is $7.24 mill ($0.21 per share).

If 2005 yearly net income estimate is $16 mill, the 4Q net income has to be $8.76 mil,
which is unachievable with only $11.05 mill revenue.

Could you please let us know from where the numbers are obtained?

I bought AOB this morning but sold it later because I got confused with the numbers.

Here is the table

If this year's earning per share is $0.29 ($0.21 first three quarters), with stock price of $5.4,
the PE is 18.6.

I think that it is fairly valued for a China's stock (even high growth 30%+, we have to give some discount - 20% discount).

Actually most Taiwan Tech companies traded as a discount of 20%.

hi,
still holding up today. look at the moving averages..........10 day cross 50, 13 day about to cross fifty, 20 day on it's way to cross fifty,
happy trading
maxi

Quote from: shawFund on January 19, 2006, 10:00:56 AM
This is the stock I bought 15k last week at $5.00 and sold it at $5.75.

I followed many of your views bought it back again today.

Check another AMEX IPO stock: BBC.

This company does similar things as AOB is doing in China (in XiAn city).
The founder of BBC is a young lady and was unemployed 7 years ago.
She started her company with 3,000 yuan.

The stock has gained almost 300% in one and half months (from $6.5 in Nov 17 to $16.20).

Hope that AOB has the same development.

I looked at BBC for about 5 minutes, and I find it attractive. But not nearly as attractive as AOB (the market cap is about the same, but AOB's revenues, profits, assets and cash balances are quite superior).

Quote from: shawFund on January 19, 2006, 05:34:30 PM
Since AOB is a long term investment, we need to dig into its numbers more carefully.

In David's post, 2005 revenue (es) is 46 mill and net income (es) is 16 mill.

This has raised some questions:

Because AOB first three quarter's total revenue is $34.95 mill. This leaves 4Q revenue only $11.05 mill, which is less than 3Q revenue. No growth compared with 3Q!!

The first three quarter total net income (profit) is $7.24 mill ($0.21 per share).

If 2005 yearly net income estimate is $16 mill, the 4Q net income has to be $8.76 mil,
which is unachievable with only $11.05 mill revenue.

Could you please let us know from where the numbers are obtained?

I bought AOB this morning but sold it later because I got confused with the numbers.

Here is the table

Excellent post shawFund, I applaud !

Let me analyze this carefully:

QuoteIn David's post, 2005 revenue (es) is 46 mill and net income (es) is 16 mill.

Since there are no estimates from analysts, what I did was to annualize the first 3 quarters of 2006 to get an end of the year estimate. I get $46.62M in revenues because the 9 month revenues were $34,962,489*1.3333 = $46,615,487.

The same for earnings, but I made a mistake  :-[

9 month net profits were $10,102,729*1,3333 = $13,469,969 (I believe I used Income before Income Taxes on previous estimate, I didn't saw the right number on the column).

QuoteBecause AOB first three quarter's total revenue is $34.95 mill. This leaves 4Q revenue only $11.05 mill, which is less than 3Q revenue. No growth compared with 3Q!!

Since the estimate is based on the 4th quarter being an average of the 3 previous quarters (where there was always growth) this problem is solved.

QuoteThe first three quarter total net income (profit) is $7.24 mill ($0.21 per share).

I have as 9 month net income $10,122,729.

QuoteIf 2005 yearly net income estimate is $16 mill, the 4Q net income has to be $8.76 mil,
which is unachievable with only $11.05 mill revenue.

Yes, that would be impossible. But, revenues can be higher than my $46.62M ($11.67M for the 4th quarter) estimate (if growth in the previous quarters continues, as I think it will) and the new estimate for net income over the 4th quarter is something like $3.37M, which is quite feasible).

QuoteCould you please let us know from where the numbers are obtained?

Yes, the numbers were obtained annualizing the previous 3 quarters numbers. It is a very poor estimate, but AOB isn't covered by any financial analyst  :-\ (actually this is quite good news, when they start finding this jewel there will only be «buys»).

QuoteI bought AOB this morning but sold it later because I got confused with the numbers.

I want to apologize and I hope you're not confused anymore, and you're able to buy back the stock lower than you sold  :)

When the actual numbers come out I'll make my graphs again and make a new analysis on AOB. For now I just love the stock and I'll continue holding it for the long term.

just FYI:
AOB: Short Interest UP 2.4% to 1.7M in Jan 2006
Monday , January 23, 2006 06:00 ET

According to new short interest data from AMEX, short interest for American Oriental Bioengineering Inc (AMEX: AOB) INCREASED 2.4% to 1,702,791 shares for the month ended mid-January, 2006.

SYMBOL          DECEMBER         JANUARY      CHANGE   %CHANGE  DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
AOB            1,662,905       1,702,791         +39,886        +2.40%           2

Based on AOB's 20-day average daily share volume of 1,238,800, it would require approximately 2 day(s) of buying to cover this short interest.

Thanks David.

Because no coverage by analysists, we can make our own analysis.

If AOB can keep the same growth of 11% quarter over quarter and the same gross margin 64%,
the 4Q revenue could be $14.9 mill and net profit $4.00 mill ($0.09 share) making $0.30 EPS this year.

If we assume 30% growth rate, that will be a $9.00 stock (discount of 40% real growth rate).

That is under the assumption that there will be no further dilution. It is worth holding long term.

Quote from: David Randolph on January 23, 2006, 07:49:30 AM

Quote from: shawFund on January 19, 2006, 10:00:56 AM

Check another AMEX IPO stock: BBC.

This company does similar things as AOB is doing in China (in XiAn city).
The founder of BBC is a young lady and was unemployed 7 years ago.
She started her company with 3,000 yuan.

The stock has gained almost 300% in one and half months (from $6.5 in Nov 17 to $16.20).

Hope that AOB has the same development.

I looked at BBC for about 5 minutes, and I find it attractive. But not nearly as attractive as AOB (the market cap is about the same, but AOB's revenues, profits, assets and cash balances are quite superior).

I have been following BBC - maybe this should be on another board - and think it is a great opportunity if it will retrace ... I have been hoping for an entry point for a couple of months but the darned thing keeps going up!   ::)  Despite the name, it is a fertilizer company, and it is expecting revenue AND earnings growth in the 75-100% range in 2006 ...  I'd love the thoughts on others of an entry point

Back in to AOB today at 5.11, put in a limit order after I saw it had hit 5.08 once today and I guess it dipped back again long enough to get my order filled. 

I actually wouldnt be surprised if the stock pops down to under 5 briefly at some point, but I know it will go back up even if it does, and I didnt want to get left behind in this stock which has made me money every single time I traded it.  I bought it at around 4.9 and sold at 5.27 last round, but had to endure it continually dropping to 4.4, then bouncing to 4.8 a bunch of times before I could get that profit.  That was really strange to me since the stock price should have been pretty constant at $4.8 given the offer price of the additional stock.  Anyway, at this point I think the downside is limited and the upside is quite nice as per all the great analysis so far.  I have traded this stock many times, but will stick with it this time as a long term pick as per David's long term portfolio.

Other few China's plays are:

STP - the world number 1 Solar PowerCell manufacturer - > 50% world market share.

This is a real profitable company. Many US companies doing solar rersearch just burn money, never sells.

This company was founded in Wuxi, China by a Chinese who received Physics Ph.D from Australia 5 years ago.

FMCN - China's number 1 outdoor advertiser which controlls 80% China's market

BBC - already mentioned

NWD - a ShenZhen company. Do your own DD.

I will return to China next month to dig out more China private companies and will let you know if I found some.

As an emerging market, China provides many opportunities in the coming years.

Hi, Shawfund:
where did you get STP id world #1 solar cell manufacturer. if I look at STP website, STP is the fifth largest oen in the world. of course, may be the information they have is out of date. here is the link I have:
http://www.suntech-power.com/gsry.asp
from this figure, sharp is the biggest one, STP is the fifth.

BTW, do you really think solar cell can be widely used in the near future? the cost for sloar cell power is 25-50 cents/watt why current power price at USA is about 8-10 cents/watt.

I would say STP is a way too hype even at cuurent $36 price

just my thoughts

Here is a catch:

California will provide 1 billion dollars to help residents to install solar cells in their roofs. Each family could get a maximum of $1,800 for the installation.

The money will come from each resident's electricity bill (new tax).

That is, the residents pay one time installation fee and part of the expenses will be covered by the government. This way the family will see their electricity bills reduced in the following months.

This AOB thread is getting a bit out of hand, with other stocks being discussed.

Let's go back to AOB: technically the stock is still stuck between $4.90 and $5.90, building a triangular formation.

AOB has quite a turbulent story, been around since 1970 and only recently put its feet togheter. One classic OTCBB stock that finally made it:

«Our company was first founded as Champion Ventures, Inc. on November 30,
1970 under the laws of the State of Nevada. In May of 1999, it merged with
another Nevada company, Internet Golf Association, Inc. ("Internet Golf"), with
the latter becoming the surviving entity. On June 26, 2002, through a share
exchange, Internet Golf became the sole owner of Harbin Three Happiness
Bioengineering Co., Ltd., a company organized under the laws of the People's
Republic of China, to which we refer in this prospectus as Harbin
Bioengineering. Our company then changed its name into American Oriental
Bioengineering, Inc. AOB has subsequently become and is presently engaged in the
development and production of pharmaceutical and health supplement products and
traditional Chinese medicinal products that combine modern bio-technology and
traditional Chinese medical technology. AOB has developed a series of biotech
products marketed in China.

     The shares of common stock of our company are currently listed on the
American Stock Exchange and the Archipelago Stock Exchange under the symbol
"AOB."»

If all warrants are exercised at prices of $4.80 and $6.50, AOB will be with 67,523,288 shares outstanding, so the market cap is $347.74M. Is it worth it?

Well, 2005 net profits seem to be something like $10.7M, so the earnings multiple is about 32. Earnings growth is about 50%. I think it will be worth more than this in the future.

I'll continue holding AOB for the long term.

Nice technical breakout on AOB yesterday. If we take out $5.90 the sky is clear to defy the all time high set at $7.68.

I'll continue holding this fast growing Chinese (going global now) company for the long term .

Oh yes, AOB is fighting with the $5.90 resistance level. You see, if we cross that level and close decisively above it, the whole chart structure changes and the stock turns short and medium term bullish again, instead of bearish (longer term AOB has been bullish for a long time).

There's a nice post on AOB's Yahoo board:

AOB --a flying saucer-- (http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=3750345527&tid=aob&sid=3750345527&mid=1944)

I'll continue holding AOB for the long term.

isn't this a cup and handle?
maxi

AOB still looks pretty...  :o

AOB still sitting pretty going into earnings season....

when is the next conference call ?...i heard on a message board it s the 14 or 15th this month? someone knows?

Im back in AOB at 5.43... I checked out lycos I Watch and saw instituations loading up last couple weeks and today as well. It looks like we are going to get a strong push to 6 and above. Everything is lining up for a push to 6... Strong base in the 5.00s,  Good earnings due soon, Increased buying from institions, China growth hype, and PR of a acquisition.

Quote from: ket1390 on February 03, 2006, 08:17:05 AM
when is the next conference call ?...i heard on a message board it s the 14 or 15th this month? someone knows?

I also don't know ket1390  :-[

AOB failed to close above the $5.9 resistance level and it sold off. Perhaps it is building an ascending triangle pattern. Nothing new on the fundamental side, I'll continue holding AOB for the long term.

AOB does not have to report until the end of March and historically they have reported at the "last minute" or late.

http://www.sec.gov/cgi-bin/browse-edgar?company=american+oriental&CIK=&filenum=&State=&SIC=&owner=include&action=getcompany

Was that doji today?

Any opinions on today's action?

I have an opinion.    My theory is:  it went down because I bought it.  :'(  Kinda like how I can make it rain by washing my car.

Seriously, it does look like a cup w/handle formation and I've noticed many times a sharp decline for a couple of days after the handle forms before the "big run".  This is just my opinion on observations I've made...I've been shaken out by them on more than one occasion.

On a more technical note, the bottom bollinger band is fast approaching, which would also coincide with the above statement.  If it closes below it I will bail out with about a 9% loss.

Other opinions welcome.

It is either range trading $5 - $6 or double top if it break down at $5.

Will take position $4.50.

I need an explanation:

Tuesday , February 07, 2006 09:52 ET

Feb 07, 2006 (M2 PRESSWIRE via COMTEX) -- BUYINS.NET, www.buyins.net, announced today that these select companies have been on the NASDAQ, AMEX and NYSE naked short threshold lists for 13 consecutive trading days: American Oriental Bioengineering, Inc. (AMEX: AOB), Distribucion y Servicio S.A. (NYSE: DYS), Lipid Sciences, Inc. (NASDAQ: LIPD), LightPath Technologies, Inc. (NASDAQ: LPTH), La-Z-Boy Incorporated (NYSE: LZB), World Heart Corporation (NASDAQ: WHRT). For a complete list of companies on the naked short lists please visit our web site. To find the SqueezeTrigger Price before a short squeeze starts in any stock, go to www.buyins.net/squeezetrigger.pdf.

Regulation SHO took effect January 3, 2005, and provides a new regulatory framework governing short selling of securities. It was designed with the objective of simplifying and modernizing short sale regulation and providing controls where they are most needed. At the conclusion of each settlement day, data is provided on securities in which: 1) there are at least 10,000 shares in aggregate failed deliveries for the security for five consecutive settlement days, and 2) these failures constitute at least 0.5% of the issuer's total shares outstanding. Regulation SHO mandates that, if a clearing agent has had a fail-to-deliver position for 13 consecutive settlement days, that clearing agent, and the broker/dealer it clears for, must purchase securities to close out its fail to deliver position.

American Oriental Bioengineering, Inc. (AMEX: AOB) engages in the development, production, and sale of bioengineered products and traditional Chinese medicinal products, primarily in China. The company's product lines include Health Food, Chinese Medical, and Soybean Protein Peptide products. Health Food product series include compound bio-functional beverage, a nutritional beverage; iodine bio-functional beverage, a compound bio-functional beverage with Iodine additives; and vitamate oral liquid, which is designed to strengthen the immue system. Chinese Medical products series include Cease-Enuresis Soft Gel that helps alleviate bed-wetting and urination disorder; root of red-rooted salvia tablet that improves blood circulation to remove blood stasis; and Double Ginseng Yishen Grain, which is used for neurosis. Soybean protein peptide products include soybean protein peptide powder and soybean protein peptide coffee nutritious health drinks; and soybean protein peptide tablets, which maintains or improves protein nutrient condition of the human body. It offers its products through distributors, sales outlets, and hospital and clinics. The company is headquartered in Harbin, China. With 49.83 million shares outstanding and 1.70 million shares declared short as of January 10th, the failure to deliver in shares of AOB has not been resolved and a buy-in is imminent.

La-Onda,

In order to short, you must "borrow" the shares to sell them. You buy them back later (hopefully at profit and return them to the owner) These shares are always (I believe) held in by brokerages in Margin Accounts

Obviously this means there is a finite amount of shares available.

Naked shorts means someone was allowed to short the AOB without those shares being available to borrow. If your link is correct, it means those who are Naked short will be required to cover their positions beacuse the shares they have sold do not exist.

link:
http://www.knobias.com/individual/public/news.htm?eid=3.1.b0ae7e9a72dc9a3982e1c2fc9ab83f602db0eee15ed6f79ab54912d17775958c

Can somebody please explain to me what the effect on a stock is if it was on the short list for 13 days?

At the end of the 13 days do they try to buy the stock back and cover therefore causing the stock to go up?

Where to you think AOB is headed short term - the PE seems to be very low and the fundamentals are good.

Quote from: KCScott on February 10, 2006, 09:29:15 AM
La-Onda,

In order to short, you must "borrow" the shares to sell them. You buy them back later (hopefully at profit and return them to the owner) These shares are always (I believe) held in by brokerages in Margin Accounts

Obviously this means there is a finite amount of shares available.

Naked shorts means someone was allowed to short the AOB without those shares being available to borrow. If your link is correct, it means those who are Naked short will be required to cover their positions beacuse the shares they have sold do not exist.

I agree with KCScott's explanation. I would only change the last phrase from «...because the shares they have sold do not exist.» to «...because the shares they have sold were not previously borrowed.»

Over the last 3 trading days the company released reports about those 17,387,500 new shares that we already knew for some time, no surprise here.

Quote(2) Assumes that the selling shareholder will resell all of the shares of our
common stock offered hereunder. Applicable percentage of ownership is based on
62,635,788 shares of our common stock outstanding as of January 23, 2006,
together with securities exercisable for, or convertible into, shares of common
stock within 60 days of January 23, 2006.

So, on a fully diluted basis the company has 62,635,788 outstanding shares, so the market cap is about $324M (I'm assuming all warrants will be converted by private investors, but that's quite an assumption, since the conversion price is $6.90). I expect net income in 2005 to come in at about $10.7M, so the earnings multiple is about 30.

Is AOB overvalued? Perhaps ... or maybe it isn't as great as opportunity as I thought. I need to study some more before I jump into conclusions, but as I see more and more stocks maybe I'll find that AOB does not belong in a short list of 10 stocks to hold for the long term.

In the meantime, I have to say I'll continue holding AOB for the long term, as the stock continues to trade between $4.90 and $5.90.

We've learned yesterday that Morgan Stanley owns 6% of AOB. Probably we're about to hear the 4th quarter results rom the company, since they reported the 3rd quarter results on November 14th.

I hope revenue is about $15M and EPS is higher than $0.08, continuing its growth path (on the previous 3 quarters, AOB's revenues were $9M, $11M and $13M on the latest quarter).

If EPS comes in at $0.10 (would be great), the earnings multiple would be $5.09/$0.40 = 12.73, which would be very attractive, considering the company's growth.

Getting a little more confident, let's see what the quarterly presentation brings. Technically the stock is still trading between $4.90 and $5.90.

I received my "information" statement for AOB yesterday.

On Nov. 28 they received consent to increase the total shares from 60m to 150m and the issuance of the private placement, of 60M shares at 4.80.

The private placement is completed, but I don't see what the disposition of the other 30M shares is. Perhaps this is why the price has struggled to break the $6 barrier.

David:

  I would like to give some Chinese companies' stocks which at current value are quite attractive:

HRAY, LTON, SNDA all at around year low.

HRAY spent the whole year in $7.8 - $11.8 range. Most time it is traded in $8.3 - $10.3 and now $8.10.

Last three quarter earnings: $0.31, $0.25, $0.22. It will report earnings next Monday (estimate $0.17).

So this year's earning about $0.95 PE = 8.

May be, we can wait for its earning release to do futuer analysis.

SNDA: business transition year. CSCO holds 7%. It spent last two months to build its base.

LTON: all time low $6.00 and now $7.11. Long term very positive.

CHINA: announced that it bought an India outsourcing company today.

SVA: has the potencial to gain big once its production line put into use in the near future.

AOB: Short Interest UP 3.6% to 1.8M in Feb 2006
Wednesday, February 22, 2006 16:15 ET

According to new short interest data from AMEX, short interest for American Oriental Bioengineering Inc (AMEX: AOB) INCREASED 3.6% to 1,764,618 shares for the month ended mid-February, 2006.

SYMBOL       JANUARY        FEBRUARY        CHANGE       %CHANGE  DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
AOB            1,702,791       1,764,618         +61,827        +3.63%           2

Based on AOB's 20-day average daily share volume of 1,054,495, it would require approximately 2 day(s) of buying to cover this short interest.

Quote from: shawFund on February 21, 2006, 01:37:13 PM
David:

  I would like to give some Chinese companies' stocks which at current value are quite attractive:

HRAY, LTON, SNDA all at around year low.

HRAY spent the whole year in $7.8 - $11.8 range. Most time it is traded in $8.3 - $10.3 and now $8.10.

Last three quarter earnings: $0.31, $0.25, $0.22. It will report earnings next Monday (estimate $0.17).

So this year's earning about $0.95 PE = 8.

May be, we can wait for its earning release to do futuer analysis.

SNDA: business transition year. CSCO holds 7%. It spent last two months to build its base.

LTON: all time low $6.00 and now $7.11. Long term very positive.

CHINA: announced that it bought an India outsourcing company today.

SVA: has the potencial to gain big once its production line put into use in the near future.

Thanks for these stocks shawFund, I'll take a look at them when I have some more time.

Considering AOB, the stock may have a somewhat larger valuation, like TRAD, because recent growth has been very high. I hope the company continues to deliver exceptional growth going forward.

I'm not very confident on this pick, but I'll give it some more time to study and collect information. In the meantime, I'll continue holding it.

Now I remember why I choose AOB to update on the LTOF Portfolio, it was because KCScott sent me an e-mail about the company.

Unfortunately I don't open my e-mail box for about a week or so, so I have thousands of e-mails (honestly, I'm afraid of my e-mail box - don't think I'm crazy, I ain't, I just feel it enters my privacy ... strange thought).

Anyway, I'll open that box today, read KCScott's e-mail and write about AOB again tomorrow.

Received from Scott Trade in Mid February:

(http://img.photobucket.com/albums/v11/kcscott/AOB1.jpg)

(http://img.photobucket.com/albums/v11/kcscott/AOB2.jpg)

(http://img.photobucket.com/albums/v11/kcscott/AOB3.jpg)

(http://img.photobucket.com/albums/v11/kcscott/AOB4.jpg)

(http://img.photobucket.com/albums/v11/kcscott/AOB44.jpg)

(http://img.photobucket.com/albums/v11/kcscott/AOB6.jpg)


Also, I called the NY office on Friday to speak with IR.
Talked to Mr. Hung who said announcement for earnings release would be coming up soon.
They must release by 3-31 - He indicated Management had been very busy putting the money from the offering "to work" - could not elaborate further

check the link:

http://xml.10kwizard.com/filing_raw.php?repo=tenk&ipage=4012271

Wow, AOB got slaughted today.  Took over $800 loss in one day. What do you think of the stock?

I did not own AOB now because I believe that it is fully valued at this price. Their private placement added the pressure.

Also the company is located in HEILONGJIANG province, the center of China's fraud state.

Even I first bought it last July, I was doubt about this company's credibility.

But I was over cautious at that time because they need to pump up the stock price in order to get private placement. As a result I only took small positions each time, except once that I hit the wrong botton and bought 15,000 at the begining of this year.

AOB on the other hand may provide good chance to take position. Want to wait for their earning release.

(1) Unless otherwise indicated, the warrants represented are exercisable at
$6.50 per share of our common stock.

(2) Assumes that the selling shareholder will resell all of the shares of our
common stock offered hereunder. Applicable percentage of ownership is based on
62,385,788 shares of our common stock outstanding as of March 1, 2006, together
with securities exercisable for, or convertible into, shares of common stock
within 60 days of March 1, 2006.


Unless I'm not understanding something, these warrants aren't exercisable until the share price hits $6.50

I don't think Alpha Capital A.G. & Longview Fund, L.P. are in this to lose money, so unless I'm missing something, That would seem to be very bullish development.

AOB is sitting below the BollingerBand and seems to have dropped below support. Where do we think this one is going? It looks oversold according to the Williams % (sorry don't know how to post a chart).

If the PE is only 15 - doesn't that leave alot of room fundamentally for this stock price to grow?

Well, today was down right ugly.  :P  I had been sitting with a decent profit until today.  I was hoping to ride this one at least to earnings.  I checked on the institutional buying for today and saw there was a strong Buy message around 2:00pm for 500K at $4.62.  I am not sure how reliable Thomson Finance numbers are.  David, I was wondering if you had any thoughts on why the sudden drop and where to move from here?  Not quite in the red yet.  I appreciate any feedback.

Alien

I still dont udnerstand how the current news would impact the stock price this way, but I can say that there have been times in the past, i.e. around 2 months ago when AOB traded this way for no apparent reason that I could see.  I am going to stick this one out until earnings unless there is tangible bad news.

The paper KCScott kindly posted tells us the company increased the number of authorized shares from 60 million to 150 million so they could do the private placement they already did.

The details of that private placement are as follows:

« On November 28, 2005, we entered into a stock purchase and warrant
agreement, to which we refer as the Purchase Agreement, with thirty-one (31)
accredited investors, to which we collectively refer to as the selling
shareholders. Pursuant to the Purchase Agreement, the selling shareholders
purchased 12,500,000 units, each unit consisting of (a) one (1) share of common
stock and (b) three-tenths of one common stock purchase warrant, at a purchase
price of $4.80 per unit. The private placement closed on December 8, 2005. The
Units were issued in two tranches, the first tranche consisted of 6,973,400
units issued on December 8, 2005. The second tranche consisted of 5,526,600
units issued on January 23, 2006, following the expiration of the waiting period
under Rule 14c-2 of the Exchange Act and the amendment of our articles of
incorporation.

     The exercise price of the warrants issued to the selling shareholders is
$6.50 per share. Pursuant to these warrants the selling shareholders are
entitled to purchase an aggregate of 3,750,000 shares of our common stock. The
warrants will expire on December 8, 2008.»

So, below $4.80 these investors (31 in total) are losing money. But, above it, they are making money.

I don't know why AOB is falling, the stock is at a critical technical point. I will also hold for the earnings release and will continue holding AOB for the long term.

Is this a head & shoulders? OUCH what is everyone doing with AOB?

nice news:
American Oriental Bioengineering Rated 'Buy/4,' Target Valuation $6 By Investrend Analyst Kipley Lytel, CFA
Monday March 13, 8:30 am ET

NEW YORK--(BUSINESS WIRE)--March 13, 2006--(Investrend Research Syndicate) American Oriental Bioengineering (AMEX: AOB - News) has been rated 'Buy/4' in an initiating Institutional report by Investrend Research analyst Kipley Lytel, CFA, and assigned a target valuation of $6.

The full report is at http://www.investrendresearch.com. In it the analyst also stated:

The rating is predicated on the price gap between AOB's current stock price and the implied company intrinsic value, along with::

(1) AOB's 10+ year seasoned history recently marked by visible operational execution;

(2) 81% revenue and 85% net income year-over-year comparable period increases for the nine-month period ended Sept. 30, 2005 (9mo2005), respectively;

(3) operating income margin (EBIT) for the 9mo2005 period increased 3.1% to 34.7% compared to 31.6% in the same period last year;

(4) balanced organic company growth via new products, expanding distribution, and greater product penetration;

(5) external acquisition growth uniquely benefiting China-based companies accessing capital by means of its US exchange traded status to garner extraordinary opportunities of the privatization of China state-owned pharmaceuticals;

(6) successful array of growth products in market, complemented with a strong series of new products the together bring the product portfolio into triple digits;

(7) distribution of over 10,000 points of sale to pharmacies, hospitals, supermarkets, and both small & chain retail penetration (new company-owned retail agenda with PBN products, called Life Peptide; and

(8) a world-class management team with experience in fusing both Western & Eastern markets.

American Oriental has more than quadrupled its sales since 2001. In both 2003 and 2004 annual sales grew by more than $10 million. Furthermore, revenue for 9mo2005 grew by 81% year-over-year.

AOB is continuing its organic growth potential while also diversifying the company away from product concentration risk. Plant-Based Pharmaceutical (PBP) and Plant-Based Nutraceutical (PBN) together have over 100 products in the portfolio and over 10,000 points of sale.

An InvestorPower(TM) page has been created regarding the company at http://www.investrend.com/company/list.asp?sPathParam=yes.

Investrend Research has been the leading independent equity research publishing and distribution program since 1996, with over 75 qualified professional analysts posting more than 1,000 reports to date. Anyone may enroll a company. Enrollment fees for the Institutional research platform are $36,890, which are being paid by the company. Analysts are paid in advance for their initial reports by Investrend Research to limit or eliminate pecuniary interests, and no one associated with the program may own or trade in the equities of companies under coverage.

The company's research has also been enrolled in the investor-monitoring program by the Shareholders Research Alliance (http://www.shareholdersresearch.com), to eliminate conflicts and bias, and Investrend subscribes to the "Standards for Independent Research Providers" at http://www.firstresearchconsortium.com.

Anyone interested in receiving alerts regarding American Oriental should e-mail [email protected] with "AOB" in the subject line.

fyi  ;) :

AOB: Investrend Starts @ Buy; Sets Tgt @ $6; Analyst Notes
Tuesday , March 14, 2006 14:45 ET

Issuer: American Oriental Bioengineering Inc (AMEX: AOB)
Analyst Firm:  Investrend Research
Ratings Action: INITIATE
Current Rating: Buy
Target Price Action: INITIATE
Target Price: $6.00
Analyst Comments: The firm's rating is predicated on the price gap between AOB's current stock price and the implied Company intrinsic value, along with consideration of following: (1) AOB's 10+ year seasoned history recently marked by visible operational execution; (2) 81% revenue and 85% net income year-over-year comparable period increases for the nine-month period ended Sept. 30, 2005 (9mo2005), respectively; (3) operating income margin (EBIT) for the 9mo2005 period increased 3.1% to 34.7% compared to 31.6% in the same period last year; (4) balanced organic Company growth via new products, expanding distribution, and greater product penetration; and (5) external acquisition growth uniquely benefiting China-based companies accessing capital by means of its US exchange traded status to garner extraordinary opportunities of the privatization of China state-owned pharmaceuticals.


28 slides AOB analysis:

http://www.knobias.com/research.pdf?id=4180


chart:

blog quotation:
The MACD looks very bullish here, and would suggest that a good up move is coming. The RSI is also pointing up. More importantly though, will be the stocks ability to pass resistance at $4.80. Judging from the indicators, and the recent pattern, it seems like there is a good chance this will happen. It looks like the stock has been "bubbling up" to that $4.80 mark over the last few weeks, and building up pressure. Once it breaks through, if it breaks through, that should help fuel a big move up. This stock has a history of those types of breakouts. My initial target is $5.14 (50 DMA)

&
AOB: Short Interest DN 43.0% to 1.0M in Mar 2006
Tuesday , March 21, 2006 16:15 ET

According to new short interest data from AMEX, short interest for American Oriental Bioengineering Inc (AMEX: AOB) DECREASED 43.0% to 1,006,069 shares for the month ended mid-March, 2006.

SYMBOL      FEBRUARY           MARCH          CHANGE       %CHANGE     DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
AOB            1,764,618       1,006,069        -758,549       -42.99%           2

Based on AOB's 20-day average daily share volume of 884,265, it would require approximately 2 day(s) of buying to cover this short interest.

FYI

AOB will release its 2005 fourth quarter and year end results before the market opens on Friday March 31, 2006.  A CC will take place at 10 AM ET.  Their web site is http://www.bioaobo.com.

Anyone still in the game.  Any thoughts on holding this one through earnings.

Alien

Bought it today at open $4.80.

Run-up before earning release.

The earning should be good. But if it runs too high before release, it will be subject to profit taking after good earning report unless the numbers are  very good similiar to GIGM case.

Yay! Today is the first time in a long time that I saw any green in my AOB.  Hope it keeps going!

ShawFund, how much do you think is "too high" in terms of where you would sell AOB before earnings if it got too far ahead of itself again?

Quote from: shawFund on March 29, 2006, 11:38:54 AM
Bought it today at open $4.80.

Run-up before earning release.

The earning should be good. But if it runs too high before release, it will be subject to profit taking after good earning report unless the numbers are  very good similiar to GIGM case.

Congrats Shawfund - Good timing. AOB showed significantly strength today finishing above MA50 and at the high of the day with above average volume. This is a good omen for the earnings on Friday. Q4 is normally AOB's strongest quarter so we will hopefully have a good reaction to earnings.

(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=18260;image)

Quote from: alien41 on March 28, 2006, 10:15:36 AM
Anyone still in the game. Any thoughts on holding this one through earnings.

Alien

Well 3SOF will hold over earnings. I expect earnings to come in significantly above Q3 05. Some caution though; the stock count has increased during the quarter so EPS will not increase as fast as earnings.

AOB is the last stock in 3SOF without a stop and it seems prudent to put a stop before the earnings are released. AOB will as said most likely produce a nice set off figures on Friday but to insure against negative surprises we will set a tight stop at 4.56 just below the support at 4.6.  AOB will release their earnings before the opening so we might adjust the stop if there are any significant deviations to our expectations.

I sold it this morning at $5.33.

My target before earning release is $5.5 but I have to go sleep now (This post is sent from Beijing China) and I don't want to hold it over earning release. It may give a very good surpvise, but for one day gain of 11% (I bought 15,000 shares), it is enough for me.

I hold EONC over its earning release because I did a very detailed analysis about what it would report (earn $0.02-$0.05 cents) and had confidence holding it but not for AOB.

Good luck for everyone holding over its earning release.

all details:
http://www.knobias.com/individual/public/news.htm?eid=3.1.74914e3919cd44edb5cedf65a1545a3ec6b433e5a4d560f11dcd5cc5f3b5283c

summarization:
AOB: Q4 EPS 9c vs 8c EPS +12% Y/Y
Thursday , March 30, 2006 17:13 ET

QUARTER RESULTS
American Oriental Bioengineering Inc (AOB) reported Q4 results ended December 2005. Q4 Revenues were $19.77M; +55.79% vs yr-ago. Q4 EPS was 9c; +12.50% vs yr-ago.

YEAR-END RESULTS
Co. also reported Year-End results ended December 2005. FY Revenues were $54.73M; +71.19% vs yr-ago; BEATING revenue consensus by +9.46%. FY EPS was 31c; +34.78% vs yr-ago; BEATING earnings consensus by +63.16%.


http://www.knobias.com/individual/public/news.htm?eid=3.1.55b3a5c4a059ecaffab0361732fe275d4453cb9147d0ba71fe0ec0712750f9dc

For AOB, it is the future growth we are looking for.

The revenue growth is expected. Because the company needs more money to expend its business, it issued a lot of new shares. Therefore, even revenue increased >70%, its EPS stayed the same as compared with last year.

If the company does not isuue new shares and its revenue growth keeps the same pace as it did this year, the stock is certaintly undervalued.

Otherwise, the fair value may be at $6.00 as analyst indicated.

The result for Q4 05 was $4.2 million, that is below my expectations which was around 4.6 million (Q3 2005 was $3.7 million). This is a rather large shortfall but we will still keep AOB in 3SOV unless it penetrates our stop at 4.56. Based on the reaction in after hours trading, this is unlikely.

Even with the Q4 result and dilution during 2005 AOB is still attractive priced and with the analyst's EPS expectations exceeded by 63% we should have a positive reaction to the earnings report.

As Shawfund rightly say it all comes down to the risk of further dilution. Without the dilution AOB would have had a 47% increase in EPS in Q4 year over year.

AOB is grossly overcapitalized at present with 57 million in cash and a healthy operational cash flow (11.6 million in 2005). In addition to this they received additonal $25 million in connection with the second tranche of the private placement. Total cash at present is therefore $82million with basically no debt.

There can only be one reason for this excessive amount of cash on the balance sheet: they will continue their aggressive acquisition policy in 2006 as they state in their annual report:

QuoteWe have set a two-pronged strategy for our business development,
organic growth and acquisitions. We plan to continue this strategy in 2006.

The privatization of state owned pharmaceutical industries in China offers a great opportunity for AOB and as they have already filled the war chest any acquisitions during 2006 will most likely be accreditive to earnings.

In the absence of a large acquisition in 2006 I think it is highly unlikely that we will see any further dilution. The likely scenario is rather new acquisitions, which will add to EPS and further accelerate AOB's tremendous growth.

Fundamentally, the company earned $0.09 in Q4 2005. If no growth, it will be equal to $0.36 for 2006. At around $5.00, I did not see much risk to own this stock.

Short term, the stock has support at $5.0 then strong support at $4.50.

Resistance is at $5.5 then $6.00

Long term bullish.

American Oriental Bioengineering Reiterated At 'Buy/4,' Target Valuation $6 By Investrend Research Analyst Kipley Lytel, CFA
Monday , April 03, 2006 01:03 ET

(financialwire.net via COMTEX) -- April 3, 2006 (FinancialWire) (Investrend Research Syndicate) American Oriental Bioengineering (AMEX:AOB) has been reiterated at "Buy/4" with a 12-month Target Valuation of $6 in a year-end 4Q Update by Investrend Research analyst Kipley Lytel, CFA.

"Inasmuch as American Oriental Bioengineering demonstrated material operational traction on several fronts in 4QFY05 ' including growth in revenue, gross margin, net working capital and cash flow ' much of the absolute progress was diluted on an earnings per share basis (EPS) due to warrants and the private placement. Hence, the EBIT margin was relatively flat in 4QFY05 at 31.4% compared to 31.2% in the prior period quarter, while EPS also flat lined year-over-year at $0.08/share," said Lytel.

Lytel also stated:

Current assets were substantially bolstered by the new capital infusion with a $57.5M cash balance; which has yet to be deployed towards earnings generation in the form of acquisitions of brand name products, plants and/or distribution sources. Indeed, in the conference call, management indicated their aim to double capacity in FY06. The unique advantages for AOB's business model appears expertise, resources and scale in the high growth dual plant-based pharmaceutical and nutraceutical product category lines.

The company recently evaluated seven (7) target companies for acquisitions based on several criteria, including but not limited to: complement with core plant-based competency and industry; expansion of distribution channels with cross-selling potential; solid brand name; attractive valuation multiples, etc. American Oriental Bioengineering has set the acquisition bar high with the HSPL transaction, which had approximately $3M in revenue and 39% gross margin when purchased and now yields revenue of $16.2M with a 63% gross margin (FY05). The value-added of having expertise and capital combined with synergy of scale offers immense intermediate upside given the universe of potential targets was identified in the conference call as approximately 90 companies that fit the initial acquisition screen.

Management also indicated that it takes about six-months to close a transaction and with 'dead' money sitting in the coffer, it is reasonable to expect a host of acquisitions in FY06. Meanwhile, we anticipate the company to remain profitable and advance margins upward as the scale of the operations is expected to offset the costs/expenses associated with a series of relatively small acquisitions throughout the year.

American Oriental Bioengineering is following an active acquisition-driven growth strategy. Between 2001 and 2005, AOB's revenues were growing at a CAGR of 63%, with most growth occurring in 2003 and 2005, while 2005 showed a 71% year-over-year growth. Excluding the acquisition of HSPL, organic revenues grew 42.5% for 2005 as compared to 2004.

The company's PBP division reported $34.2 million in revenue, up 114.4 percent compared to last year. Growth in this segment was driven by sales increases of 226.7 percent in Shanghuanglian Anti-Virus Powder Injection, 79.8 percent increase in sales of the Cease Enuresis Soft Gel and Patch and a 50.8 percent increase in double grain beverage sales. Sales of PBN products were $20.5 million, an increase of 28.2 percent as compared to last year as the company saw increases in all related products due to increased marketing and distribution.

The company completed the quarter with $57.5 million in cash and cash equivalents, inclusive of the $11.2 million received from calling its class "B" warrants in October, 2005, and the Company's $60 million private placement in December, 2005. The company received the first traunche in connection with its private placement consummated in the fourth quarter resulting in gross proceeds of $33.5 million with the remaining $26.5 million of gross proceeds received by the Company in January 2006.

Net total proceeds received from the private placement in December 2005 and January 2006 were $56.4 million. This compares to $11.4 million in cash as of December 31, 2004. Short-term debt decreased $1.3 million to $3.7 million at the end of 2005 as compared to 2004. During the fourth quarter inventory declined by 53.2 percent and 13.3 percent as compared to the third quarter 2005 and fourth quarter 2004 respectively as the Company improved overall efficiency yielding increased inventory turns and reduced inventory days versus both periods.

During 2005, the company generated $11.6 million in positive cash flow from operations. The company's current ratio as of December 31, 2005, was 8.8-to-1 compared to a current ratio or 2.55 to 1 on December 31, 2004.

Quote from: shawFund on April 02, 2006, 10:17:36 AM
Fundamentally, the company earned $0.09 in Q4 2005. If no growth, it will be equal to $0.36 for 2006. At around $5.00, I did not see much risk to own this stock.

Short term, the stock has support at $5.0 then strong support at $4.50.

Resistance is at $5.5 then $6.00

Long term bullish.

I agree Shawfund - Long-term AOB is a great growth story.

The market is unfortunately very shortsighted and until we get some tangible news on acquisitions AOB might drift lower. For now this is the best we have to work with:

Quote from: la-onda on April 03, 2006, 08:38:08 AM
The company recently evaluated seven (7) target companies for acquisitions based on several criteria, including but not limited to: complement with core plant-based competency and industry; expansion of distribution channels with cross-selling potential; solid brand name; attractive valuation multiples, etc. American Oriental Bioengineering has set the acquisition bar high with the HSPL transaction, which had approximately $3M in revenue and 39% gross margin when purchased and now yields revenue of $16.2M with a 63% gross margin (FY05). The value-added of having expertise and capital combined with synergy of scale offers immense intermediate upside given the universe of potential targets was identified in the conference call as approximately 90 companies that fit the initial acquisition screen.

Management also indicated that it takes about six-months to close a transaction and with 'dead' money sitting in the coffer, it is reasonable to expect a host of acquisitions in FY06. Meanwhile, we anticipate the company to remain profitable and advance margins upward as the scale of the operations is expected to offset the costs/expenses associated with a series of relatively small acquisitions throughout the year.

The stock tried to rally at the end of trading but was rejected at MA50. Instead we ended with a long legged Doji in the middle of a chart pattern. This clearly indicates that the market don't know where to go from here.

I am sure that the stock will rally when they announce news about a concrete acquisition but as said the market is not very patient so we will keep our stop at 4.56.

Actually I think that the chart looks like the beginning of 2006 when there was a 15-20% jump.  Anyone following AOB knows that news attending the build-up in $$$ should occur relatively soon - we are already in month 4 of 2006.  I think that the fundamentals have finally caught back up to the share price and will hold....

AOB penetrated our stop briefly before the close and as this was an intra day stop we have sold AOB at 4.56 according to the plan

We will keep following news around AOB's potential acquisitions and if the right opportunity presents itself we might buy AOB back.

sold yesterday  ???
today news out:
American Oriental Bioengineering, Inc. Announces Acquisition of Guangxi Lingfeng Pharmaceutical Company (GLP); Acquisition Expands Product Line, Distribution Channels; Adds Complimentary Products in Women's Health Area
Tuesday , April 18, 2006 07:00 ET

HONG KONG, Apr 18, 2006 (BUSINESS WIRE) -- American Oriental Bioengineering, Inc. (AMEX:AOB), a company that produces and distributes a broad range of pharmaceutical and nutraceutical products throughout China, today announced the closing of the acquisition of Guangxi Lingfeng Pharmaceutical Company Limited (GLP), a pharmaceutical company, organized under the laws of China, specializing in manufacturing and distribution of plant-based medicines in China. GLP, based in Hezhou City, Guangxi, China, was founded in 1975. Over the past 30 years, GLP has developed a valuable product portfolio aimed at pediatrics, gynecopathy and the treatment of digestive and respiratory system illnesses.

Pursuant to the agreement, AOB acquired 100% ownership of GLP for a total consideration equal to 2.5 times GLP's prior fiscal year revenue. Based on unaudited financial statements consistent with Chinese GAAP, GLP generated revenue of over $10 million USD with positive net income for the year ended December 31, 2005. The purchase price is approximately $25 million, which consists of approximately $20 million USD in cash (subject to adjustments based on completion of US GAAP audits on GLP financial statements) and 1,200,000 shares of restricted common stock of AOB. Subsequent to the closing today, audited financials of GLP will be filed with the Securities and Exchange Commission within the time frame as stipulated by SEC rules.

AOB expects that the acquisition of GLP will extend AOB's product line into the area of women's health and create synergies between GLP's Jinji Series of drugs aimed to treat gynecological inflammations, such as endometritis, annexitis, and AOB's Cease Enuresis product line for the treatment of bedwetting and nighttime urination, primarily targeted at pregnant and post-pregnant women.

GLP has a portfolio of 70 products and operates a distribution network based in Beijing, which extends across China, with a particularly strong presence in Southern China where AOB has yet to establish a significant distribution network. The production facilities of GLP maintain a Good Manufacturing Practices (GMP) certificate as awarded by the Chinese Government and can produce a broad spectrum of delivery specifications, such as capsules, troches, granules, pills, syrups and tinctures.

Tony Liu, Chairman and Chief Executive Officer of AOB said, "GLP is an established and proven manufacturer of plant-based pharmaceuticals with a valuable brand, an extensive distribution network and the opportunity to capitalize on their under-utilized product portfolio. The Jinji Series of gynecological products will contribute to AOB's position in women's health products, which is a large and rapidly growing market in China."

Mr. Liu continued, "AOB expects to leverage GLP's proprietary product portfolio to improve the breadth of our product offerings. GLP also delivers strength in distribution in southern China where AOB has historically been under-represented. We are extremely excited about this acquisition and the financial and strategic value it represents. We believe, similar to the HSPL acquisition in 2004, GLP possesses both immediate value and tremendous upside potential for AOB and its shareholders."

AOB has broken out and up from all of its moving averages this week with decent volume.  With the recent acquisition last month which will dramatically increase revenues and looks like it will be accretive (and will also instantly create a new distribution network for existing AOB products) ... I am thinking that the fundamentals of AOB have finally caught up with the stock price and that it is ready for another move. 

Back in AOB.  Closed at $5.32 today.  Earnings come out on Friday.  Wondering if anyone had any thoughts in regards to holding through earnings.  I really like what this stock has to offer but it hasn't been able to break through $6.00.  Thanks in advanced'

Alien

nice results  >:D

American Oriental Bioengineering, Inc. Announces Revenue and Earnings for the First Quarter 2006; First Quarter Revenues Increase 98% versus Last Year: Net Income Increases 125%, EPS Increases 60%
Friday , May 12, 2006 08:29 ET

HONG KONG, May 12, 2006 (BUSINESS WIRE) -- American Oriental Bioengineering, Inc. (AMEX:AOB):

First Quarter 2006 Highlights:

-- Receipt of the Second Tranche of Proceeds in Connection with the December 2005 private placement

-- Operating margins expand to 33.4%, an improvement of over 2.0% versus 1Q 2005

-- Subsequent to the close of the First Quarter, Company announces the acquisition of GLP

American Oriental Bioengineering, Inc. (AMEX:AOB), an emerging Chinese manufacturer and distributor of plant-based pharmaceutical and nutraceutical products, today announced financial results for the first quarter ending March 31, 2006.

Key Financial Indicators
(All numbers in thousands, except per-share amounts in USD)

                                   Q1 2006  Q1 2005  Percentage Change
Revenues                          $ 19,087  $ 9,653        97.7%
Cost of goods sold                $  6,509  $ 3,628        79.4%
Gross Profit                      $ 12,577  $ 6,025       108.8%
Total Operating Expenses          $  6,194  $ 3,000       106.5%
Income from operations            $  6,383  $ 3,025       111.0%
Net Income                        $  4,917  $ 2,183       125.2%
EPS -- Fully Diluted              $   0.08  $  0.05        60.0%
Diluted Shares                       61.3M    42.7M        43.6%


The US dollar amounts are calculated based on the average conversion rate of US $1 to RMB 8.0436 for the first quarter of 2006 and US $1 to RMB 8.3 for the first quarter of 2005.

First Quarter 2006 Financial Results:

For the first quarter, the Company reported revenues of $19.1 million, an increase of 97.7 percent compared to the $9.7 million reported in the first quarter last year and down 3.5 percent compared to the $19.8 million reported in the fourth quarter of 2005. The increase in revenue as compared to the first quarter of last year is attributable to growth in both the Company's Plant-based Pharmaceutical (PBP) and Plant-based Nutraceutical (PBN) products. During the first quarter of 2006, sales of PBP products increased approximately $6.2 million, or 102.8 percent compared to the same period in 2005. PBP revenues were driven by a 137.9 percent increase in Cease Enuresis Soft Gel and Patch sales and a 101.6 percent increase in Shuanghuanlian Injection Powder sales. PBP revenue growth was also driven by continued strength in Double Ginseng Grain product sales, which increased 57.6 percent from the same period of last year. During the first quarter of 2006, PBN sales increased by $3.3 million or 89.4 percent compared to the same period last year as the Company continued to improve its marketing efforts geared towards educating consumers about the benefits of soy-based peptide products. PBN revenues were driven by a 122.9 percent increase in Soy Peptide Tablets and a 116.2 percent increase in Vitamate Oral Liquid sales.

On a sequential basis PBP revenue increased by 0.4 percent while PBN revenue decreased by 9.6 percent. The overall revenue decline on a sequential basis was due to seasonality, which the Company has experienced in the past, as the fourth quarter is traditionally strongest of the year. The Company's 3.5 percent sequential revenue decline in the first quarter of 2006 compares favorably to the 23.6 percent sequential decline in the first quarter of 2005.

Cost of goods sold were $6.5 million, an increase of 79.4 percent compared to the $3.6 million reported during the first quarter of 2005, resulting in a gross margin of 65.9 percent for the first quarter compared to 62.4 percent for the comparable period last year and 65.2 percent during the fourth quarter of 2005. Gross margins improved in the first quarter as the Company yielded higher efficiencies in its manufacturing processes, particularly versus the year-ago period as further improvements were made on the integration of HSPL.

Selling and marketing expenses increased 159.6 percent to $1.7 million. Advertising expenses increased 173.0 percent to $2.2 million, both compared to the first quarter of last year. Total operating expenses were $6.2 million, an increase of 106.5 percent compared to $3.0 million reported for the same period last year as the Company increased expenses to support operational growth.

Operating income increased to $6.4 million, up 111.0 percent from $3.0 million in the year-ago quarter. Operating margins were 33.4 percent, which improved 2.1 percent from 31.3 in the first quarter of 2005 and up 2.0 percent from 31.4 percent in the fourth quarter 2005. The Company continues to seek opportunities to rationalize costs and reduce inefficiencies to drive greater profitability.

The Company had an effective income tax rate during the quarter of 23.9 percent compared to 25.6 percent last year. This tax is in addition to the Value Added Tax (VAT) of 17.0 percent deducted from the Company's gross revenues each quarter. Net income increased 125.2 percent to $4.9 million or $0.08 per fully diluted share versus net income of $2.2 million or $0.05 per fully diluted share in the same period last year. Fully diluted earnings per share increased 60.0 percent as compared to last year and were flat sequentially despite a 43.6 percent and 18.8 percent increase in shares utilized in this calculation relative to the first quarter of 2005 and the fourth quarter of 2005, respectively.

Commenting on the first quarter of 2006, Mr. Tony Liu, Chairman and CEO of AOB, said, "We are very pleased to report a solid first quarter which resulted in strong revenue and earnings despite what is historically a weaker seasonal quarter. The Company experienced strength across all product lines which reflects the success of our efforts to continue to increase brand awareness and further penetrate underserved and rapidly growing markets throughout China."

Balance Sheet

The Company completed the quarter with $80.9 million in cash and cash equivalents. Cash and cash equivalents increased from $57.5 million during the fourth quarter of 2005 primarily as a result of $3.9 million in positive cash flow from operations and the receipt on January 23, 2006, of the second tranche of net cash proceeds of $25.0 million in connection with the $60.0 million private placement effected in December 2005. Short-term debt totaled $3.7 million and was down $1.4 million versus the year-ago period and unchanged from the fourth quarter of last year. Inventory increased 4.5 percent and 64.5 percent from the first quarter of 2005 and fourth quarter of 2005 respectively to $8.1 million. The increase in inventory was below that of overall sales growth for the first quarter with the increase necessary to support the Company's future growth. The Company continues to have excellent quality receivables with overall Days Sales Outstanding (DSO) unchanged from last year at 45 days. As of March 31, 2006, the Company had a current ratio of 11.24 to 1 as compared to a current ratio of 2.68 to 1 on March 31, 2005.

Mr. Liu continued, "In addition to remarkable organic growth dynamics in our existing products and markets, there continues to be a tremendous opportunity to make strategic and accretive acquisitions in China. While there are other companies that may also have an interest in pursuing these acquisitions, AOB has a unique ability to identify, access and complete the due diligence on these deals and more importantly, possesses the necessary expertise to leverage these opportunities and to successfully integrate the operations of these businesses into AOB. We remain focused on identifying acquisitions that will either enhance our presence in the PBP or PBN marketplace or broaden our distribution network for existing products. The recently completed acquisition of GLP has positioned AOB to accomplish both objectives. The product portfolio we acquired from GLP is complementary to our existing offering in the area of women's health and we believe we can significantly grow GLP revenues by improving the execution of sales and marketing programs and introducing AOB methodologies, which were so successful in the HSPL acquisition. The acquisition of GLP is also important for AOB as it further expands our geographic reach to southern part of China."

Mr. Liu concluded, "We continue to believe that we can meaningfully grow our revenues organically and through acquisitions. We are very well-positioned to execute on this strategy with a talented and experienced management team, a broad and deep existing product portfolio and a healthy balance sheet. We look forward with great anticipation to continued success in 2006."

AOB trading up in pre-market.  Not a big run up pre earnings, maybe they will be able to break 6.00.  We shall see. ::)

Good luck to anyone holding.....Alien

AOB is up in pre-market because they announced earnings half an hour ago! :)


http://biz.yahoo.com/bw/060512/20060512005166.html?.v=1
American Oriental Bioengineering, Inc. Announces Revenue and Earnings for the First Quarter 2006
Friday May 12, 8:29 am ET 
First Quarter Revenues Increase 98% versus Last Year: Net Income Increases 125%, EPS Increases 60%


HONG KONG--(BUSINESS WIRE)--May 12, 2006--American Oriental Bioengineering, Inc. (AMEX:AOB - News):
First Quarter 2006 Highlights:

Receipt of the Second Tranche of Proceeds in Connection with the December 2005 private placement
Operating margins expand to 33.4%, an improvement of over 2.0% versus 1Q 2005
Subsequent to the close of the First Quarter, Company announces the acquisition of GLP
American Oriental Bioengineering, Inc. (AMEX:AOB - News), an emerging Chinese manufacturer and distributor of plant-based pharmaceutical and nutraceutical products, today announced financial results for the first quarter ending March 31, 2006.

Key Financial Indicators
(All numbers in thousands, except per-share amounts in USD)

                                   Q1 2006  Q1 2005  Percentage Change
Revenues                          $ 19,087  $ 9,653        97.7%
Cost of goods sold                $  6,509  $ 3,628        79.4%
Gross Profit                      $ 12,577  $ 6,025       108.8%
Total Operating Expenses          $  6,194  $ 3,000       106.5%
Income from operations            $  6,383  $ 3,025       111.0%
Net Income                        $  4,917  $ 2,183       125.2%
EPS -- Fully Diluted              $   0.08  $  0.05        60.0%
Diluted Shares                       61.3M    42.7M        43.6%

The US dollar amounts are calculated based on the average conversion rate of US $1 to RMB 8.0436 for the first quarter of 2006 and US $1 to RMB 8.3 for the first quarter of 2005.

First Quarter 2006 Financial Results:

For the first quarter, the Company reported revenues of $19.1 million, an increase of 97.7 percent compared to the $9.7 million reported in the first quarter last year and down 3.5 percent compared to the $19.8 million reported in the fourth quarter of 2005. The increase in revenue as compared to the first quarter of last year is attributable to growth in both the Company's Plant-based Pharmaceutical (PBP) and Plant-based Nutraceutical (PBN) products. During the first quarter of 2006, sales of PBP products increased approximately $6.2 million, or 102.8 percent compared to the same period in 2005. PBP revenues were driven by a 137.9 percent increase in Cease Enuresis Soft Gel and Patch sales and a 101.6 percent increase in Shuanghuanlian Injection Powder sales. PBP revenue growth was also driven by continued strength in Double Ginseng Grain product sales, which increased 57.6 percent from the same period of last year. During the first quarter of 2006, PBN sales increased by $3.3 million or 89.4 percent compared to the same period last year as the Company continued to improve its marketing efforts geared towards educating consumers about the benefits of soy-based peptide products. PBN revenues were driven by a 122.9 percent increase in Soy Peptide Tablets and a 116.2 percent increase in Vitamate Oral Liquid sales.

On a sequential basis PBP revenue increased by 0.4 percent while PBN revenue decreased by 9.6 percent. The overall revenue decline on a sequential basis was due to seasonality, which the Company has experienced in the past, as the fourth quarter is traditionally strongest of the year. The Company's 3.5 percent sequential revenue decline in the first quarter of 2006 compares favorably to the 23.6 percent sequential decline in the first quarter of 2005.

Cost of goods sold were $6.5 million, an increase of 79.4 percent compared to the $3.6 million reported during the first quarter of 2005, resulting in a gross margin of 65.9 percent for the first quarter compared to 62.4 percent for the comparable period last year and 65.2 percent during the fourth quarter of 2005. Gross margins improved in the first quarter as the Company yielded higher efficiencies in its manufacturing processes, particularly versus the year-ago period as further improvements were made on the integration of HSPL.

Selling and marketing expenses increased 159.6 percent to $1.7 million. Advertising expenses increased 173.0 percent to $2.2 million, both compared to the first quarter of last year. Total operating expenses were $6.2 million, an increase of 106.5 percent compared to $3.0 million reported for the same period last year as the Company increased expenses to support operational growth.

Operating income increased to $6.4 million, up 111.0 percent from $3.0 million in the year-ago quarter. Operating margins were 33.4 percent, which improved 2.1 percent from 31.3 in the first quarter of 2005 and up 2.0 percent from 31.4 percent in the fourth quarter 2005. The Company continues to seek opportunities to rationalize costs and reduce inefficiencies to drive greater profitability.

The Company had an effective income tax rate during the quarter of 23.9 percent compared to 25.6 percent last year. This tax is in addition to the Value Added Tax (VAT) of 17.0 percent deducted from the Company's gross revenues each quarter. Net income increased 125.2 percent to $4.9 million or $0.08 per fully diluted share versus net income of $2.2 million or $0.05 per fully diluted share in the same period last year. Fully diluted earnings per share increased 60.0 percent as compared to last year and were flat sequentially despite a 43.6 percent and 18.8 percent increase in shares utilized in this calculation relative to the first quarter of 2005 and the fourth quarter of 2005, respectively.

Commenting on the first quarter of 2006, Mr. Tony Liu, Chairman and CEO of AOB, said, "We are very pleased to report a solid first quarter which resulted in strong revenue and earnings despite what is historically a weaker seasonal quarter. The Company experienced strength across all product lines which reflects the success of our efforts to continue to increase brand awareness and further penetrate underserved and rapidly growing markets throughout China."

Balance Sheet

The Company completed the quarter with $80.9 million in cash and cash equivalents. Cash and cash equivalents increased from $57.5 million during the fourth quarter of 2005 primarily as a result of $3.9 million in positive cash flow from operations and the receipt on January 23, 2006, of the second tranche of net cash proceeds of $25.0 million in connection with the $60.0 million private placement effected in December 2005. Short-term debt totaled $3.7 million and was down $1.4 million versus the year-ago period and unchanged from the fourth quarter of last year. Inventory increased 4.5 percent and 64.5 percent from the first quarter of 2005 and fourth quarter of 2005 respectively to $8.1 million. The increase in inventory was below that of overall sales growth for the first quarter with the increase necessary to support the Company's future growth. The Company continues to have excellent quality receivables with overall Days Sales Outstanding (DSO) unchanged from last year at 45 days. As of March 31, 2006, the Company had a current ratio of 11.24 to 1 as compared to a current ratio of 2.68 to 1 on March 31, 2005.

Mr. Liu continued, "In addition to remarkable organic growth dynamics in our existing products and markets, there continues to be a tremendous opportunity to make strategic and accretive acquisitions in China. While there are other companies that may also have an interest in pursuing these acquisitions, AOB has a unique ability to identify, access and complete the due diligence on these deals and more importantly, possesses the necessary expertise to leverage these opportunities and to successfully integrate the operations of these businesses into AOB. We remain focused on identifying acquisitions that will either enhance our presence in the PBP or PBN marketplace or broaden our distribution network for existing products. The recently completed acquisition of GLP has positioned AOB to accomplish both objectives. The product portfolio we acquired from GLP is complementary to our existing offering in the area of women's health and we believe we can significantly grow GLP revenues by improving the execution of sales and marketing programs and introducing AOB methodologies, which were so successful in the HSPL acquisition. The acquisition of GLP is also important for AOB as it further expands our geographic reach to southern part of China."

Mr. Liu concluded, "We continue to believe that we can meaningfully grow our revenues organically and through acquisitions. We are very well-positioned to execute on this strategy with a talented and experienced management team, a broad and deep existing product portfolio and a healthy balance sheet. We look forward with great anticipation to continued success in 2006."

Thanks Se7en, I had not seen these results.  Looks alright. ;)

Alien

Thought this one was sold on April 11th.

Was it bought again for the 3Stocks of Value or did I miss something ???

jorgegr

jorgegr, you are right, sold on the 11th  ???

BO Alert after execellent results

I am bringing back AOB on the table... correction is done ready to make new highs ;)
All Indicators are returning bullish ;)

yeah AOB looks good on monday.

Mike,

Isn't it time we add this one back to 3SOV?  I think I will depending on how it closes.

I jumped in at $5.95, it just looks so strong.....let see how this breakout plays out.  AOB, together with IVHG, KOMG, and WDPT are the only green I see in my portfolio today; I guess it could always be worse.

Restarting position AOB:

AOB is showing a lot of strength in this market!  A very bullish move closing over $6 resistance today.. at the same time the market might be ripe for a bit of a bounce.  ;)  This run started after an excellent earnings release.

QuoteAmerican Oriental Bioengineering, Inc. Announces Revenue and Earnings for the First Quarter 2006
Friday May 12, 8:29 am ET
First Quarter Revenues Increase 98% versus Last Year: Net Income Increases 125%, EPS Increases 60%
http://biz.yahoo.com/bw/060512/20060512005166.html?.v=1

All moving averages below providing support.  We are looking for AOB to attack its 52-week high on this run.  Since AOB had a very clear strong day yesterday it is possible that it will gap.  We will try to buy under 6.45 in the morning.  8)


We will buy AOB below 6.45 on 5/16.

Quote from: eliteG on May 16, 2006, 12:13:56 AM

Restarting position AOB:

AOB is showing a lot of strength in this market!  A very bullish move closing over $6 resistance today.. at the same time the market might be ripe for a bit of a bounce.  ;)  This run started after an excellent earnings release.

QuoteAmerican Oriental Bioengineering, Inc. Announces Revenue and Earnings for the First Quarter 2006
Friday May 12, 8:29 am ET
First Quarter Revenues Increase 98% versus Last Year: Net Income Increases 125%, EPS Increases 60%
http://biz.yahoo.com/bw/060512/20060512005166.html?.v=1

All moving averages below providing support.  We are looking for AOB to attack its 52-week high on this run.  Since AOB had a very clear strong day yesterday it is possible that it will gap.  We will try to buy under 6.45 in the morning.  8)


We will buy AOB below 6.45 on 5/16.

I have always liked this stock, glad to see it back on 3SOF!  Count me in tomorrow too!

AOB is already up less than 30% in 9 sessions... I think it is a good idea to wait for the pullback then get IN... ;)

what do u think G? ;)

I was in and out of AOB today... In at 5.70 out at 6.00. I was getting little itchy with the market being sproadic during the day. I dont know how tomorrow looks if the market is ugly can slow down AOB. Im going to watch AOB see if it goes to low 6s I may try adding there.

Quote from: nullzero on May 16, 2006, 01:24:42 AM
I was in and out of AOB today... In at 5.70 out at 6.00. I was getting little itchy with the market being sproadic during the day. I dont know how tomorrow looks if the market is ugly can slow down AOB. Im going to watch AOB see if it goes to low 6s I may try adding there.

Good trade nullzero ;)
3SOF should start looking stocks to short.... we can have 1 or 2 that would be fine ;)

A stock that is up on big down days and has broken key resistance has very high strength, that is AOB right now.

Think we should wait here for pullback.
Value on AOB is only $7.50

China Venture Forum: China Stocks to Watch for Monday, May 15, 2006
Monday , May 15, 2006 10:52 ET

Shanghai, China, May 15, 2006 (M2 PRESSWIRE via COMTEX) -- China Venture Forum, a leading equity research newsletter of micro- and small-cap China Stocks, announced China stocks to watch for Monday, May 15, 2006 include American Oriental Bioengineering, Inc. (AMEX:AOB).

American Oriental Bioengineering, Inc. (AMEX:AOB), an emerging Chinese manufacturer and distributor of plant-based pharmaceutical and nutraceutical products, Friday announced financial results for the first quarter ending March 31, 2006. Net income jumped to $4.9 million, or 8 cents per share, compared with $2.2 million, or 5 cents per share, during the year-ago period. The number of shares outstanding increased to 61.3 million from 42.7 million. AOB traded up 9.34% to close at $5.62 per share with over 5 million shares changed hands. Revenue climbed 98 percent to $19.1 million from $9.7 million last year. If AOB can keep current growth, the stock appears to be cheap at this level.

Quote from: yukiii on May 16, 2006, 02:01:34 AM
Think we should wait here for pullback.
Value on AOB is only $7.50

Quote from: Terliso on May 16, 2006, 01:18:02 AM
AOB is already up less than 30% in 9 sessions... I think it is a good idea to wait for the pullback then get IN... ;)

Pullback...... better price ;)

Got in at 6.00 could of gotten 5.90 40 mins later but oh well.

G and Ramsburg,

This is the second day I did not get the daily update (email).

I just realized 3SOF added AOB.

Thank you very much,

Rafael

Do you guys see a possible touch of supprt around 5.50 area, at least in a possible intraday retracement??????

update AOB:

AOB paused but created another lower high so momentum is still with the bulls.  Consolidation at these levels would be healthy but of course we would rather AOB just ran straight up.  Lets see what the rest of the week has in store for AOB.

------
Position: bought AOB @ 6.00 on 05/16/2006
Order: Hold
Exit: n/a
Target: n/a
------

It hit the former break out level and 9-day so usually a good buy point http://tinyurl.com/zrps4

Ok I admit I am not much of a technical guy.  I usually just eye-ball charts but here's the problem.  This stock had great earnings, then profit taking yestreday.  However look at what happened today.  It gapped down... not only that it went down from there.  I think there's a lot of reason to be cautious on this one now.

update AOB:

AOB gapped down and put in a nice high wave candle(long shadows small body in the middle).  Potentially setting us up for a bullish island reversal.  The market has been tough on our long plays but we will give AOB a bit of room by putting in a stop just below the 20ema.

------
Position: bought AOB @ 6.00 on 05/16/2006
Order: Hold
Exit: stop @ 5.20
Target: n/a
------

hi,
the battle is at 5.74  bulls and bears. who will win?

update AOB:

AOB closed with a nice sign of support on Monday.  Volume increased and we saw some downward price rejection and a 20ema pierce(a bullish sign).  Just missed our stop by 5cents and now ready to head higher.

------
Position: bought AOB @ 6.00 on 05/16/2006
Order: Hold
Exit: stop @ 5.20
------

fyi:
AOB: Short Interest DN 10.8% to 539.5K in May 2006
Friday , May 19, 2006 16:00 ET

According to new short interest data from AMEX, short interest for American Oriental Bioengineering Inc (AMEX: AOB) DECREASED 10.8% to 539,500 shares for the month ended mid-May, 2006.

SYMBOL         APRIL             MAY          CHANGE       %CHANGE      DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
AOB              605,071         539,500         -65,571       -10.84%           1

Based on AOB's 20-day average daily share volume of 1,323,245, it would require approximately 1 day(s) of buying to cover this short interest.

updated AOB analysis, please check my attached pdf file !!!
>:D

nice chart action today  ;D

American Oriental Bioengineering, Inc. Provides Update on the Acquisition of Guangxi Lingfeng Pharmaceutical
Thursday July 13, 9:30 am ET

HONG KONG--(BUSINESS WIRE)--July 13, 2006--American Oriental Bioengineering, Inc. (AMEX: AOB - News):

    * Marketing Initiatives in Place to Improve Sales
    * Synergies Identified to Expand GLP Margins
    * AOB Engages Ms. Ni Ping as Company Spokesperson
    * Acquisition Expected to Positively Contribute to 2Q06 and Full Year 2006; Revenues, Net Income and EPS

American Oriental Bioengineering, Inc. (AMEX: AOB - News), a leading manufacturer and distributor of pharmaceutical and nutraceutical products in China, provides update on the acquisition of Guangxi Lingfeng Pharmaceutical Company Limited (GLP). GLP is a manufacturer of plant-based pharmaceutical products in China, specializing in pediatrics, gynecopathy and medicines for the treatment of digestive and respiratory system illnesses.

"We are pleased to report that the integration of GLP has been progressing according to plan and we believe we have identified several areas where we can improve sales and reduce expenses to drive higher overall efficiency," commented Tony Liu, Chairman and Chief Executive Officer. "Similar to our acquisition of HSPL in September of 2004, where we improved sales by more than 300 percent and gross margins by nearly 20 percent in just over 12 months from the closing, we intend to create incremental value from our acquisition of GLP."

The acquisition of GLP has significantly expanded the plant based product (PBP) portfolio of AOB, contributing 70 potential products to the Company's existing PBP product offering. The acquisition of GLP has also increased AOB's points of distribution, particularly in Southern China, which has enabled the Company to better leverage its entire portfolio of PBP and plant based nutraceutical (PBN) products. GLP's flagship products, known as the Jinji Series, treat gynecological inflammations, such as endometritis and annexitis and are complementary to AOB's Cease Enuresis products for the treatment of bedwetting and nighttime urination.

In an effort to take advantage of its robust product portfolio, AOB has retained Ms. Ni Ping as the Company's official spokesperson. Ms. Ni Ping is a well known actor and television host within China, for her role in "Variety Wonderland", a primetime weekend special airing since 1990 and as the host of "Spring Festival Evening Party" which is estimated to have attracted more than one billion cumulative viewers during her tenure. With a now dedicated marketing budget, available resources and AOB's operational expertise, management's strategy is to improve GLP sales and profits from current levels.

"During the second quarter we will recognize over two months of contribution from GLP and expect the business to positively impact our reported results," Mr. Liu added. "Furthermore, I look forward to updating investors on our progress during our second quarter earnings conference call in August."

Moving up in anticipation of earnings on Monday.  Low today on 200ma and break above 50ma.  Terliso's 3 magics are right underneath. ;D  This ran about 20% after May earnings were reported and there is certainly the potential for a repeat next week.

fyi:

American Oriental Bioengineering, Inc. Announces Strong Fourth Quarter Orders for GLP Products
Wednesday September 27, 8:58 am ET
-- As of September 24, the Company has received over $6 million in Initial Orders for GLP's Jinji Series of Products for the Fourth Quarter
-- The Company Anticipates a further Increase in Order Momentum for GLP Products

NEW YORK--(BUSINESS WIRE)--American Oriental Bioengineering, Inc. (AMEX: AOB - News), a leading manufacturer and distributor of plant-based pharmaceutical and nutraceutical products in China, today announced GLP has received over $6.0 million in orders for its Jinji Series of products which are expected to be delivered during the fourth quarter.


By leveraging AOB's marketing methodologies, its expanded distribution points and new advertising and marketing campaigns, AOB has begun to see an accelerating pace of business for GLP products. Specifically, the Company hired Ms. Ni Ping, a well known and recognized Chinese celebrity to endorse the Jinji Series of products which targets women's health. Additionally, AOB has implemented a comprehensive training program geared to further educating GLP salespeople and improving the overall level of sales execution. GLP's position in the market is strengthening as the products now have nationwide access to China through AOB's 100,000 distribution points.

"We are very pleased to see a further increase in revenue from our integration of GLP since April," commented Mr. Tony Liu, Chairman and Chief Executive Officer of AOB. "This level of order activity prior to the start of a quarter represents a record for GLP and we are comfortable with our manufacturing capacity to address further anticipated revenue growth. Strong demand for the products has necessitated AOB to manufacture during the China National Day Holiday, a time when many facilities are closed. We remain committed to establishing the Jinji Series as a top three brand in women's health in China and having the brand contribute significantly to AOB's total revenue."

nice AOB chart action....

Michael,
any update from your side ?

cheers
O.

 ;D ;D ;D
anyone know why this stock is jumping, I am in at 5.03 and very happy I have held on through the last bit.   

any ideas what the future looks like --- are all the synergies finally starting to come together?

still climbing  >:D

anybody else except of bw6458 holding this stock?

cheers
O.

Hi la-onda,

I'm also still holding. Still climbing, only $ 0,83 away from one year high. Looking very good. Wonder what's up? Any ideas?

Good luck,
Amarens

ps: Sorry, uploading charts is not working from the laptop I'm on.

sound good IMO

American Oriental Bioengineering, Inc. Announces Preliminary Results for Third Quarter 2006
Monday October 23, 9:24 am ET
-- Company Expects to Report Revenue of Approximately $27 million for Third Quarter and EPS of at least $0.11; Representing 102% and 38% Increase from Last Year
-- Earnings Conference Call Scheduled for November 14, 2006 at 4:45 PM EST to Discuss Final Results

NEW YORK--(BUSINESS WIRE)--American Oriental Bioengineering, Inc. (AMEX: AOB - News), a leading manufacturer and distributor of plant-based pharmaceutical and nutraceutical products in China, today announced preliminary results for the third quarter 2006 and the date for the Company's third quarter conference call to discuss final results.

The Company expects to report revenue of approximately $27 million for the third quarter 2006, which would represent a 102 percent increase from the third quarter of last year based on continued strength across all major product lines. AOB expects to report earnings per share of at least $0.11 for the third quarter 2006, which would represent 38 percent increase from last year.

Management will conduct a conference call on November 14, 2006 to announce final third quarter 2006 results. During that time management will provide further financial details in regards to the third quarter.

The conference call will take place at 4:45 p.m. ET. Interested participants should call 888-243-1152 when calling within the United States or 973-582-2868 when calling internationally. There will be a playback available until Nov 21, 2006. To listen to the playback, please call 877-519-4471 when calling within the United States or 973-341-3080 when calling internationally. Please use pass code 8024117 for the replay.

This call is being webcast by ViaVid Broadcasting and can be accessed at American Oriental Bioengineering's Web site at http://www.bioaobo.com. The webcast may also be accessed at ViaVid's Web site at www.viavid.net. The webcast can be accessed until December 14, 2006 on either site.

marketwatch quotation:
American Oriential Bioengineering
AOB7.50, +0.21, +2.9% ) , too, has recently broken out of a long base, which in this case was a one-year coiling pattern. The break began at the end of September in the 5 area and took the stock to a nominal new all-time high just under 8 last week before backing off on Thursday and Friday. AOB had an even larger percentage run back in 2005 when it exploded off the May 2005 bottom near 1 and ran up nearly eight-fold in six months before the one-year coiling consolidation began. Often the longer the base, the bigger the breakout, and the stock's long breathing period has given it, in our view, additional room to run. Our short-term trading target is 9, intermediate target 12, and longer-term target around 15 or so. Short-term support is around the 6.5 to 7 zone.

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B58C66FED%2DD616%2D4CCE%2DBB24%2DC69344E4F45A%7D&source=blq%2Fyhoo&dist=yhoo&siteid=yhoo

up again... ;)

wow  >:D

American Oriental Bioengineering Inc. Reports Record Quarterly Revenue and Earnings and Provides Guidance for Fourth Quarter 2006
Business Wire - November 14, 2006 4:01 PM ET

Related Quotes
Symbol         Last    Chg
AOB    Trade    8.43    +0.04
Real time quote.


American Oriental Bioengineering Inc. (AMEX: AOB)

Third Quarter 2006 Highlights:

-- Organic Revenue Growth of 63% during the Quarter

-- Consolidated Gross Margins improve 3.5% versus last year to 66.9%

-- Management Expects Fourth Quarter Revenue to be in the range of $37 million to $39 million and at least $0.15 in EPS

American Oriental Bioengineering Inc. (AMEX: AOB), a leading Chinese manufacturer and distributor of plant-based pharmaceutical and nutraceutical products, today announced financial results for the third quarter ended September 30, 2006.

Key Financial Indicators
(All numbers in thousands, except per-share amounts in USD)

                                     Q32006    Q32005   Percent Change

Revenues                            $27,075   $13,407       101.9%
Cost of goods sold                  $ 8,975   $ 4,912       82.7%
Gross Profit                        $18,099   $ 8,495       113.1%
Total Operating Expenses            $ 8,746   $ 3,857       126.8%
Income from Operations              $ 9,353   $ 4,639       101.6%
Net Income                          $ 7,551   $ 3,710       103.5%
EPS--Fully Diluted                  $  0.12   $  0.08       50.0%


The U.S. Dollar amounts are calculated based on the average conversion rate of US $1 to 7.9087 RMB for the third quarter 2006 and US $1 to 8.0920 RMB for the third quarter 2005.

Third Quarter 2006 Results

For the third quarter 2006, the Company reported revenues of $27.1 million, an increase of 101.9 percent compared to $13.4 million in the third quarter of last year. The increase in total revenues for the quarter from last year was driven by strong organic growth in the Company's Plant-based Pharmaceutical (PBP) and Plant-based Nutraceutical (PBN) line of products and as a result of continuing momentum from the acquisition of Guangxi Lingfeng Pharmaceutical Co. Ltd. (GLP) earlier this year. During the third quarter, PBP sales, including GLP products, increased by 130.5 percent to $19.9 million compared to the third quarter last year. Sales of the Company's Cease Enuresis Soft Gel and Patch increased 117.8 percent to $6.6 million as compared to last year with sales of the Company's Shuanghuanlian Injection Powder increasing 51.5 percent to $6.5 million. GLP revenues totaled $5.2 million which improved 72 percent sequentially as compared to the second quarter 2006. There were no revenues from GLP during the third quarter of last year. Sales of PBN products in the third quarter 2006 totaled $7.2 million, representing a 50.3 percent increase from $4.8 million last year. PBN sales benefited from growth in several of the Company's products with the greatest impact as a result of an 82.4 percent increase versus the comparable quarter last year in the sale of Protein Peptide series products to $6.4 million. The Company continues to benefit from increased marketing efforts leading to better brand awareness and increased penetration.

"I am pleased to report that our business continues to experience strong momentum as we reported the highest quarterly revenue and net income in the Company's history as we continue to penetrate the Chinese market and reinvigorate consumer brand awareness for GLP products in the women's health market," commented Tony Liu, Chairman and CEO of AOB. "We are pleased with the performance of our most recent initiatives, which include increased advertising and the expansion of our distribution channels through the acquisition of HQPL, as AOB becomes a recognized brand across China. We believe our orders for GLP products scheduled for delivery in the fourth quarter will exceed our projection of $6 million announced at the end of September."

Cost of goods sold were $9.0 million during the third quarter, representing an increase of 82.7 percent, compared to $4.9 million in the same period last year. Gross margins for the period were 66.9 percent compared to 63.4 percent last year as the Company improved gross margins through operating cost management, sourcing and an increase in operational efficiencies.

Total operating expenses for the third quarter were $8.8 million which represented an increase of 126.8 percent versus last year as the Company experienced growth in all expense items to support revenue growth. Advertising expense increased the largest on an absolute dollar and percentage basis to $3.6 million which was up 376.8 percent versus the comparable quarter last year as the Company looked to reinforce the benefits of its key PBP and PBN products in the market. Selling and marketing expense increased 162.4 percent to $2.2 million as the Company increased several functions consistent with further growth in the business. General and administrative expenses increased 14.6 percent year over year to $2.2 million and decreased as a percentage of sales to 8.2 percent compared to 14.5 percent last year as management diligently controlled expense in this area and improved overall efficiency. As a result of strong revenue growth and gross margin expansion operating income increased 101.6 percent versus the comparable quarter last year to $9.4 million. Operating margins were 34.5 percent for the quarter which was relatively unchanged from last year but improved 3.8 percent from the second quarter 2006.

The Company's income tax rate decreased slightly to 20.2 percent compared to 23.3 percent last year as the Company benefited from favorable tax treatment surrounding the acquisition of GLP. Net income increased to 103.5 percent to $7.6 million or $0.12 per fully diluted share compared to $3.7 million or $0.08 last year. Earnings per share increased 50 percent versus the third quarter 2005.

For the nine month period ending September 30, 2006 revenues increased 98.0 percent to $69.2 million. Organic growth, which excludes the contribution from GLP, was 74.5 percent. PBP revenues increased 118.6 percent to $48.2 million. PBN revenues increased 62.9 percent to $21.0 million. Gross profit increased 107.1 percent to $46.0 million with gross margins of 66.5 percent compared to 63.6 percent last year. Gross margins increased as a result of the factors mentioned previously. Operating income for the nine month period was $22.8 million representing an 87.7 percent increase with operating margins of 32.9 percent as compared to 34.7 percent last year. Net income increased 99.1 percent to $18.4 million or $0.30 per weighted average fully diluted share compared to $9.2 million or $0.22 per weighted average fully diluted share for the comparable period last year. Earnings per share increased over 36 percent for the period.

The Company completed the quarter with $71.9 million in cash which increased $14.3 million from the end of 2005. Total debt at the end of the third quarter was $11.0 million versus $3.7 million at the end of 2005 with the increase primarily as a result of the GLP acquisition. Inventory increased 19.8 percent to $12.6 million versus the third quarter last year. Accounts receivable increased 24.3 percent to $9.6 million with respective Days Sales Outstanding (DSO) decreasing 30 days from the third quarter 2005 to 32 days. As a result of a significant increase in net income through the first nine months of 2006 and improving working capital management, cash flow from operations was $15.1 million with respective free cash flow of $11.8 million. Shareholders equity improved 55.9 percent from the end of 2005 to $141.2 million.

Mr. Liu concluded, "Based on improving visibility and confidence in our business we are going to begin providing quarterly revenue and earnings per share guidance beginning with our fourth quarter 2006 results. At this time we expect the fourth quarter revenue to be in the range of $37 million to $39 million with diluted earnings per share of at least $0.15, which would represent approximately 88 percent to 98 percent revenue growth from the comparable quarter last year with EPS increasing approximately 67 percent versus last year."

Based on the Company's fourth quarter 2006 financial expectations, revenue for the 2006 fiscal year is anticipated to be in the range of $106 million to $108 million. Fiscal 2006 EPS is anticipated to be at least $0.45 per fully diluted share.

is this a high flat pattern ?

This one should really have been for the long term. I reccomended it to my Dad (Mr Long term) at the time and he just now doubled his money. Thanks for the heads up Dave. :)

uc.

The little $2 stock is now $12.09. I was in $2.5, sold at $7.4. Back @9.5 and holding for the new highs on NYSE.

AOB seems to have a lot of juice.  I have been following this stock for a while.

Smart money upgraded their target to $16.  Any comments on Brean Murray stock rating credibility?

http://www.smartmoney.com/eqsnaps/index.cfm?story=ratings&symbol=AOB

What do you guys think?

From Mr. Market - entertaining, but usually the kiss of death:

Ever go out drinking all night and come home tired with a belly full of
beer?  Everything is excellent and you are more than prepared to sleep
like a baby.  You throw your clothes all over the room and then dive
into bed.  Another Saturday night success! 

All of a sudden you start having these weird dreams.  YouÂ're driving
in a car and need to pull over to the side of the road to go siss.  Or,
youÂ're at a football game and you get up to go to the menÂ's room and
you canÂ't find it.  Or youÂ're back in high school, and you ask the
teacher for a hall pass, and he doesnÂ't give it to you.  Finally, you
wake up with the revelation that you have to go siss like a Russian race
horse.  So you go to your bathroom, open up your fire hose, take care
of bitness and go try to go back to sleep.  The only problem is that now
your head is throbbing like 10 pounds of poop in a 3 pound bag.

Or how about this scenario?  You schedule a morning meeting at 10 am. 
This way you get to sleep an extra hour.  But at 6 am, you get that
urge to go siss.  You get up and take care of bitness, but now you canÂ't
go back to sleep.

Or how about this story?  Titan Omega went up on the roof to siss.   He
gets too close to the edge and takes the fast elevator down.

Or how about this story?  A Yale graduate and a Wharton MBA wakes up in
the middle of the night, sleepwalks to his refrigerator and waters his
lettuce.

http://images.blogstream.com/i/userImages/23/23025_6501.jpg

All of these stories are true and truth IS stranger than fiction.

WouldnÂ't it be great if there were some ancient Chinese herb you could
take to make you suppress the urge to go siss when you donÂ't really
have to?  Now you donÂ't have to dream.

Today I bought AOB, American Oriental Bioengineering, at 12.25.  I will
sell it in 4 - 6 weeks 14.15.  HereÂ's why I like AOB:

AOBÂ's stock is up 184% in the last 12 months, yet itÂ's still very
cheap.  Even though its present P/E is 33, itÂ's accelerating growth and
earnings puts its forward P/E ratio at only 22.   Look at this
chartÂ...itÂ's ramping up:

http://chart.finance.yahoo.com/c/1y/a/aob

American Oriental Bioengineering, Inc. engages in the development and
production of plant-based pharmaceutical (PBP) products and plant-based
nutraceutical (PBN) products in China. Its PBP products include cease
enuresis soft gel, which is used to alleviate bed-wetting and urination
disorder; double ginseng yishen grain that is used for neurosis,
vegetative nerve functional disturbance, and hypo-immunity; root of
red-rooted salvia tablet that improves blood circulation and blood flow to the
coronary artery to relieve pain, and is used for coronary ischemia and
angina pectoris caused by coronary heart disease; and urinstopper patch,
which is used to avoid frequent urination, urinal incontinence, and bed
wetting.

Their two big products are SoyPeptide Beverage.  The product contains
Soybean Peptide which is extracted from the Soy Protein Isolate through
enzyme reaction, is composed of 3 to 6 amino acid with molecular weight
less than 1,000d. Peptide is absorbed and digested by our body more
directly than amino acid, is low in sensitivity and zero in cholesterol
that is good to health. It also consists of complete plant protein, rich
in 9 kinds of essential amino acids that make rapid recovery of energy,
as well as accelerating the power of brain. Further, it is also good
for energy metabolism. This product is added with soybean peptide and
condensed ribes nigrum, which is rich in vitamins and minerals, is very
good to our health.

The other one is  Cease-enuresis soft gel
Chinese spelling：Yiniaoting Jiaonang
Ingredientsã€'Hulled seed cream of shinyleaf yellowhorn.
Characterã€' This products are in brown granules, slightly sweet and
acerbity in flavor
Pharmacological actionã€' This product can reduce micturition times of
water loading in mice; increase sphincter vesicae discharge frequency
of a rat, enlarging scope,as well as prolong discharge period, as a
result shrink sphincter vesicae. The in vitro studies  indicated this
product also can resist the shrinkage of white rat's bladder smooth muscle
caused by acetylcholine, as well as reduce its tension.  What?  No more
shrinkage?  Now I can go in the pool?

We all agree that medicine is getting expensive.  People, wisely, will
turn to non-prescription herbal products if they work.  How do you know
if they work?  Word of mouth is the tried and true way.  This stuff
actually seems to be working.  How do I know this?  Do people buy Ipods? 
People are buying AOBÂ's products.  It seems to work, and people like
telling their friends about it, especially if it works.

AOB has, in the last ten years, grown from a start-up in 1994 with
about $100,000 of revenue to become a leading manufacturer of plant-based
pharmaceutical products and plant-based nutraceutical products for the
rapidly growing Chinese market.  They operate in a large and growing
market. The total pharmaceutical and nutraceutical market in China was
approximately $62 billion in 2004. Demographic trends in this market are
favorable, as the Chinese population continues to grow and age and
economic expansion in China creates wealth, which serves to increase the
number of citizens who can afford healthcare. With the total market for
pharmaceutical products in China, herbal and plant-based pharmaceutical
remedies and products have an extensive history. Many Chinese consumers
and doctors rely upon the use of plant-based products for treatment of
a variety of different ailments, consistent with the Eastern philosophy
of health and wellness.   AOB's standing could open the way to a raft
of new biotech developed foods in China, particularly as the country
races to meet rising demand for processed foods in an effort to feed its
still burgeoning population – currently said to stand at 1.3 billion
people. The supply of soy products has proved particularly problematic in
recent years, leading the country to become a net importer of soybeans.

The company's research team reports that the growth of liver cancer
cells inside mice was Â'successfully suppressed' by soybean protein
peptides without side effects. Their findings could lead to future market
opportunities for the ingredient.  Soy is the most widely used botanical
by pre- and post-menopausal women but its use by men is also growing as
research continues to show the benefits on heart health. In the US, soy
sales have grown from $940 million in 1990 to a projected $4 billion
this year.

AOB currently has more than 100 products in their portfolio, all
plant-based in formulation divided into two key categories: plant-based
pharmaceuticals and plant-based nutraceuticals. PBP is the larger of the
CompanyÂ's two divisions as a percentage of revenue. PBP products in China
require approval from the state FDA and are administered both through
over-the-counter locations and through prescriptions at hospitals and
clinics. The two largest products in the PBP category are Shuanghuanglian
Powder Injection and Cease Enuresis Soft Gel. SLPI, our largest
contributing product, as a percent of total revenue is one of the only two PBP
herbal injections approved by the China state FDA for treating
anti-viral indications.   Cease Enuresis Soft Gel is approved by the China
state FDA as a prescription remedy for chronic bedwetting and nighttime
urination. Bedwetting is a serious problem affecting millions of children
and adults. Leveraging on our Cease-Enuresis Soft Gel and the newly
established research center, we believe the Company can capture a
substantial market share of serving patients suffering from enuresis or chronic
bedwetting syndrome

PBN is the smaller of the CompanyÂ's two divisions. PBN products are
not licensed by the China state FDA, but they generally require local
government approval and are typically sold over the counter at the retail
outlets. AOBOÂ's PBN division products soybean peptide products in
powder and liquid forms. Soybean peptide is a cholesterol-free
energy-boosting protein source that enhances the immune system and has anti-fatigue
benefits. AOBO also produces a line of nutritional products through the
PBN division, including the Three-Happiness nutritional drink, which
are rich in vitamins and amino acids to enhance well-being and to provide
energy The Three-Happiness product line is a recognized retail brand
name in China.

AOB owns a very recognizable brand in China with their Three-Happiness
nutritional beverages and the soy protein peptide line, and  have
developed and own two growing products within the PBP market, all of which
will benefit from further market penetration and expansion.

Their strategy is to grow organically by focusing on new product
development and expanding the application of PBP products. This strategic
component involves further penetrating existing markets, capitalizing on
the favorable macrodemographic trends, and expanding the established
distribution network.

How does this boil down to dead Presidents and Franklins?  You want the
truth?  You canÂ't handle the truth!  In November, AOB reported their
3rd quarter results for 2006:

Third Quarter 2006 Highlights:

-- Organic Revenue Growth of 63% during the Quarter
-- Consolidated Gross Margins improve 3.5% versus last year to 66.9%
-- Management Expects Fourth Quarter Revenue to be in the range of $37
million to $39 million and at least $0.15 in EPS

For the third quarter 2006, the Company reported revenues of $27.1
million, an increase of 101.9 percent compared to $13.4 million in the
third quarter of last year. The increase in total revenues for the quarter
from last year was driven by strong organic growth in the Company's
Plant-based Pharmaceutical (PBP) and Plant-based Nutraceutical (PBN) line
of products and as a result of continuing momentum from the acquisition
of Guangxi Lingfeng Pharmaceutical Co. Ltd. (GLP) earlier this year.
During the third quarter, PBP sales, including GLP products, increased by
130.5 percent to $19.9 million compared to the third quarter last year.
Sales of the Company's Cease Enuresis Soft Gel and Patch increased
117.8 percent to $6.6 million as compared to last year with sales of the
Company's Shuanghuanlian Injection Powder increasing 51.5 percent to $6.5
million.

We all know it makes money, but will this move the stock price? 
Remember the mantraÂ...earnings earnings  earnings.    ANAL-ysts say that AOB
will earn $0.10/share next quarter, $0.43/share for this year and
$0.58/share for next year.  Excuse me while I siss in my pants laughing.  AOB
is growing its revenues sequentially EACH QUARTER.  This growth is
ACCELERATING.  This is revenue growth, not just earnings growth.  Their
making it because their selling more stuff which means that their fixed
costs become smaller and smaller per unit sales so their overall margin
gets larger and larger.  The growth rate is ridiculous.  Why?

SimpleÂ...IÂ'm smarter than the ANAL-ysts and can determine this with my
Wharton MBA training. In July 2006, the company acquired HQPL, a
distributor of pharmaceutical products throughout China, for approximately $4
million.  This acquisition will substantially broaden the number of
distribution points for its product portfolio form 10,000 to 100,000, and
will enable AOB to sell throughout all regions of China.  This was
BRILLIANT strategy.
They can and will sustain this growth for at least another 3 quarters,
which $$$MR. MARKET$$$ says will earn them $0.46/share in 2006 on
revenues of $108 million.  When their products hit the street from these new
outlets, 2007 revenues will balloon to $206 million with EPS of $1.03. 
If you take the forward PE that the ANAL-ysts gave us (22) and multiply
it by $1.03, you get a share price of $22.66 which is well past my
target price. 
The boss is so excited I think he hasta go siss.

"I am pleased to report that our business continues to experience
strong momentum as we reported the highest quarterly revenue and net income
in the Company's history as we continue to penetrate the Chinese market
and reinvigorate consumer brand awareness for GLP products in the
women's health market," commented Tony Liu, Chairman and CEO of AOB. "We are
pleased with the performance of our most recent initiatives, which
include increased advertising and the expansion of our distribution
channels through the acquisition of HQPL, as AOB becomes a recognized brand
across China. We believe our orders for GLP products scheduled for
delivery in the fourth quarter will exceed our projection of $6 million
announced at the end of September."

Mr. Liu concluded, "Based on improving visibility and confidence in our
business we are going to begin providing quarterly revenue and earnings
per share guidance beginning with our fourth quarter 2006 results. At
this time we expect the fourth quarter revenue to be in the range of $37
million to $39 million with diluted earnings per share of at least
$0.15, which would represent approximately 88 percent to 98 percent revenue
growth from the comparable quarter last year with EPS increasing
approximately 67 percent versus last year."

This guy ainÂ't no dummy.   Liu holds an EMBA degree and is an
experienced entrepreneur. He was in the military for over 19 years and held a
high rank commander position when he was with the PeopleÂ's Liberation
Army. After Mr. Liu left the army, he started working for the government
of Heilongjiang province. Mr. Liu accumulated and possesses many years
of working experience while he witnessed and participated in the
massive macro economic changes in China. Mr. Liu was one of the
representatives to the National PeopleÂ's Congress. During the last thirteen years,
Mr. Liu has led and managed the Company as its Chief Executive Officer.
He has more than ten years of experience in managing pharmaceutical
companies. Mr. Liu was named the Outstanding Chinese Entrepreneur of the
World and he is currently the Vice Chairman of the International Chinese
Entrepreneur Association.
I guess if he eats his products, he wonÂ't have to go to the Â"looÂ" in
the middle of the night.  Ha ha ha.  I murder me!

Let me know what you think of this write up.  I always like to hear
from you, and frankly I don't even know if you read down this far or if
you even get my email, so drop me a line.

If you liked the write up, send it on to three friends.

If you really liked it, go to this website:

http://www.golittletigers.com .

These kids are working hard to make their football team something
special, and they need your help (I'm the acting President of its Booster
Club and I want to do a good job..this is REALLY important to me).

I am HUGE!!

$$$MR. MARKET$$$

http://www.mrmarketishuge.com

Drops 10% - the Mr. Market curse is alive & well

Mr. Market is proof that if you hold long enough, the stock will recover.

American Oriental Bioengineering 'Posts Very Encouraging Q3FY06 Results,' 'Buy/4' Rating Reiterated, Target Raised To $12, In 'Institutional' Research Update By Investrend Analyst Lytel
Wednesday January 3, 3:14 pm ET

NEW YORK--(BUSINESS WIRE)--(Investrend Research Syndicate) In a report dated November 30, 2006, American Oriental Bioengineering (AMEX: AOB - News) was as "Buy/4," with an increased target valuation of $12, beating analyst's expectations, reporting revenues of $27 million, net income of $7.6 million and EPS of $0.12 in an "Institutional" Update by Investrend analyst Kipley J. Lytel, CFA.

The full report, including important disclosures and disclaimers, is available at http://www.investrendresearch.com. In the report, the analyst also stated:

"The robust revenue growth stems both from acquisitions and from organic growth. AOB has been aggressively promoting its products, employing a Chinese celebrity for its advertising campaign, while acquisitions have helped expand the distribution network and product portfolio. The company reported that backlog for GLP's Jinji Series of products for Q4FY06 stood at $6 million.

"Two of AOB's products have been included in Chinese government's International Traditional Chinese Medicine Program for Cooperation in Science and Technology, which should provide the company with additional visibility factor and possibly will provide the company access to some government facilities or support. Also, the company has hired a new director, Lawrence S. Wizel, who has several decades of experience in Deloitte & Touche. Finally, AOB is moving its corporate headquarters, a move which in the long run may help the company better expand its business and control costs.

"As a result of the stellar growth and improved outlook, we have updated our valuation and price target, which has been increased to $12, representing gain potential of approximately 20%."

All Investrend Research reports published for AOB, including important disclosures and disclaimers, are also available via the company's InvestorPower(TM) Page, posted at Investrend.com (http://www.investrend.com). InvestorPower(TM) Pages are directly accessible from http://www.investrend.com/company/list.asp?sPathParam=yes. Investors are advised to read those disclosures carefully before trading in the equities of any enrolled company.

AOB is enrolled in Investrend Research's pioneering professional research program, which facilitates independent analysts to provide coverage for shareholders in companies that otherwise would have little or no analyst following.

Enrollment fees for Institutional coverage were $36,890, and the fees have been paid by the company. Analysts are paid in advance of initial reports by Investrend Research to eliminate pecuniary interest, and neither the analyst nor anyone associated with Investrend Research may own or trade in the stocks of a company under coverage.

soon MACD crossing should give AOB some more positive momentum

There is an article about AOB in tomorrow's Investor's Business Daily in the Health & Medicine Section:

----

American Oriental Bioengineering Shenzhen, China
bioaobo.com

If you've ever read an instruction manual for a Chinese company's product, you know the English can be imprecise. Even a company's namecan get lost in translation. Take American Oriental Bioengineering AOB. The Chinese maker of herbal traditional medicines doesn't do bioengineering, says Wilfred Chow, vice president of finance. The term bioengineering was simply an a name recommended to the firm when it sought its first stock market listing in the U.S. in 2002.

Translated into Chinese, 'bioengineering' would be more like health technology, Chow said. Though American Oriental has yet to start selling in the U.S., the company has embraced the American free-market system. Since 2002 American Oriental has migrated from an OTC stock to the Amex to the New York Stock Exchange, where it began trading on Dec. 18. Since its Amex debut in August 2005, the stock has gone from less than 2 to more than 12.
The listing on the NYSE gave the company a prestige factor, Chow said. While U.S. markets have stricter regulation than those in China, the U.S. rules are at least clear. In China, regulations mean what politicians and bureaucrats say they mean. American Oriental's culture emphasizes hard work, says analyst Julie Chen of Brean Murray, Carret & Co. Plants run 24 hours a day. Chen expects staffers to work right through Chinese New Year on Feb. 17, the biggest annual holiday. Much of the drive comes from Chief Executive Tony Liu, leader of the management team that took the company out of government hands in 1994. Liu, a former Chinese combat officer, maintains military discipline.

In China you need to run a company like an army to succeed, Chow said.

THE FINANCIALS
American Oriental Bioengineering has boosted annual earnings every year since 2002. Analyst Chen expects the company to post 2006 profit of 45 cents a share, up from 31 cents a year earlier. She sees 2007 earnings reaching 58 cents. When Chen initiated coverage in October she had a target price of $9. In December she raised that to $16.

THE COMPANY
American Oriental produces pharmaceutical products and dietary supplements based on plants. It targets the rural Chinese market. The company was founded in 1970 by the Chinese government as Three Happiness Bioengineering. It does almost no research and development, leaving that work to hospitals and universities. American Oriental buys technology and commercializes it. The fragmentation of the Chinese market gives the firm its growth opportunities, Chen says, and its modern business methods give it an edge over competitors. Unable to keep up, competitors are willing to sell out to American Oriental. More acquisitions are likely.

LOOKING AHEAD
The company plans to start selling its products in the U.S. in 2007. It plans to go global thereafter. Asian countries are likely to accept Chinese traditional remedies readily, Chow says. American Oriental is looking for partners in the U.S. and abroad to distribute the products.

Peter Benesh

Oliver, how long have you been holding AOB?  You must be very happy with it, I'm sure of that.  I didn't even realise they moved to the NYSE!!

Chart is just a thing of beauty, and I can't believe you have been giving us excellent and timely updates on it the whole time, and yet it hasn't garnered the attention it deserves!!  I can't believe I have had AOB on my monitor for the last 6 months and have just let it pass me by!!!

Anyway, AOB shows no sign of stopping, and I may look at picking some up near the ascending support line this week if possible.  Do you know when they are expected to report?

Cheers, and good trading to ya!
ST

AOB update:

Dig into American Oriental Bioengineering
Thursday February 22, 3:42 am ET

Prashanth Cherukuri submits: American Oriental Bioengineering, Inc. (NYSE: AOB - News) engages in the development and production of plant-based pharmaceutical [PBP] products and plant-based nutraceutical [PBN] products in China. Its PBP products include cease enuresis soft gel, which is used to alleviate bed-wetting and urination disorder; double ginseng yishen grain that is used for neurosis, vegetative nerve functional disturbance, and hypo-immunity; root of red-rooted salvia tablet that improves blood circulation and blood flow to the coronary artery to relieve pain, and is used for coronary ischemia and angina pectoris caused by coronary heart disease; and urinstopper patch, which is used to avoid frequent urination, urinal incontinence, and bed wetting.

The company's PBN products include protein peptide products series, which offers soypeptide tablets, milk powder, and coffee; compound bio-functional beverage series derived from honey products, marine plants, and natural herbs; vitamate oral liquid that strengthens the immune system and regulate blood lipids; and urinstopper capsule, which is used as a health supplement for children suffering from bed wetting and for middle-aged and elderly adults suffering from urinary incontinence.

American Oriental Bioengineering sells its products directly to retail stores, pharmacies, and hospitals, and to independent distributors. The company is headquartered in Harbin, China.

The Scoop: The company declared on February 14th that it will be announcing its quarterly earnings on March 12th, 2007. Analysts are expecting $106-108 million in revenues and $28 to $29 million net for 2006. Institutions will take note and start scooping up this now big board stock. Until growth slows, this is a long term winner - even Cramer is warming up to it after relentlessly bashing it from $5. The recent selloff attributed to the Chinese Government investigation into drug companies - i.e. that AOB's drugs are grandfathered - is unfounded!

I would keep this in my watchlist and notice it closely until a week before earnings, and buy on any dips from here on. Be careful though, as this is a Chinese small-cap stock and you have to you have to be ready for some volatility.

http://biz.yahoo.com/seekingalpha/070222/27731_id.html?.v=1

nice news, chart looks positive again, of course I didn´t bought  :-[

American Oriental Bioengineering Reports Fourth Quarter and Full Year 2006 Financial Results
Monday March 12, 4:02 pm ET

- Revenue Increased 108.7% to $41.3 Million in 4Q06 and 101.3% to $110.2 Million in FY06 -
- 4Q06 Net Income Increased 161.1% to $10.9 Million, or $0.17 per Diluted Share -
- FY06 Net Income Increased 117.5% to $29.2 Million, or $0.46 per Diluted Share -
- Company Provides Financial Outlook for 1Q07 and FY07 -

NEW YORK, March 12 /PRNewswire-FirstCall/ -- American Oriental Bioengineering, Inc. (NYSE: AOB - News), a leading manufacturer and distributor of plant-based pharmaceutical and nutraceutical products, today announced financial results for the fourth quarter and fiscal year ended December 31, 2006. Revenue for the fourth quarter of 2006 increased 108.7% to $41.3 million from $19.8 million in the fourth quarter of 2005. Revenue growth reflects continued demand for the Company's leading PBP and PBN products, as well as a $12.7 million contribution from the GLP acquisition. Revenue from PBP products increased 159.2% to $31.5 million from $12.1 million in the prior year's fourth quarter, driven by increased demand for Shuanghuanglian Injection Powder, Cease Enuresis Soft Gel and UrinStopper Patch. Revenue from PBN products increased 28.4% to $9.8 million from $7.6 million from the fourth quarter of 2005, due to increased demand for the Company's Protein Peptide products. Gross profit in the fourth quarter of 2006 increased 116.0% to $27.2 million from $12.6 million in the fourth quarter of 2005. Gross margin increased 220 basis points to 65.9% from 63.7% in the prior year's period. The increase in gross profit was a result of higher sales, improved gross margins and operating efficiencies across PBP and PBN businesses. Operating expenses in the fourth quarter increased 112.6% to $13.6 million compared to $6.4 million in the prior year period. This increase was primarily due to increased marketing materials, payroll and shipping expenses commensurate with sales growth. Additionally, the Company continued to increase advertising expenditure as it invests in brand strength, particularly related to products acquired with the GLP business. Operating income for the fourth quarter increased 119.6% to $13.6 million from $6.2 million in the fourth quarter of 2005. Operating margin as a percent of sales in the fourth quarter increased 170 basis points to 33.1% compared to 31.4% in the prior year period.

Net Income for the fourth quarter of 2006 increased 161.1% to $10.9 million, or $0.17 per diluted share, compared to $4.2 million, or $0.10 per diluted share, in the prior year's period.

Fiscal 2006 Financial Results

Revenue for fiscal 2006 surpassed $100 million in sales, increasing 101.3% to $110.2 million from $54.7 million in 2005. Net Income for 2006 increased 117.5% to $29.2 million, or $0.46 per diluted share, compared to $13.4 million, or $0.31 per diluted share, in the prior year.

Mr. Tony Liu, Chairman and Chief Executive Officer of American Oriental Bioengineering commented, "We are pleased to report another strong quarterly and fiscal year performance. Revenue exceeded $41 million in the fourth quarter and exceeded $110 million for the year reflecting continued strong growth in both PBP and PBN product categories. In 2006 we focused on a number of core strategic initiatives including improving the breadth and quality of our product portfolio, penetrating new markets and rationalizing our administrative, manufacturing and distribution cost structures. We achieved success in these areas through accretive acquisitions and through a program of continuous internal efficiency improvements."

Fiscal 2007 Financial Update

For the first quarter of fiscal 2007, the company anticipates revenue to be in the range of $24 to $25 million and anticipates diluted earnings per share of approximately $0.10. This is based on a diluted share count of approximately 66.5 million shares outstanding. For the 2007 fiscal year, the Company anticipates revenue to be in the range of $143-$147 million. This guidance does not account for any potential acquisitions in 2007.

Mr. Liu concluded, "Moving into 2007, we intend to continue to market our leading brands, develop new products and line extensions, further expand our channels of distribution, identify further cost savings throughout our business and pursue acquisitions that will be complimentary to our current business. We are committed to remaining a leader and innovator in the area of women's health and believe our initiatives in 2007 will continue to enhance our performance and expand our presence in the marketplace. We are energized with our opportunities and will continue to work aggressively to maximize return for our shareholders."

American Oriental Bioengineering "buy"

Thursday, March 08, 2007 10:06:05 AM ET
Brean Murray, Carret & Co

NEW YORK, March 8 (newratings.com) - Analyst Julie Chen of Brean Murray reiterates her "buy" rating on American Oriental Bioengineering (ticker: AOB). The target price is set to $16.

In a research note published this morning, the analyst mentions that the company is likely to report its 4Q06 revenues and EPS in-line with the estimates. Any mandate or regulation passed by the Chinese government that is unfavourable for the Chinese stock market is expected to have a limited impact on American Oriental Bioengineering, since the company is not listed on the Chinese stock exchange. The company would also not be impacted by any decline in the Chinese economy, Brean Murray adds.

&
Brean Murray note this morning
   
Brean reiterates buy and $16 target....top pick in their 2007 China small cap universe. Raised 2007 estimates too $148.4 million from $144.7 million. "We view any weakness in the stock as a buying opportunity. We believe the company's full year revenue guidance of $143-$147 million is conservative, based on our conversations with management after the call. We understand management included only minimal upside rom a nationwide Yi Mu Cao rollout....We are anticipating at least one acquisition in 2007.

what a bargain!
I have bought AOB @ 9$

Unbelievable.....$8.60  now....

Shucks missed this on the short side.

Why the big drop, what am I missing?  ::)

I'm in @ $9 this morning too.  Not sure exactly how their earnings killed the stock so badly, but I guess it was due to a clear forecast of slowing growth into 07.  

Anyway, technically I should have taken a closer look at the chart before putting my buy in - I thought just below $9 would be support, but AOB wanted to fill the open gap and has just done so.  Today's low so far was 8.52.  The November gap opened at 8.55.  So that is where support stands.  As far as resistance, 9.00 and then 9.35, the low of the day after the november gap, looks to be significant in th short term.  I think AOB will also encounter reasonable resistance at 9.65, again from November and from the low after the China crash at the beginning of March.  I'd like too see it test that level today, but if it doesn't, I'm sure we'll see a test there in the next few days.

I'm gonna have to put my stop just below 8.50, as if we break there, it would signal to me that AOB wants to keep going down.  We've all; seen to many great stocks with great charts that get broken by this kind of event.  Despite their numbers, AOB could be one of them.

Quote from: Se7en on March 13, 2007, 12:14:36 PM
Why the big drop, what am I missing?  ::)

Hmmm.... With the benefit of hindsight let me give my two cents ::)

I love AOB as a company but as an investment I am a bit more skeptical at this level.

As David has pointed out many times Chinese companies are trading at a discount. From my point of view they should trade at a premium due to the growth in the Chinese economy but the market probably know better  ;)

AOB's trailing PE is around 18.5, which doesn't appear to be cheap. I do not have any statistics to verify this but those Chinese stocks that are on my watch list is trading at PE levels significantly lower. (I am looking at stocks like XING, ACH, BBC etc.)

So a PE premium can only be justified if you expect earnings to grow above (Chinese) average and the valuation of AOB seems a bit rich with a forecast of Q1 07 EPS of 0.1 and a 30% top line growth for 07.

When all that is said I think AOB will be a great investment. This company has a great track record but you might be able to buy it cheaper than what is on offer today.

I bit at 8.63, or should I say I got bit at 8.63.   ???  We shall see.

AOB made a nice recovery after the big gap down, but got banged on the head at $10.  After a few days of fairly weak choppy trade, AOB made a clear break on the downside today, taking out my 9.46 stop for a 5.8% gain on the remainder of my shares.  It closed below 9.36 support (the open after the gap down), with MACD and RSI both looking weak.  Not sure, but it looks like this could signal a move back to test the 8.50 level again.

fyi:
American Oriental Bioengineering Reports First Quarter 2007 Financial Results
Monday May 7, 4:01 pm ET
- Revenues Increased 34.8% to $25.7 Million in 1Q07
- 1Q07 Net Income Increased 31.1% to $6.4 Million, or $0.10 per Diluted Share
- Company Provides Financial Outlook for 2Q07 & FY07

NEW YORK, May 7 /PRNewswire-FirstCall/ -- American Oriental Bioengineering, Inc. (NYSE: AOB - News), a leading manufacturer and distributor of plant-based pharmaceutical and nutraceutical products, today announced financial results for the first quarter of 2007.
Revenues for the first quarter of 2007 increased 34.8% to $25.7 million from $19.1 million in the first quarter of 2006. This increase reflects $6.4 million in revenue from the Company's Jinji product portfolio, as well as year over year growth in the Company's core PBP and PBN products. Revenue from PBP products increased 52.4% to $18.6 million from $12.2 million in the prior year's first quarter, driven primarily by the Jinji products series, including the Company's newly launched Yi Mu Cao product for the relief of pre-menstrual symptoms, and by the Cease Enuresis Patch. Revenue from PBN products increased 3.7% to $7.2 million from $6.9 million from the first quarter of 2006, due to increased demand for the Company's soy peptide products. Gross profit in the first quarter of 2007 increased 44.1% to $17.7 million from $12.3 million in the first quarter of 2006. Gross profit margin increased 440 basis points to a record 68.8% from 64.4% in the prior year's period. The increase in gross profit was a result of increased sales of PBP products, which carry higher margins and improved operating efficiencies across both business segments.

Operating expenses in the first quarter increased 65.8% to $9.8 million compared to $5.9 million in the prior year period. This increase was a result of additional expenses related to GLP that was not associated with the company in the prior year period, as well as increased marketing and advertising expenses related to the Company's efforts to increase market awareness of its brands and products. Operating income for the first quarter increased 24.0% to $7.9 million from $6.4 million in the first quarter of 2006. Operating profit as a percent of sales in the first quarter decreased 260 basis points to 30.8% compared to 33.4% in the prior year period.

Net Income for the first quarter of 2007 increased 31.1% to $6.4 million, or $0.10 per diluted share, compared to $4.9 million, or $0.08 per diluted share, in the prior year period.

Mr. Tony Liu, Chairman and Chief Executive Officer of American Oriental Bioengineering commented, "We are pleased to report another quarter of continued growth in our business. Our major plant-based pharmaceutical and nutraceutical categories contributed to our revenue growth in the first quarter with the biggest contribution coming from our over the counter (OTC) products. Our newly launched Jinji Yi Mu Cau product contributed to our results in the quarter and we are satisfied with the momentum of this product as we move into the second quarter. We continued to effectively manage our operating costs and sourcing efficiencies and were pleased to see stable pricing for our leading products, all of which resulted in record gross margin."

Fiscal 2007 Financial Update

For the second quarter of fiscal 2007, the Company anticipates revenue of approximately $33.0 million, a 45% increase compared to second quarter 2006 revenues of $22.8 million, with the majority of this revenue growth coming from products that serve the OTC market, primarily the Jinji product portfolio. The Company anticipates diluted earnings per share of approximately $0.14, based on a diluted share count of approximately 66.6 million shares outstanding.

For the 2007 fiscal year, the Company anticipates revenues to increase at least 32% from the prior year to at least $146.0 million. This guidance does not account for any potential acquisitions in 2007.

Mr. Liu concluded, "We continue to focus on opportunities that will further enhance the presence of our leading product brands and strengthen the total number of plant-based healthcare products in our portfolio. Consumer awareness of our brands continues to grow through our marketing efforts and the ongoing expansion of our diverse channels of distribution.

We also remain highly focused on the introduction of new products through the pursuit of complimentary acquisitions and additional product line extensions. We believe that these initiatives will better position our company for future growth and will further establish AOBO as a leading integrator and cultivator of plant-based traditional Chinese medicine products."

Are you holding la-onda?

I'm considering buying.  This is a beautiful setup, especially fundamentally and technically(weekly).

If they meet the revenue # of 146 mil they projected for fy 07, I imagine earnings could be a pretty beautiful thing.  I feel like AOB could consolidate for 3-6 months I guess, but a run at the high in the 14 ish area is inevitable. 

Target in the high teens by the end of 07, provided fundamentals keep up on track.

AOB update:
1.
American Oriental initiation details (AOB) 9.73 +0.34 : As mentioned at 8:28, Lazard initiated AOB with a Buy and $13 tgt. Firm believes AOB has executed exceptionally well over the past three years, integrating four rapidly accretive acquisitions and delivering material topand bottom-line growth. Firm forecasts organic EPS growth of 31% in 2007 and 17% in 2008. These forecasts exclude potential upside from Xinan, which AOB intends to acquire. Firm believes AOB is poised to generate superior top- and bottom-line growth.
2.
AOB: US Bancorp Starts @ Outperform; Sets Tgt @ $14
Monday , July 09, 2007 07:58ET
Issuer: American Oriental Bioengineering Inc (NYSE: AOB)
Analyst Firm:  U.S. Bancorp Piper Jaffray
Ratings Action: INITIATE
Current Rating: Outperform
Target Price Action: INITIATE
Target Price: $14.00
3.
Chart:

AMERICAN ORIENTAL BIOENGR INC COM (NYSE: AOB)
Threads in Previous 3SOF Picks Board, have been merged.

All future earnings look to be increasing also, plus it is now above both the 13 and 50 day moving averages!
13-day MA has crossed over the 50-day MA

52wk Range: 5.03 - 14.19
Volume: 683,900
Avg Vol (3m): 1,677,420
Market Cap: 681.37M
P/E (ttm): 17.23
EPS (ttm): 0.53

Technicals
Last Price Quote is:
5.06%above 13-day MA
4.32%above 50-day MA
RS Rating: 15 

Fundamentals
Key Data:
Market Cap (M): $681.38 
P/E Ratio: 17.30 
PEG Ratio: 0.275926 
Next Earnings: 11/13/2007
Last Analyst Rating: Sector Outperform

I will leave you with Friday's closing while I'm in this thread.

2)AOB: Short Interest UP 4.0% to 12.2M in Aug 2007
Wednesday, August 22, 2007 10:45ET

According to new short interest data from NYSE, short interest for American Oriental Bioengineering Inc (NYSE: AOB) INCREASED 4.0% to 12,175,990 shares for the month ended mid-August, 2007.

SYMBOL      JULY          AUGUST          CHANGE       %CHANGE     DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
AOB           11,710,467      12,175,990        +465,523        +3.98%           6

Based on AOB's 20-day average daily share volume of 2,033,885, it would require approximately 6 day(s) of buying to cover this short interest.

&

AOB: Westminster Keeps @ Strong Buy; Keeps Tgt @ $13.8; Analyst Notes
Tuesday , August 21, 2007 16:13ET

Issuer: American Oriental Bioengineering Inc (NYSE: AOB)
Analyst Firm:  Westminster Securities
Ratings Action: REITERATION
Current Rating: Strong Buy
Target Price Action: MAINTAIN
Target Price: $13.80
Analyst Comments: The firm's Strong Buy rating is based on their expectation the company's share price will experience significant appreciation as revenue and net income growth from existing and newly-acquired operations become more visible.

August 23 Analyst Julie Chen of Brean Murray reiterates his "buy" rating on American Oriental Bioengineering (ticker: AOB). The target price is set to $16.

In a research note published this morning, the analyst mentions that acquisitions are integral to the company's key growth strategy. The sophistication and competence of American Oriental Bioengineering's management, as demonstrated in China, are the primary drivers of the company's success, the analyst says. There are no risks involved in the closing of the Changchun Xinan Pharmaceutical acquisition, Brean Murray believes.

inverted head & shoulder chart pattern ???