3SOF

1. OSCI

2.  reason:

A FDA approved drug--Factive;
A major partnership in the work;
Cheap.

3. Chat:  see yahoo by yourself

SVA has so many news that are not listed by yahoo.  If you are interested, please check this following link, it is a little bit slow though:

http://www.sinovac.com/NewsRoom/News/

I really like this pick by David and did not sell following David's steps.  I know nothing about technical, that is why David's insight is very helpful to me.

HOM is the kind of stock Warren Buffet would love.  Simple business, I understand.  Making great money, I like.  Great management, very important to me.  Good acquisation, low multiples, accretive to rev. and earnings immediately.

The news they issued today is just factastic: for the first half they ahd rev. of 25.4M and earning of 0.08/share.  The guidance they issued today for the full year would be rev. 75M and earning of 0.25/share.  This means for the 2nd half, they will be doing ~50M rev. and 0.17/share.  Wow!  What will be for next year?  Rev. at 100M and earning of 0.35/share should be the least.

All in all, this is a fundamentally very solid company, I plan to hold long term.  The fundamental of the company is why I did not sell yesterday or the day before.

While everybody is jumping up and down about the cc, I do have a few concerns to share:

1.  The outstanding shares could be as many as 233 millions!  If all excised, BRVO already would have a market cap of $154 million.  All considered, even if they realize the sales of $75-100M for next year, the company is not that cheap any more.  Let's say, its fair value is $300M or so for sales of $75M (4x), the most the stock could deliver is a double.

2.  The margin:  while gross margin will be slightly below 30%, the estimated net margin thrown out was like 8-10%.  For 75-100M sales, that means the profit for the company for next could be in the range of 6-10M, again that is not much for a company already command a market cap of 150M (15-25 p/e).

3.  Need of raising money to fund the expansion:  anybody who ran a real business knows that expansion does not happen over night and you need money to make money.  Raising more money means more dilution, right?

Please point out if my concerns are not valid.  Thanks,

BRVO will hold a teleconference call on this MDA agreement to discuss details next Tuesday.  We can all listen and ask questions during this.

The news release this morning is a little confusing about the warrants being issued to CCE.  So I called James Dryer to clarify things.  Here is what I got:

If CCE excise their warrants any time during the next three years, 30 million warrants will allow CCE to buy 30 million shares of BRVO stock at 0.36/share.  BRVO has 300 million shares authorized, but 110 million issued (outstanding).  

Because the 30 million shares will be from the company, not current share holders, 10.8 million cash will be going to the company too.  So 30 million shares will be 10% of the authorized 300 million shares, but ~21% of the issued shares if they excise today (if they excise today, the issued shares will be 140 million shares).  If they excise later, the percentage will vary depending on how many more shares are issued.

Hope this helps.