Small cap power: CIMT

[terainvestment]

no trading volume on CIMT today...good or bad sign?

[tokyopua]

no trading volume on CIMT today...good or bad sign?

Neutral sign, just the way this stock trades sometimes.  David has mentioned there could be days where no shares are traded, but it won't make a difference to the long term performance of the stock.

[David Randolph]

no trading volume on CIMT today...good or bad sign?

No sign. There was a small gap opened between $2.3 and $2.35. I guess that gap will be closed today, as the stock recovers from the lower open. But we need to focus on long term fundamentals if we want to strengthen our hands.

Unfortunately we don't get any clues of the future from what a stock does in any given day.

Thanks for your comment terainvestment

[David Randolph]

no trading volume on CIMT today...good or bad sign?

Neutral sign, just the way this stock trades sometimes.  David has mentioned there could be days where no shares are traded, but it won't make a difference to the long term performance of the stock.

Thanks Tokyo, that's exactly it.

The stock recovered a bit of ground after that 6% fall at the open, closing at $2.33. No news out today. I'll keep holding CIMT, as the stock goes through this bottoming process.

[David Randolph]

CIMT's volume is drying. It's better that way. There's no catalyst to move it decisively higher at this moment, and volume probably would mean just panic selling. I prefer a rounding bottom, with low volume at the center and expanding volume at the right wing of the technical formation.

Anyway, CIMT is a software company selling below on year revenues. The company just delivered two profitable quarters and announced an accretive acquisition. Also, it developed a software product that doubles its market potential, the progressive die design tool.

I'll keep holding CIMT.

[yukiii]

Does anyone know when they consolidate Microsystem Srl in the 3rd quarter, will this be positive or negative  to the bottom line. I know they had 10mil in rev but do they have any debt CIMT is taking on.
Are they earning Money?

[David Randolph]

Does anyone know when they consolidate Microsystem Srl in the 3rd quarter, will this be positive or negative  to the bottom line. I know they had 10mil in rev but do they have any debt CIMT is taking on.
Are they earning Money?

Yes, Microsystem was profitable in 2006 and the CEO said he expects the company to remain profitable, and therefore contribute positively to CIMT's earnings starting in Q3 2007. The only problem is that probably Microstrategy is a low margin business. Check the conference call:

http://www.cimatron.com/Main/download.aspx?FolderID=2744&lang=en

[yukiii]

Does anyone know when they consolidate Microsystem Srl in the 3rd quarter, will this be positive or negative  to the bottom line. I know they had 10mil in rev but do they have any debt CIMT is taking on.
Are they earning Money?

Yes, Microsystem was profitable in 2006 and the CEO said he expects the company to remain profitable, and therefore contribute positively to CIMT's earnings starting in Q3 2007. The only problem is that probably Microstrategy is a low margin business. Check the conference call:

http://www.cimatron.com/Main/download.aspx?FolderID=2744&lang=en

Was just profitable 2006..... and should be profitable 2007
CIMT will take on all Microsystems DEBT and EXpenses. I am getting a bad feeling next quarter will be no so good. Oh well just watching this....
I noticed most of the companies in your portfolio are (2)Chinese, (1)Taiwan, (1)Bermuda or( 3)Israel (5) US ( 1) Canada
I think you have to many from Israel you never know what they will report. I remember SILC one time was suppose to have like .10 for the quarter and came out with a minus .35.

Small Chinese stocks never get full value. Just something to think about......

[David Randolph]

CIMT will take on all Microsystems DEBT and EXpenses.

What CIMT is buying a company and getting its debt and expenses? I thought they would get just its assets and profits

[Se7en]

David, can we find somewhere more info about Microsystems, we know they are profitable but it would be nice to have all the numbers or is that not possible?!

Btw, did you get an answer to your email from a few weeks ago?

[terainvestment]

I am italian and MicroSystem S.r.l. is an italian private company.
Here in Italy you can read all the P&L statement, balance sheets, cash-flows etc.
You can read and know everything here, even if the company is private (despite US where is not possible).

What you need is buying the info from Dub &Bradstreet: www.dnb.com

Hope this helps,

Andrea

[Se7en]

Thx for the info terainvestment, I think I'm gonna skip on it because the reports are very expensive! 

[terainvestment]

Well, I have written an e/m to MicroSystem asking the balance sheets.
If they send it to me (they should), i will share the info with you guys.

Cheers from sunny Milan,

Andrea

[ygtrdr]

Thank you Andrea. Applaud for your initiative.

[David Randolph]

Well, I have written an e/m to MicroSystem asking the balance sheets.
If they send it to me (they should), i will share the info with you guys.

Cheers from sunny Milan,

Andrea

Thanks a lot for your help Andrea

I hope you're a fan of Figo and Rui Costa

Anyway, the 2006 balance sheet and income statement from Microstrategy would be great information ... if they were to send them to you ... hmmm, but wait a minute, probably because Microstrategy is being acquired by CIMT, which is a publicly traded company, they won't share the numbers. The Dun & Bradstreet database would be great, but it isn't economically viable to buy the whole database to know about just one company.

But let me applaud you for the initiative

CIMT started well in the morning, but fizzled by the end of the session. The 200 days SMA is getting closer now, at $2. Believe me, I've seen many charts where something like this happens, a big bull run, then a pullback all the way down to the 200 days moving average and then the real thing! If my fundamental perspective is correct, this whole up and down movement will be almost imperceptible three years from now.

Check this example:





Well, maybe not the best example ... I'll look for more dramatic ones for the next updates.

What I meant to show with this example was that CIMT's ups and downs over the medium term chart don't tell us much about the future.

Looking at the fundamentals, do I see any dilution? No, it never happened in 8 years of history since the company is publicly traded. Do I see revenues rising 20% a year going forward? Sure, Microstrategy's acquisition will make, by itself, revenues grow by roughly 50%. The new die design application also doubles the market reach of CIMT. And what about net profit margin, is it possible to be 15%? I don't see why not, the company sells software at a very high price. The software was already developed. Each new copy costs less than a dollar. Can CIMT trade at 35 times earnings in the future? Yes it can, because on average, companies that belong to the same industry group, the technical software systems, trade at 35 times earnings.

So, can CIMT rise 500% or more over the next three years? Yes it can. It wouldn't be the first, or the last stock to do it.

I'll keep holding CIMT with strong hands.