Session of 03/28/2007

[BigSully1]

MED closed off it's high of day, but still closed in the upper half of it's range, with a very respectable 4.43% gain through todays market turmoil, on increasing volume again. What do you guys think?

[ygtrdr]

Thanks for that link buddjas.

[buddjas1]

http://biz.yahoo.com/iw/070328/0232262.html

RNO, gonna be a great day.  Glad I had the guts to hold through earnings.  (Thanks David!)

Rio Narcea Reports Record Year-End 2006 Results-Net Income of $70.7 Million, Up $112.9 Million Over 2005

$0.29 for Q406 vs. ($0.08) for Q405

Extrapolated, RNO is perhaps a 5-bagger.  $0.29 * 4 * (avg. PE 20) = $23.2

Now trading at $4.01.   23.2/4.01 = 5.78

Recent earnings do not include the crazy increase in nickel prices over last couple months.  RNO is 60% nickel.

[kslifka]

http://biz.yahoo.com/iw/070328/0232262.html

RNO, gonna be a great day.  Glad I had the guts to hold through earnings.  (Thanks David!)

Rio Narcea Reports Record Year-End 2006 Results-Net Income of $70.7 Million, Up $112.9 Million Over 2005

$0.29 for Q406 vs. ($0.08) for Q405

Extrapolated, RNO is perhaps a 5-bagger.  $0.29 * 4 * (avg. PE 20) = $23.2

Now trading at $4.01.   23.2/4.01 = 5.78

Recent earnings do not include the crazy increase in nickel prices over last couple months.  RNO is 60% nickel.

I owned RNO a while back and sold at 3.60.

I bought RNO back after the earnings report.... which ooks great

[Dracull]

Regarding COGN, for those that don't know, their business is software applications for finance, in the line of Peoplesoft, the company that was recently bought by Oracle.

There are rumours of being bought by Oracle, IBM or SAP.

The business is growing very fast, and they have the advantage of their software can be implemented at any ERP. Now image, for every ERP client, there is a potential client of a Business Intelligent (BI) application...and COGN is one of the best at the field.

Let's see

[ravenquork]

Re IEAM:  Another hugh insider buy just a couple of minutes ago.

http://www.sec.gov/Archives/edgar/data/1059677/000116694407000002/xslF345X02/primary_doc.xml

IEAM's about to blow up.

I do believe you are correct!
- Large institutional and insider buying.
- Margins may double
- Sales look like 100 million fy06 reported June 07  up from 30 million. fy 08 is predicted to continue similiar strong growth.
- Management has streamlined operations, expanding into SE US
- focused on margin expansion
- will be announcing, within a few weeks, the details of a marketing agreement with a major oil co, which will increase sales about 25% at a margin higher than their historical margin. At the same time they will be discontinuing there low end, low margin product line.
- Management indicates revenue growth Q2 1.4 million Q3 2 million, Q4 may approach 4 million. - Management owns 24% of co
- CEO takes zero pay in cash, is betting everything on company growth. 
- Chart looks like a flat liner, but given the buying pressure, looks like this one could double in the next twelve months. 

If I get a chance I will try to put the numbers in a table format this evening or tomorrow morning. 

[BigSully1]

Re IEAM:  Another hugh insider buy just a couple of minutes ago.

http://www.sec.gov/Archives/edgar/data/1059677/000116694407000002/xslF345X02/primary_doc.xml

IEAM's about to blow up.

I do believe you are correct!
- Large institutional and insider buying.
- Margins may double
- Sales look like 100 million fy06 reported June 07  up from 30 million. fy 08 is predicted to continue similiar strong growth.
- Management has streamlined operations, expanding into SE US
- focused on margin expansion
- will be announcing, within a few weeks, the details of a marketing agreement with a major oil co, which will increase sales about 25% at a margin higher than their historical margin. At the same time they will be discontinuing there low end, low margin product line.
- Management indicates revenue growth Q2 1.4 million Q3 2 million, Q4 may approach 4 million. - Management owns 24% of co
- CEO takes zero pay in cash, is betting everything on company growth. 
- Chart looks like a flat liner, but given the buying pressure, looks like this one could double in the next twelve months. 

If I get a chance I will try to put the numbers in a table format this evening or tomorrow morning. 

You guys convinced me that IEAM is definitely worth a close look. It's got my vote in the poll.

[NERO]

how about LMRA,david?

[jos]

here is my humble attempt to RNO analysis

Summary:
Graph show bullish trend.
No dillution in past 3 year.
Company has blow out 2006 full year EPS and increasing Net margin.
Balance sheet is bit weak as current ratio < 2. But it is more than 1. Like to see > 2
Increasing Revenue and has maintaining Gross margin.
P/S is 1.41, while industry has 10. Undervalued stock.
I found that this stock shall produce 30% return for next 10 year.
Short term bullish. Good outlook. Cheap stock.

Attachment has more details.

[David Randolph]

Good morning, great analysis

Today's winner was IEAM.

[David Randolph]

IEAM.OB, as with many OTCBB traded stocks, is very tricky. In the CEO's words, their business is "buying mediocre businesses" and turning them into acceptable businesses. It is an holding company with several subsidiaries, with revenues and margins varying a lot between them.

The big drop in early December was due to auditors and the CFO resigning. It seems they resigned because of weak internal controls that still come as a big warning in the latest 10-Q, but nobody knows the real reasons. It would be important to find out.

On the plus side come the very appealing projections the CEO made at the B.Riley & Co. presentation, in early March, saying revenues will grow from $17 M in fiscal Q2 2007 (the October - December quarter), to $25 M in Q3 and then to $35 M in Q4:



EBITDA is expected to also grow a lot:



Another interesting issue is that management says their results have been impaired by non cash expenses due to convertible debentures being converted, but that will be gone in two quarters or so, and then the EBITDA number would almost all go down to the bottom line, which means fiscal Q4 2007 (the quarter ended in June 2007) would show about $7 M in net income. With about 15 million shares outstanding, this would mean EPS of about $0.47, in one quarter, as buddjas1 says. For a full year it would mean $1.87 EPS, and the stock closed yesterday at $6.11.

This seems just great, but I have doubts. I wasn't in the mood of buying an OTCBB traded stock, even less being a complex holding company where the CFO and Auditors recently resigned. Because insider purchases don't make me more confident, I've seen OTCBB companies do that trick too often. And they're not open market purchases, as buddjas1 noticed.

I couldn't make a video analysis on IEAM.OB, the numbers are not clean enough. But I believe there's enough material here and on other threads in 3 Stocks for the more risk tolerant traders/investors in this board to take action if they want.

I've been learning to be more risk averse and play safe. I'm not looking for spectacular short term gains on a small OTCBB stock, but for reliable and consistent profits year after year.

Therefore I'll pass this opportunity, good luck to the holders of the stock, I hope it shoots to the moon

[buddjas1]

The big drop in early December was due to auditors and the CFO resigning. It seems they resigned because of weak internal controls that still come as a big warning in the latest 10-Q, but nobody knows the real reasons. It would be important to find out.
I wasn't in the mood of buying an OTCBB traded stock, even less being a complex holding company where the CFO and Auditors recently resigned. Because insider purchases don't make me more confident, I've seen OTCBB companies do that trick too often. And they're not open market purchases, as buddjas1 noticed.

Thanks for your comments.  The CFO "resigned" and the auditors were replaced because IEAM was (is) having trouble filing the 10Qs on time.  If you listen to the last several conference calls, the president forshadowed the change, finding the company's inability to file 10Qs on time as unacceptable.  My calls into IR confirmed that.  I do not draw anything negative (only positive) from the changes. 

Regarding the non-open market purchases, the company has been clearing out outstanding warrants, both through purchases with company $$ (the buyback program) and with non-open market purchases of the warrants by individuals and institutions.  I applaud those efforts.

One more comment, the big drop in price started on Dec. 4, 2006.  http://finance.yahoo.com/q/hp?s=IEAM.OB&a=01&b=11&c=2005&d=02&e=29&f=2007&g=d

That was the day IEAM posted its 10Q, which was way late.  http://www.sec.gov/Archives/edgar/data/1059677/000135471706000102/0001354717-06-000102-index.htm
http://www.sec.gov/Archives/edgar/data/1059677/000135471706000094/nt10q.htm

As a result, the CFO was replaced, that same day.  http://biz.yahoo.com/pz/061204/109787.html

The results were not up to some shareholder's standards.  A major shareholder dumped all the shares in one day.  http://www.sec.gov/Archives/edgar/data/1059677/000091957406004919/d729219_13g-a.txt


The new auditor was not announced until Dec. 8, 2006.  http://biz.yahoo.com/pz/061208/110156.html

[David Randolph]

Thanks for your comments.  The CFO "resigned" and the auditors were replaced because IEAM was (is) having trouble filing the 10Qs on time.  If you listen to the last several conference calls, the president forshadowed the change, finding the company's inability to file 10Qs on time as unacceptable.  My calls into IR confirmed that.  I do not draw anything negative (only positive) from the changes.

Regarding the non-open market purchases, the company has been clearing out outstanding warrants, both through purchases with company $$ (the buyback program) and with non-open market purchases of the warrants by individuals and institutions.  I applaud those efforts.

Good points buddjas1

I don't know the company as well as you do. I'll keep studying it and maybe buy it a good $1 or $2 above the current price.

But the chart below is worrisome, they're already talking about 15 million shares outstanding. I've seen the "insider buying" and "buyback program" trick several times as a way to mask heavy dilution.

The balance sheet says IEAM has $1.7 M in cash, $13.1 M in receivables and $6.15 M in inventories. As current liabilities I see $5.67 M of current maturities of long term debt, $2.58 M of current maturities of long term debt related parties and $7.4 M of accounts payable. I see a serious short term liquidity problem here that doesn't combine well with a "buyback program".

I remain suspicious. But maybe I'm wrong. I hope I am. But risk is too high for my taste. Good luck