Last week was very profitable for Chinese-based stocks with small floats, sparked by a 10x move on Yulong Eco-Materials Limited (YECO) from $1.52 to a high of $17.87 on news of a completed acquisition that was first announced weeks ago. China Ceramics Co., Ltd. (CCCL) followed up with a 200% move on October 18 and The9 Limited (NCTY) with a 400% spike on the morning of October 19. Chinese stocks had a quiet down day on Monday thanks to a larger market pullback but we think there are two other small float stocks that are prime for a sudden spike like these three. They are China Recycling Energy Corporation (CREG) and Delta Technology Holdings Limited (DELT). We are up to 719 followers despite not giving out a lot of alerts, a fact that we think is indicative of a successful, diligent and prudent stock picking history. If you like our picks you can follow our blog by clicking the follow button on the top of the left hand panel. You can also follow us on Twitter @StockTradePicks. We have over 3,000 followers on Twitter as well.
This is a follow up to our alert from yesterday. These stocks were all green on Tuesday with CCCL increasing 16%, YECO 18%, NCTY 17% and our picks CREG 6% and DELT 9%. This bodes well for all of these stocks but we think CREG and DELT could be morning gappers like the rest have been on any given day.
What makes CREG and DELT such good candidates for the spikes we have seen on these other three stocks? Two reasons. First, they offer equivalent or better small floats from which squeezes can occur. Second, they are fundamentally undervalued based on the assets held on the balance sheet.
Let's review finviz data for CREG:
CREG has a book value per share of $24.12 and cash per share of $7.81, both substantially higher than its stock price of $1.30. This stock would need to spike 5-10x just to come in line with its book value. The share float is only 5.56 million on outstanding shares of only 8.36 million. Finviz doesn't recognize any revenue for CREG, but that is actually not true. It has a sales lease business model in which it records all of its income as interest income:
Most quarters it is profitable but it had a rough Q2. Still, it does not justify such a discount in our opinion. We think CREG is a prime target to go to $5 to $10 based on the small float and strong fundamentals.
Let's review finviz data for DELT:
DELT only has $0.02 per share in cash but $3.97 in book value per share, four times higher than its $0.98 stock price. Insiders own nearly half of the shares so its float is only 6.8 million on total shares outstanding of 12.29 million. DELT is another prime spike candidate based on float and fundamentals, though maybe not as extreme as CREG, something like $2 to $3.
An investor might say though, "Wait, all of these Chinese stocks trade at a fraction of their book value, and they never go up". This is not true at all.
Let's review finviz data for YECO:
YECO has a book value per share of $1.54. It was actually trading at its book value prior to its big run last week and obviously trades much higher than its book value now. Insiders own the majority of shares so that it has a float of 1.09 million on 4.56 million total shares, which may account for its extreme spike. But we see other examples that this is not always the case.
Let's review finviz data for NCTY:
NCTY actually has negative shareholder's equity, so there goes the theory that Chinese stocks trade at well below their book value. The float is 10.41 million shares on 24.42 shares outstanding, far higher than CREG or DELT.
YECO, NCTY and CCCL all spiked well over 100% on flimsy, old or non-existent news. With Chinese stocks back in play, CREG and DELT are prime candidates to spike 100% or more out of nowhere like these stocks. We think it can happen sooner rather than later. All three of the aforementioned stocks will have attracted shorts thanks to their high volume and volatility. They can move back up on a short squeeze at any time, bringing the entire industry up and pouring gasoline onto any rise of these two undervalued, low float plays.
Disclosure: We are long CREG and DELT
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This is a follow up to our alert from yesterday. These stocks were all green on Tuesday with CCCL increasing 16%, YECO 18%, NCTY 17% and our picks CREG 6% and DELT 9%. This bodes well for all of these stocks but we think CREG and DELT could be morning gappers like the rest have been on any given day.
What makes CREG and DELT such good candidates for the spikes we have seen on these other three stocks? Two reasons. First, they offer equivalent or better small floats from which squeezes can occur. Second, they are fundamentally undervalued based on the assets held on the balance sheet.
Let's review finviz data for CREG:
CREG has a book value per share of $24.12 and cash per share of $7.81, both substantially higher than its stock price of $1.30. This stock would need to spike 5-10x just to come in line with its book value. The share float is only 5.56 million on outstanding shares of only 8.36 million. Finviz doesn't recognize any revenue for CREG, but that is actually not true. It has a sales lease business model in which it records all of its income as interest income:
Most quarters it is profitable but it had a rough Q2. Still, it does not justify such a discount in our opinion. We think CREG is a prime target to go to $5 to $10 based on the small float and strong fundamentals.
Let's review finviz data for DELT:
DELT only has $0.02 per share in cash but $3.97 in book value per share, four times higher than its $0.98 stock price. Insiders own nearly half of the shares so its float is only 6.8 million on total shares outstanding of 12.29 million. DELT is another prime spike candidate based on float and fundamentals, though maybe not as extreme as CREG, something like $2 to $3.
An investor might say though, "Wait, all of these Chinese stocks trade at a fraction of their book value, and they never go up". This is not true at all.
Let's review finviz data for YECO:
YECO has a book value per share of $1.54. It was actually trading at its book value prior to its big run last week and obviously trades much higher than its book value now. Insiders own the majority of shares so that it has a float of 1.09 million on 4.56 million total shares, which may account for its extreme spike. But we see other examples that this is not always the case.
Let's review finviz data for NCTY:
NCTY actually has negative shareholder's equity, so there goes the theory that Chinese stocks trade at well below their book value. The float is 10.41 million shares on 24.42 shares outstanding, far higher than CREG or DELT.
YECO, NCTY and CCCL all spiked well over 100% on flimsy, old or non-existent news. With Chinese stocks back in play, CREG and DELT are prime candidates to spike 100% or more out of nowhere like these stocks. We think it can happen sooner rather than later. All three of the aforementioned stocks will have attracted shorts thanks to their high volume and volatility. They can move back up on a short squeeze at any time, bringing the entire industry up and pouring gasoline onto any rise of these two undervalued, low float plays.
Disclosure: We are long CREG and DELT
Bitcoin has gone from a concept worth pennies a few years ago to worth thousands of dollars. It may appear to some who are late to the game that the opportunity to get rich is gone. However, there are still plenty of ways to make some money trading in bitcoin and other cryptocurrency. Here are some links to valuable reports and strategies:
The Cryptocurrency Codex from the Cryptocurrency Institute
Secrets To Unlimited Free Bitcoin
The Crypto-Currency Evolution eBook
Bitcoin Complete Guide for Dummies
The Bitcoin Miracle Guide
The Bitcoin Cheat Code Book
The Crpytocurrency Course
Bitcoin Investing Live
If you're interested in making money investing or trading the stock market, here are some good resources to assist you. This includes technical analysis, investing in the weed sector, dividend stock investing, gold and commodities, sector rotation, options trading and microcap trading strategies.
Microcap Millionaires Free Video: Cheap Gold Miner Set to Soar in Fall 2017
The dividend stock report from dividendstocksonline.com
The dividend stock report from Dividend Stocks Rock
Top rated signals for binary options from binaryoptionsprosignals.com
Goldmasterinvesting.com Ocean Of Gold Report for the top 15 gold mining companies
Trader Review shows how to time the market with its "Percent of X" indicator
The Trader's Academy Club
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MyBB: A Forum For Investors and Traders
Spartan Trader Forex Academy Live Daily Trading Room
Try the Z Code System if you're looking for other ways to make money systematically outside of the stock market.
Top rated signals for binary options from binaryoptionsprosignals.com
Goldmasterinvesting.com Ocean Of Gold Report for the top 15 gold mining companies
Trader Review shows how to time the market with its "Percent of X" indicator
The Trader's Academy Club
The Wealth Builder's Club from beatthemarketanalyzer.com
MyBB: A Forum For Investors and Traders
Spartan Trader Forex Academy Live Daily Trading Room
Try the Z Code System if you're looking for other ways to make money systematically outside of the stock market.
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