Dividend policy 25%of Net Income - .16 to .20~ 7% yield payable during November 2018.
NO LONG TERM DEBT
THE COMPANY IS A LEADING MANUFACTURER OF WIRE AND CABLE PRODUCTS FOR THE TELECOMMUNICATIONS AND ELECTRIC POWER INDUSTRIES IN THE ASIA-PACIFIC REGION.
MARKET CAP~ $34.81 MILLION
BOOK VALUE $16.80
REVENUE $425 MILLION
NET INCOME $8.7 MILLION
52 WK RANGE $2.25~$3.10
CURRENT DIV YIELD 3.9% FOR 2017 DIVIDEND TO BE PAID (.18) - 7% FOR 2018 PAYABLE NOVEMBER 2018
LONG TERM DEBT=0
DEBT TO EQUITY .28
INSIDERS OWN 75%
SHARES OUTSTANDING 13.8 MILLION SHARES OUTSTANDING
FLOAT 3.39 MILLION SHARES
BUSINESS REGIONS CHINA, HONG KONG, SINGAPORE, AUSTRALIA AND EXPLOSIVE THAILAND.
TOTAL EQUITY $231 MILLION WHICH INCLUDES THE $74 MILLION THAT IS NON CONTROLLING INTEREST~ $16.80 BOOK VALUE
DIVIDEND POLICY~ RECENTLY ANNOUNCED 25% OF THE NET INCOME~ MINIMUM
NOTE: COMPANY (ABCD) OWNS 51% OF A THAILAND BASED COMPANY THAT ACTUALLY HAS A MARKET CAP THAT IS LARGER THAN (ABCD-$34.81 MILLION MARKET CAP)
THE 51% OWNED SUB IS WORTH $49,750,000.00~ SO IN REALITY MUCH LARGER THAN THE (ABCD) $34,810,000.00
THE 51% SUB IN THAILAND JUST DECLARED AND RELEASED A DIVIDEND TO CMPY (ABCD) IN THE TUNE OF $2,189,000! THIS OF COURSE COULD EASILY BE USED FOR ADDITIONAL DIV TO (ABCD)
THIS THAILAND SUB HAS HAD ALL BAHT CONVERTED TO US DOLLARS. FOR 2017 REVENUE EQUALED $249 MILLION AND NET INCOME EQUALED $8.7 MILLION. AND THE DIVIDEND EQUALED .011/SH BASED UPON THE 199 MILLION SHARES THAT (ABCD) OWNS.
(YEAR END FOR THAILAND SUB WAS EQUAL TO 8 BILLION BAHT IN REVENUE AND NET INCOME OF 281 MILLION IN BAHT. THE DIVIDEND .35 BAHT PAYABLE MAY 15, 2018)
ADDITIONAL FOOD FOR THOUGHT:
WHEN WE LOOK AT THE PAST HISTORY OF THIS STOCK IT IS VERY EASY TO CONCLUDE THAT IT SHOULD TRADE AT LEAST 2 TO 3X THE CURRENT SHARE PRICE OF $2.55
CURRENTLY COPPER IS TRADING @ A FOUR YEAR HIGH. FIVE YEARS AGO CMPY (ABCD) HAD REVENUE OF $460 MILLION AND NET INCOME/SH WAS .42 AND NO DIVIDEND. FOR 2017 REVENUE FOR (ABCD) REACHED $425 MILLION AND NET INCOME/SH EQUALED .63 AND A FUTURE DIVIDEND OF .18.
DURING JUNE 30TH 2013 THE STOCK TRADED AT AROUND $4.00/SH. FAST FORWARD TO JUNE 30TH 2018 CMPY (ABCD) THE STOCK TRADED AT $2.55
WE BELIEVE THAT 2018 WILL SEE EVEN HIGHER REVENUE AND NET INCOME/SH BECAUSE OF EXTREMELY RAPID THAILAND GROWTH AND ADDITIONAL BUSINESS IN CHINA. BUSINESS IN CHINA IS EXPANDING BECAUSE OF ENVIRONMENTAL CONCERNS WITH RESPECT TO THEIR DOMESTIC BUSINESSES.
FIVE YEARS AGO THE STOCK WAS TRADING @ 9X AND IF WE USE 9X BASED UPON OUR .63 WE GET A $5.67 SHARE PRICE+.18 DIVIDEND.
THIS OF COURSE IS STILL A SUPER CHEAP STOCK WHEN THE BOOK VALUE EQUALS A $16.80, CASH/SH IS $3.91, NO LONG TERM DEBT, JUICY AND GROWING DIVIDEND, A SUPER FAST GROWTH REGION IN THE WORLD AND A POSSIBLE SPECIAL DIVIDEND BECAUSE THE COMPANY HAS A HUGE CHUNK OF CASH THAT JUST SITS AROUND.
FIRST Q RECENTLY RELEASED~ REVENUE FOR THE FIRST Q $106 MILLION VS $88 MILLION, NET INCOME WAS .01 VS .35 (drop was due to currency changes, copper costs & other extra ordinary related expenses).
DURING THE PAST FEW DAYS CHINA ANNOUNCED FREEING UP $100 BILLION FOR BUSINESS EXPANSION. THIS RECENT DEVELOPMENT BODES EXTREMELY WELL FOR A HUGE BUSINESS FLOOD FOR APWC!
THE JUICY NUMBERS THAN CANNOT BE OVERLOOKED!
If we value APWC based upon the full year of 2017 and apply an actual PE of 10X we get a share price of $6.30. If we value the company @ 1/2 the present book value we calculate a share price of $8.40. If we value APWC @ 1X sales(PSR) we would formulate a share price of over $30.00! This valuation would of course scare the average investor . Let us give it a PSR of .25 (super cheap) which would result in a share price of $7.00. A stock trading @ 2X cash equals a cheap valuation of $7.82. APWC also has a very attractive P/CF and EBITDA (1.21~based upon 2017). Don't forget the juicy 7% dividend payable during November 2018.
OVERALL: EXTREMELY CHEAP DISCOUNTED VALUE AND GROWTH STORY WITH GROWING DIVIDEND.
FINAL THOUGHT: THERE IS ALWAYS THE POSSIBILITY A OF BUYOUT OR MANAGEMENT GIVES UP ON BEING PUBLIC AND TAKES THE COMPANY PRIVATE. IF MANAGEMENT DECIDED TO GO PRIVATE AND PAY STATE BOOK VALUE ($17.00/SH) THAT WOULD RESULT IN 7X THE CURRENT SHARE PRICE.
MAYBE THE REAL RISK IS NOT OWNING SOME OF THIS SUNKEN TREASURE THAT HAS BEEN DUG UP BY S A ADVISORY AND NOW THE CAT IS OUT OF THE BAG.
American Electric Technologies, Inc. ( NASDAQ~AETI~ $1.26)
The Company is a leading supplier of power delivery solutions for the global energy industry. AETI offers power distribution products including low and medium voltage switchgear that provides distribution and protection for electrical systems from electrical faults.
The Company provides "turn-key" power solutions for the upstream, midstream and downstream oil and gas sectors. The Upstream oil and gas refers to the exploration and production of oil and gas . The Company serves customers in the land drilling, offshore drilling, land-based production and offshore production segments of the market.
The midstream oil and gas segment is primarily related to oil and gas transportation, including oil and gas pipelines and compression and pumping stations.The Company also has a customer base in the NG fractionation( separation), cryo, NG to liquids and other NG related plants.
The downstream O&G includes oil refining and petrochemical plants, as well as LNG plants, export facilities and storage facilities.
Power generation and distribution:
The Company works with engines-generator manufacturers and dealers, turbine manufact("EPC") firms and other electrical engineering service companies to provide electric power delivery products and solutions. The Company also provides products and services for renewable power generation including biomass, geothermal and other renewable energy projects. The Company also designs, manufactures, commissions and maintains equipment in base-load, peaking power, co-generation and substation transmission facilities worldwide.
Marine applications include the blue water vessels such as platforms supply vessels (PSV), offshore vessels (OSV), tankers and other various work boats, typically up to 300 ft. in length. The Company also provides solutions to brown water vessels such as barges, dredges and other river and inland water vessels.
The Company uses foreign joint ventures to accommodate business in China and South East Asia.
Revenue 2017~ $47 million vs $37 million(2016). Loss from operations .30 vs .89
Fully diluted shares outstanding~ 8.5 million
Book value end of 2017~ $1.18
NOL from 2016/2017 ~ $15 million ~ $2.00/sh
First Q 2018 fully diluted shares outstanding 8.8 million
cash ~ $627k
Book value end of the first Q~ .86
6/25/2018-The Company recently received a letter from NASDAQ confirming that the Company has regained full compliance for listing.
6 Revenue $8.2 vs $8 million and continued losses of .35 vs .31 (2018 vs 2017)
Backlog end of March 31st 2018 1st Q $25 million
TOTAL BACKLOG AS OF JULY 4, 2018 AT LEAST $47 MILLION~ EXTREMELY BULLISH
On or about April 26th 2018 M&I Electric announced service contract award for 342 MW power plant in Brazil. According to Company, this was a major break-in for M&I Electric Brazil! The award provides for the complete overhaul in-situ of 20 13.8kV, 11MVA diesel generators for a large Brazilian power utility company.
On April 18, 2018 AETI announced the executed agreement to a ten year extention of their BOMAY joint venture in China.
Opinion: We are rating AETI with a strong buy recommendation at current levels for a number of sound reasons:
1. If you review past years it is easy to conclude that the price of Oil has a strong correlation to the price of this stock. During 2014 when Oil was between $100-$80.00 per WTI barrel AETI traded as high as $11.00/sh, but when Oil collapsed to $49.00/barrel during January 2015 the stock sank to $5.00/sh. The shares collapsed because the herd knew that new business was gone and survival mode was now in place. During January 19, 2016 WTI sank to $28.46 (Obama signed the Nuke deal with Iran) and AETI cratered to $2.64.
So we now fast forward a few years to 2018 and Oil once again has been on fire and is currently flirting with $75.00/WTI barrel. The past correlation should easily indicate a much higher share valuation just based upon this specific variable. When Oil traded at this current pricing level AETI was trading @ $6.00/sh! Food for thought!
2. At present we are 6 months into 2018 and AETI has at least a $55 million backlog and another 6 months before 2019! As USA Oil production heads toward 11 million barrels of production/day. Upgrades and new project demand has already begun to alter AETI's backlog to the upside, which in turn will lead to profits and potentially huge profits during 2018 and 2019.
We understand that the earnings picture has no Unicorns and singing mushrooms during the past few years as well as the 1st Q of 2018, but once again the price of Oil plays a large role in new and renewal of contracts. During the lean years there of course was pricing pressure, but now cost of service has been rising because demand is so very strong!
It is not a total pipe-dream that AETI reaches $60 million in revenue during 2018 and may even show a profit of .25/fully diluted outstanding shares. This is just an assumption because once again the price of Crude is up $13.00 since the beginning of 2018
3. On or about May 8th 2018 AETI hired Oppenheimer & Co as its exclusive advisor to explore financing options and strategic alternatives for the company. The company during that time period was actively pursuing solutions to strengthen its balance sheet including equity or debt offering, the purchase or sale of assets, strategic mergers, or other potential actions aimed at increasing shareholder value.. It should be noted that after this presser the company announced $22 million in new contracts! The only problem is that the market -cap is only $11 million . It is very difficult to raise equity that limits dilution when the valuation of the company is so small. We could merger or an offering could happen when higher share valuations are realized.
This opportunity has short and long term appreciation potential. The company announces a contract, the shares blast off every time and at the same time begin a new base. The Company announced their $14 million contract the stock recently ran from .75 to $2.50 and when it announced the most recent contract the the shares ran from $1.14 to $1.90! The "flipper" community would of course be very happy with this kind of action!
We see lots of opportunity in owning AETI at current levels. The shares are traded on NASDAQ. The herd will find this stock and when they do the current level of $1.26 will be a dream come true for investors that like to be ahead of the herd-curve! We rate AETI with a Strong Speculative Buy and believe multiple dollar appreciation could happen sooner than later!
QUADLOGIC CONTROLS CORP (QDLC .25)
The Company has been engaged in the business of electric metering, monitoring and control since 1982. All QDLC metering products feature the Company's proprietary robust power line communications technology. The business consists of 3 segments. First is the design, manufacture and sale of a smart metering system, a line of digital microprocessor controlled meters that communicate with QDLC's Transponder that measures and remotely monitors the time and amount of electricity consumed and other diagnostics. The 2nd segment supports the first and consists of technical services including meter reading, customer billing, and system repair and maintenance The 3rd segment, the Energy Guard system of concentrated metering, is sold primarily to utilities in countries where electricity theft is common. It consists of pole-mounted sealed panels of meters, remote data concentrators and sub-stations based data collectors capable of remote metering, theft and tamper detection and remote power disconnect and reconnect. The Company's customers include real estate development and construction companies, owners and operators of multi tenant commercial and residential buildings, distributors, foreign electric utility companies and licensees.
website: a must read~updated most will be impressed with their client base:
website: http://www. quadlogic.com
The Company's shares trade on the Pinks and their financials are current. Their fiscal year ends Feb 28, 2018.
We believe since the company has finally caught up with their financials that they will start reporting on a more regular basis.
The audited year end numbers for year ended February 28th 2017
book value is slightly negative~$73,000.00
Shares outstanding~ 11.4 million fully diluted
Revenue $13.4 vs $13 million ( 2017 vs 2016)
net income/sh .02 vs loss of (.034) NOL ~ $5 million or .44/sh ( 90% above the share price)
Note; The Company announced on or about January 31st 2018 that it had filed 2 lawsuits in connection with the enforcement of its Mexican license agreement. The Company is looking to recover $7.3 million in unpaid royalties. This equals .64/sh fully diluted. A major rip-off by an ex-employee.
Interesting fact that should also be considered: QDLC spends over .13/sh on R&D during 2017. This is a huge amount of money for a stock that is only trading at .25.
PSR: super cheap .21 ( value of 1 is consider super cheap and undervalued)
PE actual around 12X trail 2017 numbers.
Current price is at 52 week low .25 vs high $1.01
Investor's should realize that there many States that are passing legislation or are currently implementing legislation that mandates the use of metering products that QLDC develops, markets and sells.
Read between the lines: The website looks great. The financials are current. We have some growth and profits. Do not forget that QDLC is also trading @ its 52 week low. As they say buy them when the herd has their heads in the sand and sell them when the unicorns are grazing. We rate QDLC with a strong speculative Buy @ currently depressed prices.
WE MAY BUY, SELL AND OR HOLD AT OUR OWN DISCRETION .We currently own shares in CVM and have been hired for PR for 1 year .We wish to give credit to First Genesis Consulting for some their material that was used within this report
1 YEAR HARD COPY $250.00
1 YEAR PERSONAL CONVERSATION WITH EDITOR $3000.00- ANYTIME ACCESS VIA PHONE
$1800.00 ANYTIME ACCESS VIA PHONE FOR 6 MONTHS- CALL FOR INFORMATION- WE CALL YOU AND YOU CAN CALL US+ FIRST CALL ON RECOMMENDATIONS PRIOR TO ALL OTHERS.
1 TRIAL "NEW" STOCK PICK BEFORE RELEASED VIA EMAIL $100.00- INCLUDE PHONE NUMBER.
SEND CHECK AND PHONE NUMBER TO THIS ADDRESS.
S A ADVISORY, 4708 SOUTH HOLLADAY BLVD, SLC ,UTAH 84117- ANY QUESTIONS CALL 949 922 9986