Wednesday, November 11, 2009

Louis Navellier strikes back with AAPL

Unbelievable. Louis bought AAPL again. After he sold it at $100 in November 2008, he bought it again now at $200, after it moved up 150% in 7 months.
I have no words to comment this guy...

Thursday, September 17, 2009

What happened next...

You may remember Louis Navellier's trade with FSYS.

he bought it on August 28th 2008 at around $52 and sold it on March 6th 2009 at no more than $14.59 for a 70% loss, after trying to push it for months in his spam newsletters.

But what happened after he sold it?

Yes, FSYS is currently trading at $35, so if you did the opposite of what Mr. Navellier said you should have cashed the 130% profit he missed.

Tuesday, September 15, 2009

Louis Navellier and L???

He bought it back.

I cannot tell you which stock it is, since it is still in $5.000/year Quantum Growth portfolio.
But I can tell you that Mr. Navellier bought it on May 11th at $45.99, sold it on August 17th at $42.92 and just bought it back yestarday at $50.56.

A 6% loss (ok, that's peanuts) and a 17% missed profit.

Wednesday, September 9, 2009

New buy from Louis Navellier

You probably got this:

Your Top Stock Pick: Apple
Last week, I asked you to
send me an email to let me know which stock you’re most interested in right now. I received over a hundred emails with a wide variety of stocks that readers like you are curious about investing in, so thank you to everyone who wrote me.
As I combed through my inbox, one company kept popping up: Apple (
AAPL). So in response to the host of writers who asked me about this trendy tech firm, today we’ll take a bite out of Apple to see what this stock is made of. Many thanks to Richard F., Santosh J., Michael B., Luke Y., Lydia L., Ted, Neal V., Drew, Roy R. and all the others who wrote in suggesting this pick. (Note: You can email me your suggestions for our next stock of the week at
Mac vs. Microsoft
Apple has almost single-handedly redefined the consumer electronics market with innovative products—from changing the way we listen to music with the iPod to redefining the role of cell phones with the iPhone. But don’t think this company is all fun and games. Apple continues to make inroads into the computer market and erode the market share of fellow tech icon Microsoft (
MSFT). The Mac vs. PC rivalry is more than just a cute ad war, but a real bottom-line issue.
I’m a big fan of those “Mac vs. PC” ads that are all over the place—and not just because they’re funny. It’s because I think they provide a glimpse into the corporate culture of each company. You see, Apple is at heart an inventive company looking to grow by creating the next big thing. On the other hand, Microsoft is an established giant that keeps doing what it has always done well… and then using the profits to purchase a smaller company’s ideas and leverage them to even bigger returns. Apple’s strategy is obviously much more glamorous and appeals to image-conscious consumers, however both of these strategies have merit.
In this installment of Stock of the Week, I’ll explain how these separate strategies have resulted in very different performance for each company’s stock—and which of these tech powerhouses is a better investment right now. Let’s dive in!
First of all let me say I love Apple products. My laptop is a Mac, one of my desktops is a Mac, I use an iPhone and I believe Apple is much better than competitors (from Microsoft to RIMM).
But I do not think this is a good time to dive into AAPL. It just doubled since January. Mr. Navellier likes to jump on a stock after it doubled. I see it quite risky. Only time will tell us who is right.

Tuesday, September 8, 2009

Tobin Smith and Josh Levine

If you are planning to subscribe to, you'd better have a look at the current portfolio and at the 2009 closed positions.
Current Portfolio
Close Positions 2009

Thursday, September 3, 2009

Louis Navellier, EXCH and PAR

A couple of sells for Louis Navellier's Emerging Growth subscribers this month.
In addition to some recent sell alerts (maybe I will come back oh these later on) he decided his subscribers should sell EZCH and PAR.


EZCH was a new buy in February 2009 issue of Emerging Growth (edited on february 6th).
EZchip Semiconductor (EZCH) is a great company in a smart transition. With a number of high-profile products in the computer realm, EZCH recently decided to shed some of its older products to focus on high-speed networking chips.
This is not only a smart move in these challenging times, since it trims EZchips overhead and production costs, but a smart move in the long run as the wireless revolution demands continued maintenance and improvements to networks all around the world.
6 February 2009 In the past four quarters, EZchip Technologies’ sales have risen 72.2% in the past four quarters, while its earnings have risen 160%. Much of the improving profitability of the company is not only due to its strong sales growth, but also the fact that the company’s operating margins are improving after it phased out its unprofitable products and operations. The stock is a great buy.

Buy Price $15.60
Buy below $19

February 13th weekly update
EZchip Swings to a Profit
New buy EZchip Semiconductor (EZCH) swung to a profit in the fourth quarter and posted a 67% rise in revenues. Believe it or not, this stock has no analyst coverage, so it’s difficult to calculate an earnings surprise, but the company did earn $1 million, or 4 cents a share, compared with a loss of $0.6 million, or 3 cents a share, in the year-ago period. Revenue rose to $9.6 million, and EZchip said that it is aiming to expand its business in 2009 and beyond, even in this challenging economic environment. The stock has trended up since Friday, and remains a great buy.

March 2009 issue
EZchip has phased out its legacy products to focus its network processor products. The company also closed its NetGuard subsidiary. Overall, the company’s sharper focus on its networking chips bodes well for future growth.
Buy below $14

April 2009 issue
EZchip Semiconductor (EZCH) has phased out its legacy products and closed its NetGuard subsidiary to focus on its networking chips. The one-time expenses may show up on the quarterly earnings report, but I have faith in the long-term prospects of this company. In the fourth quarter, EZchip's earnings rose five fold to $2.6 million or 10 cents per share compared with $0.4 million or 2 cents per share in the same quarter a year ago. Explosive growth like that proves this company deserves a place on our Buy List!

April 17th weekly update
Since last month’s issue, our Buy List is up 7%, led by Top 10 stocks EZchip Semiconductor (EZCH) and Interoil (IOC), which are both up 23.5%.

May 2009 issue
EZchip Semiconductor (EZCH) has been trying to streamline its business to focus more on its networking chips business. This stock has gained a lot of momentum since last month's issue, up 23% in just under four weeks. EZCH is scheduled to report earnings on May 7, where I expect another strong quarter.

May 8th 2009 weekly update
EZCH: EZCH Beats Estimates, but Lowers Outlook
Israel’s EZchip Semiconductor (EZCH) beat estimates during the first quarter, but lowered its revenue outlook for the full year, which has taken a toll on this stock’s share price. Revenue in the first quarter of 2009 totaled $9.8 million, an increase of 42% compared with the same period a year ago. Net income was $1.4 million or five cents a share. Analysts were expecting earnings of two cents a share, so EZchip posted a solid 150% earnings surprise.
Shares of this Top 10 stock are down 9% since last month’s issue because one of the company’s principal customers has said that it will substantially reduce its purchases of processors from EZchip in order to consume existing inventory. Needless to say, this will significantly impact EZCH’s revenue during the second quarter. The good news is that EZchip believes that sales by this customer will continue to grow, and its purchases of our stock’s processors will return to current levels no later than June 2009.

Not a single word on June 2009 and July 2009 issues

August 2009 issue
Upcoming Earnings Reports
Monday, August 3: EZchip Semiconductor (EZCH)...

August 7th 2009 weekly update
EZCH: EZchip Semiconductor Tops Estimates
On Monday, EZchip Semiconductor (EZCH) reported a net loss of 3 cents a share, but this was much narrower than analysts were expecting so the company posted an impressive 40% earnings surprise! Total revenue for the quarter also came in slightly above estimates.
The reason EZchip fell into the red this quarter is because one of its biggest customers decided to use up its existing inventory instead of purchasing new processors. This has been a problem for many businesses in the first half of 2009 as consumers cut back on spending. But EZCH's orders have already started to rebound before many of its competitors, and the company now forecasts it will exceed first-quarter 2009 revenue levels in the third quarter after this strong earnings report.
This stock is currently "on hold," so be sure to check our Buy List on Monday for any change in EZCH's fundamentals. Remember, I do NOT want you to sell any companies

September 2009 issue
I now want you to sell EZchip Semiconductor Ltd. (EZCH) and 3Par Inc. (PAR). EZchip posted an excellent 40% earnings surprise earlier this month, but I think the company is being a bit aggressive on their forward guidance and won’t be able to live up to their estimates. I want you to exit the stock now ahead of any possible downward revisions to third-quarter numbers.
Price around $12.


In his July 2009 issue Mr. Navellier told his subscribers to buy PAR. I do not have the exact date, but this issue should have been released at the very end of June or at the very beginning of July 2009.

Mr. Navellier was writing: 3Par Inc. (PAR) is a leader in the high-end data storage market. The company’s servers and software let large enterprises consolidate data management while allowing differentiated service levels—in layman’s terms, 3Par’s cutting edge products allow big companies to buy less equipment and actually do more, and that saves money in the long run. 3Par’s customers include large corporations and government agencies worldwide, with a client list that includes, Hilton Grand Vacations and the U.S. Army. PAR was founded by veterans of Sun Microsystems, and is the definition of a high-tech leader.
Needham recently initiated coverage on the company with a “Buy” rating, and with good reason. In its latest quarter, 3Par’s sales rose 36.6% to $48.5 million compared with $35.5 million in the same quarter a year ago. During the same period, the company posted a loss of $907,000, or 1 cent per share compared with a loss of $1.2 million or 2 cents per share. 3Par’s operating margins continue to improve, and it should be posting improving earnings in the upcoming quarters. The stock is a great buy and should ride the recent strength of the tech sector to big profits.

PAR price was between $11.00 and $12.50.

Nothing on August 2009 issue, but some words on August 8th weekly report: PAR: 3Par Beats the Street Our data storage provider 3Par (PAR) beat Wall Street's estimates Monday, breaking even for the quarter while Wall Street was expecting a loss. The company also topped expectations on sales, with reported revenue of $44.5 million compared with $43 million in the same period last year and forecasts of just $44.4 million.
Even though 3Par just broke even this quarter, the company still grew sales year-over-year in a very challenging market and this should not be overlooked. The stock's market share continues to expand, and this should continue in the coming months. PAR is the go-to firm for companies looking to boost their storage utilization rates and bring their costs down, and I continue to expect big things from this stock.

PAR was already below $10.

Finally, the September 2009 issue: 3Par is also a sell because their upcoming earnings are in question. The company managed a 100% earnings surprise in the last quarter by breaking even instead of reporting a 1-cent loss. However, looking forward, I no longer see a repeat performance. Analyst expectations have been revised downward for the coming two quarters and now is simply the right time to exit the stock.

Last week PAR closed at $9.14.

Wednesday, September 2, 2009

Robert Hsu and TSM

On a cold January evening Mr. Hsu wrote to his China Profit Strategy paying subscribers:

In the current market, stock valuation and momentum become very important. Stocks that fail to maintain strong growth momentum will be vulnerable to sharp declines. In the face of slowing U.S. consumer demand for electronics and a weaker company outlook, I want you to sell two stocks that focus on the U.S. electronics market -- Apple (NASDAQ: AAPL) and Taiwan Semiconductor (NYSE: TSM). These are not the kind of stocks we want to be in right now and though I like these companies, I must advise you to sell them for now. We could very well come back when the dust settles for another go.

It was a cold January 24th 2008.

Now let's have a look at:
  1. What Mr. Hsu was saying a few weeks before
  2. What happened after January 24th
What Mr. Hsu was saying a few weeks before

January 10th

Taiwan Semiconductor (NYSE: TSM): Investment bank Credit Suisse recently published a report saying that Taiwan Semiconductor should be able to withstand the industry slowdown. The brokerage firm cited reasons such as valuations near three-year lows and its size and balance sheet strength. I agree with the Credit Suisse's analysis. Taiwan Semi will report its fourth-quarter earnings on January 31 before the market opens. Buy TSM under $13.

January 17th
Taiwan Semiconductor (NYSE: TSM) said that December sales increased 31% from a year ago to 30.0 billion Taiwan dollars ($923 million). Full-year sales for 2007 totaled 322.6 billion Taiwan dollars ($9.9 billion), up 2% from 2006. The increase in sales is a good sign for the company. Buy TSM under $13.

What happened after January 24th
Mr. Hsu did not wait for the earnings report on January 31st and told his subscribers to sell on January 24th.
He suggested (better, he ordered to buy it below $10.50) in his October 2006 issue of China Profit newsletter:
TSM is truly a world-class semiconductor company. After my visit to the company, I’m more bullish than ever about its prospects. Buy TSM under $10.50. I’m targeting gains of 30% over the next six months, and maybe more over time.

So Mr. Hsu was targeting at least $13.50 but TSM never passed $12...

On January 24th TSM closed at $8.64, a -17% for Mr. Hsu. But doing the contrary he said and buying that day would have given the opportunity to sell over $11 between May and June 2008 for the 27% profit Mr. Hsu missed.

Tuesday, September 1, 2009

Louis Navellier and CSUN

CSIQ was not the only disaster in Louis Navellier's $5.000/year Global Growth solar plays. He also played a remarkable trade with CSUN. Actually, he traded CSUN twice from September 2008 and April 2009. Let's go.

September 2nd 2008
China's China Sunergy (CSUN) is an exciting alternative energy company that makes photovoltaic cells used in solar energy panels. The company's China plant produces up to 320 megawatts of solar cells per year. The vast majority of its sales come from within China, and as this nation's massive economy struggles to reduce pollution but still provide power to its crucial manufacturing companies, solar will be an important part of the future. Global demand for solar power is expected to more than double, from 6-gigawatts in 2008 to 14-gigawatts in 2010, and the sheer size and industry of China makes it a fantastic market for this growth. But Sunergy is doing pretty well in the here and now, too! In the second quarter, China Sunergy's earnings rose to 8 cents per share, compared with a net loss of 14 cents per share a year ago, and sales nearly doubled. The analyst community was blown away by CSUN's whopping 166.7% earnings surprise and a 17.8% sales surprise! Rising costs for polysilicon, a key raw material in photovoltaic cells, has cut into margins a bit, but the company has continued to grow and now has sufficient economies to weather this increase. The stock is a great buy but it can be thinly traded, so I recommend that you only place a limit order within $0.10 of the stock's previous close. If you don't, your purchase could artificially inflate the price of the stock, and then you'd take a hit later as the market corrects. You can also spread out your purchase over several days instead of buying all at once.
Buy below $12.18
Buy price: $9.98

September 8th 2008
Buy below $10.85

September 15th 2008
Buy below $9.68

September 22nd 2008
China Sunergy Co. Ltd. ADS (CSUN) was added to the NASDAQ clean-energy market index today. This should help its price performance in the near term. The NASDAQ Clean Edge U.S. Liquid Series Index will add six China stocks today, including China Sunergy. This index is designed to track the performance of clean-energy companies that are publicly traded in the U.S. The Index includes companies engaged in the manufacturing, development, distribution and installation of emerging clean-energy technologies such as solar photovoltaics and biofuels.
Buy below $10.98

September 29th 2008
China's China Sunergy (CSUN) said last Thursday that it had signed a seven-year sales agreement with Wuxi Guofei Green Energy Source Co of China. The deal calls for Sunergy to provide Wuxi with 10 megawatts of solar cells each year from 2009 through 2015.
Buy below $8.30

At the beginning of October 2008 even Mr. Navellier realized the situation was not good and his portfolio was full of crap. So, instead of giving increasing buy below prices he started to give decreasing sell above prices.

October 6th 2008
Sell above $7.28

October 13th 2008
Sell above $6.20

October 20th 2008
Sell above $5.28

October 27th 2008
Sell above $4.88
November 3rd 2008
Sell above $4.62
November 10th 2008
Three stocks hit our "Sell Above" targets last week: China's China Sunergy Company (CSUN) Ireland's Icon (ICLR), and Israel's Partner Communications.
So, after having bought CSUN at $9.98 and decreasing the sell price for one month, Mr. Navellier was finally able to sell it at $4.62 for a 53% loss.
He was so happy of this performance that on March 30th 2009 he decided to buy CSUN again, at $2.97.
China's China Sunergy (CSUN) and Bermuda's Validus Holdings (VR) join the buy list this week as we look to build on an already impressive track record for March. Here are the details:
China's China Sunergy (CSUN) makes photovoltaic cells used in the manufacture of solar energy panels. Through its operating subsidiary Nanjing PV, the company produces up to 320 megawatts of solar cells per year and is expanding its output. In addition to making positively charged P-type PV cells, China Sunergy is also conducting research into production of new types of solar cells, including negatively charged N-type cells. The science behind this is very complex, but in a nutshell this provides CSUN with greater versatility and a chance to broaden its market share. While some German firms buy China Sunergy's PVcells, the vast majority of its sales come from within China itself, so if it can expand its international business, the sales potential would be tremendous.
The company recently entered into an agreement to supply solar photovoltaic products to Global Service in Taiwan. Under the agreement, China Sunergy will supply up to 35 megawatts of solar photovoltaic products to Global Service this year. I will say that the company warned that it had order cancellations in the fourth quarter and does not anticipate being profitable until the second quarter–but I remain very confident in CSUN's profit potential. An oversupply of photovoltaic cells due to the economic downturn continues to weigh on the solar industry in the wake of a pullback in solar subsidies by Germany and Spain.
Last week, it was reported that China's Ministry of Finance is going to subsidize solar projects. Government subsidies are what transformed places like Germany and Spain into solar hotspots, so this is a great opportunity. With enough government support, China's domestic solar market could come to dwarf the European markets and help its domestic solar industry become increasingly dominate worldwide. CSUN broke out last week on this news and is a good buy for aggressive investors. China Sunergy may be a bit more volatile than some of our other holdings, but could easily double your money in just several weeks if the cards play out in our favor!
Buy below $3.39
April 6th 2009
Buy below $3.77
April 13th 2009
Buy below $3.75
April 20th 2009
This week, I recommend that you sell China's China Sunergy Company (CSUN), Israel's NICE-Systems (NICE) and Taiwan's Siliconware Precision Industries (SPIL).
While China is still a very hot spot and the focus of our Buy List, China Sunergy (CSUN) has been pretty sluggish and has lagged behind the rest of our stocks. The stock got caught up in the broader market slide across the last week, but otherwise would have been essentially flat since its purchase three weeks ago. I want you to trade out of this stock and invest in other Chinese companies that are beating the market significantly. At Global Growth, we look for market leaders–not stocks that run with the herd.
Close price: $2.61
Once again, the sell price was lower than every buy below given. $2.97 to $2.61 makes another 12% loss, to be added to the previous 53%.

Monday, August 31, 2009

Louis Navellier and ACN

This is the story of an old trade, the position was opened on December 2008 and closed on March 2009, but it is interesting to read so to better understand the real performance of Louis Navellier's $5.000/year services.

Mr. Navellier decided to buy ACN on December 1st 2008, when it closed at $29.06. He wrote the following words to his subscribers:
Bermuda's Accenture (ACN) is a familiar name in the U.S. and is the world's largest consulting firm. The company offers management consulting, information technology and systems integration, plus business outsourcing services. Consulting firms often prosper in hard times, when many companies need to reorganize and outsource labor. Accenture operates worldwide, in over 200 locations in about 50 countries, and has a wide array of government-based clients, including the U.S. Air Force.
Accenture's fiscal year ends August 31, and for its final fiscal quarter, its earnings rose 34% to $434.8 million or 67 cents per share, compared with $316.8 million or 50 cents per share in the same quarter of 2007. During the same period, sale rose 17% to $6 billion. New bookings for the quarter rose to $7.67 billion, a quarterly record. Looking forward, Accenture forecast net sales growth of 9% to 12% this fiscal year, on earnings per share of $2.85 to $2.93, for a low current P/E ratio of 10 to 11. Buy below $29.90.

There are two things to notice in ANC's chart:
  1. The actual price movements and buy below prices until sell date March 30th 2009 (see below for details)
  2. ACN's trend after Mr. Navellier sold it

December 8th 2008

Buy below $29.16

December 15th 2008

Bermuda's Accenture (ACN) won an $87 million contract for a new integrated tax system for the state of Maryland. The award was unanimously approved by all leading state officials, including Governor Martin O'Malley, Treasurer Nancy Kopp and Comptroller Peter Franchot.

Buy below $29.88

December 22nd 2008

Bermuda's Accenture (ACN) reported that its first fiscal first-quarter net income rose 26%, due to 6% revenue growth plus a lower net tax rate. The stock rose more than 10% last week on the news.* Accenture's first fiscal quarter, which ended November 30, delivered income of $479.9 million ($0.74 a share) up from $381.3 million (60 cents a share) in the same quarter a year ago. This beat analyst estimates of 68 cents a share. In addition, the company's effective tax rate fell to 26.6%, down from 34.6% a year earlier. Gross profit margins also rose, to 31.4% from 30.1%.

Buy below $32.93

December 29th 2008

Buy below $32.77

January 5th 2009

Buy below $34.82

January 12th 2009

Buy below $34.73

January 20th 2009

Buy below $32.82

January 26th 2009

Buy below $32.97

February 2nd 2009

Buy below $32.75

February 9th 2009

Buy below $33.98

February 17th 2009

Buy below $31.23

February 23rd 2009

Buy below $29.75

March 2nd 2009

Buy below $28.70

March 9th 2009

Buy below $27.93

March 16th 2009

Bermuda's Accenture (ACN) will release its fiscal second-quarter earnings on March 26. Last week, Accenture announced that it had teamed with Connecticut Light & Power Company, a subsidiary of Northeast Utilities, in a pilot program to test smart meters. This program will gauge residential, commercial and industrial customers' interest in peak time-based energy rates–meaning energy is cheaper when demand is less and more expensive when demand is high. The pilot, approved by Connecticut's Department of Public Utility Control, is scheduled to begin in June. With about 3,000 customers participating, this will be the largest customer-focused smart-metering pilot in North America.

Buy below $30.91

March 23rd 2009

Buy below $32.70

March 30th 2009

This week, I recommend that you sell Bermuda's Accenture (ACN) and British Virgin Islands' UTi Worldwide (UTIW). Both companies have essentially moved sideways since their purchase, and haven't exhibited the strength we seek in our Global Growth stocks. After lackluster earnings reports, it's now time to sell.
Now more than ever we need to make sure we hold only the top international companies since the potential for profits in the coming weeks is tremendous, so I don't want you to be stuck in a run-of-the-mill stock that is standing still. Cash out your positions in ACN and UTIW, and get behind our new buys instead.

Close price was $27.83.

Note that the sell price was lower than every single buy below price in 4 months.

And after Navellier's sell order? What did ACN do? It moved from less than $28 to over $36 in August 2009. So, in addition to the 4% loss (actually peanuts) Mr. Louis Navellier also scored an impressive 28% missed gain.

Thursday, August 27, 2009

Robert Hsu and CSR

Another masterpiece from Mr. Robert Hsu is the CSR trade.
Mr. Hsu decided to buy CSR on August 21st 2008, at $14.60.
Buy China Security & Surveillance Technology
To take advantage of the growing demand for security and surveillance technology in China, I'm recommending a domestic leader in the Chinese security and surveillance industry -- China Security & Surveillance Technology (NYSE:
CSR). I haven't been this excited about a new China Strategy stock recommendation since I recommended Mindray (NYSE: MR) and New Oriental Education (NYSE: EDU) nearly two years ago. That's because CSR fits all of the parameters we like: It was started by private entrepreneurs, it is a leader in a fast-growing industry, it's earnings are growing at over 80% a year, it is trading at an attractive valuation of only 7 times this coming year's earnings, and the company's CEO is regularly buying stock with his own money at up to $30 a share (shares are trading below $15).
Based in Shenzhen, China Security manufactures, distributes, installs and maintains security and surveillance systems in China. And it provides many surveillance products including hardware, software, design, implementation and technical support to its customers, which include government, corporate and commercial clients.
With Chinese demand for security and surveillance products growing, China Security has several manufacturing facilities, a R&D facility in China and an extensive sales and service network throughout the country. And the company is able to compete internationally with a lower labor cost, established distribution channels and a local sales team.
China Security has truly become a leader in this industry over the years and has achieved earnings growth of 80% or higher, as a result. Just look at some of the recent financials:
China Security achieved strong top-line growth from 2002 to 2007 when revenue jumped to $240 million in 2007 from $16 million in 2004. Plus, net income soared to $46.6 million in 2007 from $5.9 million in 2004. And most recently in early August, the company posted strong second-quarter earnings.
Net income soared 81% year-over-year to $7.7 million, or 17 cents per share, from $4.3 million or 11 cents in the prior year's same quarter. Revenue increased 78% to $92.7 million from $52.1 million in the second quarter of 2007. Gross margin -- one of my favorite indicators of a company's operating performance -- improved to 32.8% from 28.6% in the same period last year and 30.5% in the first quarter.
Looking ahead, I'm looking for continued strength as is the company -- its third-quarter revenues are expected to be $110 to $115 million and the full-year 2008 revenue $400 to $410 million. And China Security raised its adjusted 2008 net income forecast to $73 to $80 million, or $1.60 to $1.77 per share.
What makes this company particularly intriguing right now is that China Security is trading at bargain levels. This largely undiscovered stock was unfairly beaten down in the recent Chinese stock sell-off since October, as speculators sold it with other stocks. And now it is trading at a price-to-earnings ratio of only seven times this coming year's earnings. Talk about an attractive combination of strong growth and attractive valuation!
I want you to buy CSR under $19. I'm targeting $27 by the end of this year, which would give us a nice 50% gain.
CSR was able to go down to $2.47 (more than 80% loss) in March 2009, then partially recovered.

Mr. Hsu tried to explain what happened and basically told his readers to hold CSR for one year until on August 20th 2009:

China Security and Surveillance Technology is China's leading security devices company. It recently was finally able to negotiate better terms with its largest creditor, Chicago-based hedge fund giant Citadel. Basically, instead of paying a big lump sum at high interest rate to Citadel in 2012, CSR is getting better terms and the option to pay back the debt in installments. Despite this being a positive development for the company long term, it weakens the company's cash-flow position in the short-term.
I have told you before that, given the company's weak cash position, I am not comfortable with the company's aggressive acquisition strategy. In the past month, the company announced two more corporate acquisitions. So, the long-awaited renegotiation of Citadel notes gives us a good opportunity to sell CSR and put the money into better opportunities. Sell CSR.

Price was $7.27 for a 50% loss.

We should learn at least two things from this lesson:

  1. Robert Hsu is a gambler (with other people's money)
  2. Always use stop loss orders (before going down 80%)