Small cap Chinese or China focused stocks CD International Enterprises Inc (OTCMKTS: CDII), JinZangHuang Tibet Pharmaceuticals, Inc (OTCMKTS: JZHG) and Big Tree Group Inc (OTCMKTS: BIGG) have all been getting noticed lately by American stock promoters. Of course, Chinese stocks in general and especially Chinese small caps have earned themselves a bad reputation for burning unwary investors or traders, but China is the world’s second biggest economy – meaning investors and traders alike cannot overlook the opportunities there. So will these Chinese or China focused small caps deliver what their promises or rather what the promoters are promising? Here is a quick reality check:
CD International Enterprises Inc (OTCMKTS: CDII) Announces New Deals in South America
Small cap CD International Enterprises is a US based company that produces, sources, and distributes industrial commodities in China and the Americas, and provides business and financial corporate consulting services. On Friday, CD International Enterprises closed at $0.120 for a market cap of $6.86 million plus CDII is down 33.7% over the past year and down 95.2% over the past five years according to Google Finance.
What’s the Catch With CD International Enterprises Inc? According to various disclosures, transactions of $1.5k, $2k, $2.5k and $4k have or will occur to mention CD International Enterprises in various investment newsletters. Last Tuesday, CD International Enterprises announced that CDII Minerals Peru SAC, a jointly owned subsidiary of CD International and Minera Mapsa, S.A., had entered into a supply agreement with an unnamed Peruvian mining company to distribute high-grade (over 63.5%) hematite iron sourced from the Apurimac region in Peru. Earlier in the month, CD International Enterprises announced that CDII Minerals, Inc had successfully completed an initial shipment of Bolivian iron ore to a leading metals trading company in China plus the company announced that Minera MAPSA S.A., a Peruvian mining and exploration company, had completed the formal transfer of title of all mining concessions for 178,000 acres of mining properties in southern Peru to CDII Minerales Peru SAC. A quick look at CD International Enterprises’ financials reveals revenues of $18,582k (most recent reported quarter), $16,973k, $16,781k and $32,803k for the past four quarters along with declining net losses of $653k (most recent reported quarter), $1,912k, $1,939k and $45,506k. At the end of June, CD International Enterprises had $1,025k in cash and $11,321k in receivables to cover $23,620k in payables and $34,585k in current liabilities. So at least the net losses are trending in the right direction and the company has some cash on hand.
JinZangHuang Tibet Pharmaceuticals, Inc (OTCMKTS: JZHG)Has Promoters Talking the Stock Up
Small cap JinZangHuang Tibet Pharmaceuticals is a China-based company that distributes Tibetan pharmaceutical and nutraceutical products. On Friday, JinZangHuang Tibet Pharmaceuticals fell 12.22% to $0.0711 for a market cap of $4.10 million plus JZHG is down 35.4% over the past year and down 28.9% since March 2009 according to Google Finance.
What’s the Catch With JinZangHuang Tibet Pharmaceuticals? According to various disclosures, transactions of $2k and $15k have or will occur to mention JinZangHuang Tibet Pharmaceuticals in various investment newsletters. I am not seeing any news on the newswires from JinZangHuang Tibet Pharmaceuticals itself but obviously someone is interested in talking up the stock or rather in paying to have the stock talked up. Moreover, the stock spiked as high as the $0.17 level last Tuesday. A quick look at JinZangHuang Tibet Pharmaceuticals’ financials reveals $4,263k (most recent reported quarter), $4,044k, $3,334k and $2,717k for the past four reported quarters along with net income of $2,325k (most recent reported quarter), $2,202k, $1833k and $1,443. At the end of last March, JinZangHuang Tibet Pharmaceuticals had $16,365k in cash to cover just $986k in accounts payable. Those financials look very solid but one has to wonder the motivation behind why the stock is being promoted by American stock promoters.
Big Tree Group Inc (OTCMKTS: BIGG) Announces Important Deals
Small cap Big Tree Group is headquartered in Shantou, China, a city known in the toy industry as the premier location for toy manufacturing in China, serves as a "one stop shop" for the sourcing and distribution of toys and related products. Big Tree Group acts as an authorized agent for over 8,000 toy manufacturers in China offering in excess of 300,000 varieties of toy products including remote control toys, digital toys, sports toys, play sets, educational toys, dolls and infant toys. On Friday, Big Tree Group rose 5.56% to $0.190 for a market cap of $1.97 million plus BIGG is up 18,900% over the past year according to Google Finance.
What’s the Catch With Big Tree Group? According to various disclosures, a transaction or transactions of $5k has or will occur to mention Big Tree Group in various investment newsletters. Last Friday, the Big Tree Group announced the completion of a delivery of purchase orders from a leading US based operator of dollar stores valued at approximately $650,000 with the orders being for various water gun and play stick products. In addition and last Wednesday, the Big Tree Group announced the completion of a delivery of purchase orders valued at approximately $1 million from a leading multi-national operator of discount stores or rather from its Mexico operations. The orders were for seventeen different toy products ranging from electronic learning games and instruments to play sets and dolls plus the Big Tree Group sees significant opportunity to increase sales with this customer in 2014. A quick look at Big Tree Group’s financials reveals revenues of $11,863k (most recent reported quarter), $7,448k, $14,568k and $8,608k for the past four quarters along with net income of $333k (most recent reported quarter) and $65k, a net loss of $94k and net income of $942k. At the end of June, Big Tree Group had $31k in cash and $10,908k in receivables to cover $7,976k in accounts payable and $11,795k in current liabilities. Those financials sort of look ok – if you trust the financials of small cap Chinese stocks…