tag:blogger.com,1999:blog-6154015141484451605.post8545612508374552464..comments2024-03-28T07:17:09.640+00:00Comments on The Trading Day: Cemeteries and Cement (CGPI, CRJI)The Travellerhttp://www.blogger.com/profile/17122257677784990244noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-6154015141484451605.post-11374643147426132582010-07-16T09:08:32.440+01:002010-07-16T09:08:32.440+01:00Redstone will certainly have to raise money in 201...Redstone will certainly have to raise money in 2011, but for now they have high inventories and about 20% of their market cap in cash. As a property developer they should be able to get debt financing instead of raising funds at such a low P/E. <br /><br />A short term boost might come from the press release after the close where CGPI announced adjusted EPS of $1.53 and raised 2011 guidance by 20%. This might attract new short term investors and I wouldn't be surprised if the stock traded towards $5 into Monday's conference call.The Travellerhttps://www.blogger.com/profile/17122257677784990244noreply@blogger.comtag:blogger.com,1999:blog-6154015141484451605.post-48774457777491229802010-07-16T06:15:48.898+01:002010-07-16T06:15:48.898+01:00> We can not apply very high multiples to a com...> We can not apply very high multiples to a company that is still in the early stages as a public company, but I believe the current valuation at roughly 3x this year's earnings doesn't do China Redstone justice.<br /><br />I totally agree with this. Just want to add 2 cents. Other than in the early stage of being a public company, the stock is also very illiquid and fundamentally, the company won't have enough operating cashflow to fund the next 2 years capex, meaning that they are guaranteed to make more fund raising at below PE3! They are going to issue shares to private investor below PE3. Not good for those who buy from the market - eps dilution, almost no volume, no uplist in the near future, big capex ...AhYaphttp://www.ahyap.com/noreply@blogger.com