There’s lots of peripheral stuff to cover related to CGYV which is certainly worth a read. According the media, major shareholder Steve Westly did not get the nod as Secretary of Energy. However, Obama has chosen Nobel Prize Winner Steven Chu as the man to get the job.
Chu happens to be Chinese, which may or may not help. However, his views on the future of the “Green” Movement fit right into the CGYV theme. Here’s a quote:
“If I were emperor of the world, I would put the pedal to the floor on energy efficiency and conservation for the next decade,” Chu said.Tackling energy waste in residential and commercial buildings is a high priority for Chu. He said new designs and technologies in that area could go a long way toward improving heating, ventilation and lighting systems and reducing energy consumption. “Get rid of the wasteful habits and inefficiency and that by far and away will show the biggest gains in the short term,” he said.Chu lists examples of “hybrid thinking” to deliver more energy efficiencies such as cogeneration plants that capture waste heat while producing electricity, but says the dominance of coal-fired electricity is a big obstacle to progress.”
There’s another fantastic article on the future of Energy Efficiency as it relates to China that is a must read:Here’s a quote from the article:“Emission reduction and energy saving is not only an issue of environmental protection, but important to a company’s profitability, especially when the financial crisis deteriorates the economic situation,” said Gu Zhanggen, the Party secretary of the company.
Here’s a link to the entire article. It states inefficient manfucturers are closing down in China. Energy efficient and low pollution manufacturers are experiencing a boom.
http://news.xinhuanet.com/english/2008-12/12/content_10495880.htm
The stock traded sideways this week on lighter volume. At some point, this company is going to end up in the eye of the Hurricane, and the market will find out about it and come for it in a big way.
I wish I knew when it was going to be. The chart shows the stock has drifted back down near its support level:
We’re getting close to the end of the tax selling season, so I would expect the supply side on this one to become almost non existant pretty soon.
With their strong balance sheet, growth, and profitability, it is inevitable someone is going to come for this stock sooner or later, and when they do it will be very hard to buy.
Comments and questions are welcome.
I wonder if CGYV is being sold down because the situation is bleaker in China than we know but some investors see it?
Editor: I believe it is being sold down because the market is bleaker than any of us could have ever seen. There is a slow down in China, but it is far shallower and it will be far shorter lived than the US version. China and India will be back before the US markets.
CGYV seems to keep hitting resistance just above $2, if it can break through $2 do you see it rapidly climbing back above your initial entry point? I love this stock and have built the position from $3 down to $1, I hope your $5 or $6 prediction comes to fruition.
Editor: Three times the stock has gone through $2. Persistence breaks down resistance. One of these volume surges, $2 will become support vs resistance. Then, we’ll see where we go from there. I think to achieve the $5 to $6 number, money will have to seek growth and flow back to the Chinese market. That will happen sooner or later.
That latest 3.3MM contract was a December booking wasn’t it? So 2008 earnings, correct? Thanks in advance.
Editor: I believe so.
have you stop covering this company as well
Editor: Hardly- this is going to be a superstar. This one is doing fantastic, and someday the market will recognize the growth, and the stock will trade to a reasonable valuation.
The new contract implies payment will be made over the next four years . That would mean we can only book 2.25 million in revenues for 2009. Did you calculate that fact when you were listing 09,s revenues ?
Editor: Good question- I suspect the revenues will be booked on delivery and the payments will be carried as a receivable in the balance sheet. As payments are made, receivables will go down and cash will go up. That’s my guess. I believe once the project is delivered, the company has to book the project as revenues. Since they are carrying them for a while, the margins will be better as well.
Do you think Ill ever make my money back here I got in when you first recommended it. Is there any hope or should I just write it off as a very bad trade. I recently bought some EFSF at .04 and in for a double so far things are looking much better for them. Do you not like the deal? I feel that with the new CEO things could get better very quickly.
Editor: I’m not sure what price level you are referring to, but I’m guessing around $3. Yes, I think you have a very good chance of making money from that level. I’m looking for $5 to $6 longer term. Nice trade on the EFSF- yes, I like the new deal, but I think it’s going to be a bumpy road for sometime.
Hi Larry,
Bought CGYV at 1.57 cost basis and sold half at 2 bucks.
Bought TBT at 39 and it is still running past 45.
Bought XLF at 9 and sold at 10.15.
Bought XLF back at 9.11 cost basis and it is near 10 bucks now and heading higher.
Thanks for the great ideas!
You recommended GLD, what about SLV for a silver trade?
Editor: I’m no expert on which commodity will trade the best. GLD is the one I would own because the macro forces, not supply and demand for consumption are going to push it up, and that’s the one everyone else wants to buy.
excellent dvd and commmentary
Editor: yes- there’s great content on the company. When the markets return to some semblance of normalcy, this one will be a big money maker for investors.