Tuesday, June 30, 2009

Update on SKBI (previously SKBO.OB)

I alerted about SKBI (SKBO.OB until last Friday) on 06/08 when it was trading at $14, read it. As the company announced earlier, it moved from OTC exchange to NASDAQ last Friday, 06/26 and closed at $20 after hitting the intraday/52 week high of $22, which was like 55% above its recommended price. SKBI just released the news saying it is offering the public with 1.4 million shares at $12.98, which will be used for completion of a new vaccine facility; the construction of a new production facility for micro-organisms and feed additives; acquisitions of other companies in the veterinary healthcare industry; and working capital and general corporate purposes, including research and development and marketing. Read it here

New Analysis - Take a look at their recent S1 for more information on how many shares are with the management and how many are locked for 6 months. Based on that the new float should be around 1.5 million and outstanding shares should be around 2.5 million (Please correct me if I am wrong). Coming to EPS...As per their recent presentation they earned $3.07 on outstanding shares, which is $6.7 million net adjusted income (excluding non-recurring expenses). If you divide the net income with the newly diluted shares you get the earnings of $2.75 so based on the recent growth history, I do not think they need to sweat for the same amount of growth in the coming quarters and I think they can easily exceed market expectations of $3.50 plus EPS.

Bottomline - Based on today's news, SKBI's stock price could tank tomorrow and how much is it going tank is anyone's guess. But I consider the dip as a buying opportunity. I hope some of you already took some profits off the table (If not then its not my fault!). If you have not traded this stock in the past, I would like you to add it to your watchlist and take small position when it dips.

Disclosure - I neither long nor short SKBO.OB or SKBI

A general Caution and Advise-As I always advise in my posts, Do not chase stocks. please keep in mind that I am not a Stock Market Analyst or an Investment Adviser to count on my recommendations/alerts. As always please do your DD before investing or speculating, start with a small position, always keep your stop losses in place and emotions out. Finally thank me for your profits but do not blame me for your losses because you are the one who pulled the trigger!!!

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Who is Mr.Incredible?

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Mr.Incredible is a Momentum/Technical Breakout player who trades small/micro cap plays and who saw a 600% Growth since 2006, Yes even in this down market. I am going to post my real trades (including profits/losses) soon...As a general caution and advice Please start with a small position and always keep your stop losses in place just in case....As usual Do your DD before investing. Thank me for your profits and don't blame me for your losses because you are the one who pulled the trigger!!!