Monday, March 26, 2007

Quick Update and Ramen

Increased the Amgen (AMGN) position by a third at 57.50. With this latest purchase, Amgen now sits right in the middle at #12 out of 23 total stocks in the Long-Term Port.

Okay, Ramen... So, there's a small/micro-cap Chinese company called New Dragon Asia (NWD). NWD, currently trading at 1.47, has a market cap of $80MM with roughly 65% of its shares owned by their chairman, Hen Jing Lu. The company has 3 main product lines: flour products (60%), instant noodles (30%), and soybean products (10%). After taking a quick look, the main thing that jumps out as a red flag would be an incredibly large stock option grant of 8MM shares to their CFO. And, what's strange is he's getting a salary of $180K vs $20K salary for their CEO. I've no idea what that's all about.

Aside from the compensation weirdness, maybe the company is worth a look. Their business does seem to be growing, and their margins are decent (gross around 19%, and operating at around 11%). Definitely a risky stock, but I might take a small bite at some point. I'll look into it more soon.

If anyone does take some time to look at it, I'd love to hear about why this would be a horrible investment or any other things to keep a watchful eye on.

No comments: