QIN - Quintis Limited

[Rainmaker2000]

That's what's so great about investing........it's successful 'intuition' that will make you exceptional returns..........

Does the large director sell mean anything.......maybe, maybe not

What does a large contract for a product which you will harvest in the future mean much?........maybe, maybe not

Is a move away from MIS significant, or not?........personally I've always thought MIS was an ingenious tax innovation.....

I don't even get to the 'using intuition' stage on a stock like this or thinking about questions like this......until it demonstrates cash flows with some reasoning in relation to reported profit.........I could never think of investing in it......

It's always fund to be a spectator though....one learns a lot

 

[smalldiamond]

Hi Rainmaker....I wouldn't be a spectator on this one.

Your are correct most news / information are just indicators...tea leaves...but the summary is all positive. Cashflow and profit on the other hand are real and present right now (you cant hide this)! The Director sale is confusing, but as noted Director sales are not always related to a negative event. Sometimes Directors need to diversify, have other interests etc. They also sometime like to reward themselves given they often get shares issued at a discount. I however get concerned when there are a number of Directors selling. This isn't the case. This Director still owns > 2 million shares (he is a small shareholder Director).

Movement away from MIS....well at the end of the day if you consider the IRR for a plantation investor on its own merrits...the investment makes sense full stop with or without tax incentives (a bit more cream)! Tax incentives just happen to a bonus. Wholesale investors aren't entering the arena for tax advantages!

Rainmaker...get your accountant / advisor to do the cash flow analysis for you..... Don't discount the opportunity because you don't understand the model.

All I am saying is, its great to be a sceptic and a spectator.....but in a couple of years I don't want you to be in the position of knowing you had the opportunity to invest but never understood what you were looking at....I personally would be very annoyed. Having been investing since 1996 I have never come across such a great opportunity.

Do the challenge at get someone to professionally advise you on the cash flow of this company / health of the company. You will probably find your advisor will buy the shares.....my account did and he can't believe the market is so stupid!

This share WILL give you exceptional returns! Its just a tming issue!
Like TFS said ..."they are caught up in the MIS mess...but their business model is poles apart"

SD

 

[prawn_86]

SD,

Why should anyone that already invests personally and doesnt understand the model get someone else to try and understand it for them? That just adds another layer of complication.

One of the golden rules of my investing is that if you dont understand it, dont invest. Saved me from many bad stocks (ABC, Allco, BNB etc etc). Thats not to say you cant make money, but its a hassle i would rather not bother with personally.

 

[Rainmaker2000]

I agree Prawn

That's the interesting issue, isn't it........I have already got the qualifications and experience to understand their model.........I don't really like to call myself an 'expert' at anything......and I do 'understand' their model......what I'm saying is that 'there is not enough in the financials for me to verify the 'profits'.......that does not mean TFS will not be a good investment at some price

As for being sad at the one that got away........that's not going to happen.....it does not work like that

As Benjamin Graham said something like 'investing is done best when it's most business like'.......

I already have a few stocks that have appreciated several hundred percent this year......I'm just focusing on my method and leaving the emotional stuff for my private life

 

[smalldiamond]

Hi Raimaker,

Thought you may be interested in the following by Criterion from earlier this year (pre June results):

REFLECTING on Timbercorp's demise, we're struck by the similarities between the managed investment game and a Ponzi scheme. After all, both rely on a flow of new subscriptions to maintain the caper.

MIS agri-schemes lure investors (or "growers") with a tax deduction and the promises of an eventual commercial return on the produce. Given the long lead time to harvest, it takes years before the rosy prospectus projections can be proved.

Given that Ponzi schemes are illegal and MISes aren't, we won't stretch the comparison any further. Suffice to say Timbercorp became unstuck by dwindling subscriptions, high debt and poor returns from projects such as grapes and hothouse tomatoes.

Criterion doesn't believe in guilt by association, which bring us to TFS and its lure of $US2000 per kilogram returns from its Indian sandalwood acreages in northern WA.

Widely used in perfumes and other applications including Hindu ceremonies, Indian sandalwood is in short supply. TFS has 840ha under cultivation and hopes to harvest its first tree in 2011-12.

Ord Minnett analyst Martyn Jacobs says the exit of MIS operators makes it easier for TFS to achieve its current year target of $61 million in sales. "Their establishment fee is more than enough to buy land, fund the operation and have a healthy profit margin," he says. "They don't need to sell next year's project to fund this year's expenses and don't need to raise debt to fund the project."

Ord Minnett forecasts a $44.7million net profit this year (earnings per share of 23.8c), while Foresight Securities expects $31.6 million (16.7c). Unlike Timbercorp, TFS has supported capex from its existing subscriptions, rather than relying on new ones or on debt.

"MIS operations are highly capital intensive given the up-front land purchase requirement before planting," says Foresight Securities analyst Adam Michell. TFS, however, has enough land to meet expected growth over the next four years.

Ultimately, TFS will succeed on its ability to achieve a steady harvest. A parasite requiring a host tree, Indian sandalwood is hard to grow- buy.

 

[Rainmaker2000]

How many of these do you own Smalldiamond? You seem pretty committed

Although Criterion may accidently get a stock call right once and a while does not mean that Criterion is not among the worst stock tips around.....these stock tips are given out for free on the news dot com website

The beauty of Criterion is that thankfully no one, including the columnist, is forced to put any money on these recommendations.

I actually agree with Criterion that TFS may be building a lucrative business.....I also agree with Criterion that I can't find any evidence on the balance sheet and cash flows of this fact......None is cited by Criterion.

Your red highlight seems to emphasise no need for debt......Well, why would a company need debt when it continually writes so much equity....I note the company is not debt free also

Which brings me back to my first point: any company that continually writes shares makes it almost impossible to project what earnings per share one will get from one's investment today.........it's just diluted and diluted right through the rainbow

That is not investing to me or to some of the stockmarket classics

 

[smalldiamond]

Hi Rainmaker.

Yes very committed...

I think we will just leave it there...I have run out of energy trying to explain debt / equity / difference in timing between MIS income coming into toward end June and capital expenditure at other times of the year e.g. growing the business - such as buying Mt Romance, land etc etc. Supporting grower debt / selling grower debt, re establishing grower debt in difficult market GFS. Getting the business bullet proof for this year's MIS / fund interest and more business growth development.

That it for me.....won't be back chatting here I'm afraid....

All the best and one last before I go 'do look hard into TFS'.... IMO you will be smiling...but if 't own the shares...well there is always the one that got away. And 'if by chance TFC doesnt ome to be be....well then you will hear a 'bugger' uttered in the ditance!

Oh I may come back in a year or so...just to check in ;-)

:cool
:SD

 

[notting]

TFC

Performing a little softly given allot is about to start happening for this one

 

[oldblue]

Re: TFC

Performing a little softly given allot is about to start happening for this one

OK, I'll bite.

What is "about to start happening with this one" or is that just an attempt to start some discussion?

I've followed TFC, at a distance, for some time now so have more than just an idle interest in their prospects.

 

[Tyler]

Re: TFC

Bought in at .84 sold at .9 due to the raising of the debt & cashflow concerns (it has now taken on waaaay too much debt) also would you not rather be the debt holder
11% interest & options at 1.30, so you get your 11% every year & if it does turn out to be a success you get upside in share price (if the business survives)

 

[notting]

Their operators used to say 'bring on 2012 when we start it all up.'
Seemed like a great idea.
Nobody loves me at .52!

 

[skc]

Their operators used to say 'bring on 2012 when we start it all up.'
Seemed like a great idea.
Nobody loves me at .52!

Pretty hard to find another sector like forestry that has a higher proportion of dogs.

May be fisheries or uranium.

 

[notting]

Yeah but it's almost not forestry even though it requires land and trees.
Pure sandalwood is great stuff and is loved in the east and Middle East and is valued highly as well.
I’ve bought and sold it a few times and lost interest owning it when they started carving off peaces to major share holders and leaving retail holders with less, but still am keeping a lazy eye on it.
It could be a goer once it is producing reasonable volumes.

 

[RBgO]

anybody still here?

 

[So_Cynical]

anybody still here?

I'm still here....waiting for this mob to fall over.

 

[burglar]

anybody still here?

We are here most nights.

 

[RBgO]

I'm still here....waiting for this mob to fall over.

Why "this mob"?

 

[So_Cynical]

Why "this mob"?

RBgO "this mob" are in the tree growing business, the same business that the following mobs were in.

• TIM - Timbercorp (In Liquidation/Administration)
• GPL - Great Southern (In Liquidation/Administration)
• WFL - Willmott Forests (In Liquidation/Administration)
• ARK - Ark Fund (Rewards Group) (In Liquidation/Administration)
• FEA - Forest Enterprises (In Liquidation/Administration)
• ELD - Elders (Now Trading at 23 CPS but were $14 in 2008)
• GNS - Gunns (Last Traded at 16 CPS currently in suspension and have been since March)

Get the picture? Do you see where im going with this?

 

[oldblue]

Fair comment, F-C. Not great company for TFC to be keeping!

It's a long time since I looked seriously at them but it could be argued there are several important points of difference between TFC and the companies that you mention eg TFC's admittedly slender profitability; a producer of valuable sandalwood; owner of a sandalwood oil processor; less dependence on tax-driven sales.

Not one that appeals to me but I wouldn't write them off at this stage.

 

[Junior]

Fair comment, F-C. Not great company for TFC to be keeping!

It's a long time since I looked seriously at them but it could be argued there are several important points of difference between TFC and the companies that you mention eg TFC's admittedly slender profitability; a producer of valuable sandalwood; owner of a sandalwood oil processor; less dependence on tax-driven sales.

Not one that appeals to me but I wouldn't write them off at this stage.

Without looking at the research....if they've lasted this long maybe they'll surivive. Those other groups all fell in quick succession. Once the big ones (great southern and timbercorp) went down banks withdrew funding from the lot. What are TFS debt levels like? Where did their revenue come from last year? MIS sales are dead so they must have other sources of revenue.