Wednesday, December 30, 2009

Bookkeeping: Beginning Starter Stake in Telestone Technologies (TSTC)

I keep waiting for some meaningful correction in Telestone Technologies (TSTC) and it just is not happening.  Each time the stock hits any sort of support, it immediately rockets up - and I grind my teeth watching it.  Therefore, with the drop the past 2 sessions, including nearly 5% today I am going to begin a starter stake of 0.9% exposure in the $19.70s to at least have some skin in the game.  Much like some other issues I have added of late I am hoping it falls so I can add more at cheaper prices, hence I would not mind losing money on this first tranche.  The 10 day moving average is just under $19 (rising quickly) and the 20 day is $17.50 - I'll likely add at both levels if the opportunity is offered.

My computer is acting up with charts - but I will add the chart later in the day.  If things were working I'd be showing you a 2 month chart where the stock has not even penetrated below the 10 day moving average since early November here.

EDIT - chart loaded

Now if I were a less transparent fund you would see TSTC listed in my quarter end/year end holdings in a few months and say "that Mark! What a genius!  Great pick!" as I, like many other mutual fund managers, would be adding great performing stocks to my portfolio in the closing days of the year to showcase my "skillz".  But since investors are going to have a very good idea of what I am doing within weeks of when I do it, I can't play the "window dressing" game.  Therefore here I am buying it with 1 session left in the year, for reasons clearly stated above ;)

We discussed this company a few weeks ago, and since then I've looked at it more and feel comfortable with the company and it's main issue (massive DSO).  This is far and away the smallest stock we own at a $200M market capitalization.

Telestone provides Local Access Network Solutions, products and engineering integration to telecom carriers. In terms of 2G technologies, Telestone is a main supplier in wireless access coverage infrastructure building for the GSM and CDMA network base on its RFPA technologies primarily in the PRC. The products; repeaters, line-amplifiers, antennas and radio accessories are all based on RFPA technologies.

After intensive research on the demands of carriers in 3G technologies, based on its strong R&D capabilities in both wireless and Fiber-Optics, Telestone has invented its WFDS unification local access network solution and products which are highly welcomed by all telecom carriers and property owners. Telestone also provides services that include project design, project manufacturing, installation, maintenance and after-sales services. Telestone currently has approximately 1,200 employees.

Long Telestone Technologies in fund; no personal position

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