Ticonderoga Maintains a 'Buy' on Cogo Group (COGO); Planning to Move to the Cayman Islands and Eying a HKSE Listing
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Price: $2.39 --0%
Rating Summary:
1 Buy, 2 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
1 Buy, 2 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Ticonderoga maintains a 'Buy' on Cogo Group (NASDAQ: COGO), PT $14.25.
Ticonderoga analyst says, "Late this afternoon, Cogo announced that its Board of Directors approved a change in the company's domicile from Maryland to the Cayman Islands. Cogo still requires approval from shareholders to make this change and will become a foreign private issuer. The key takeaway is that we believe Cogo is frustrated with its stock price performance and is searching for ways to expand its valuation level from the current 6.7x CY11 P/E (ex-cash); however, we are not sure the company's valuation will expand much and there could be fallout from existing U.S investors."
"If Cogo is able to domicile in the Cayman Islands, this opens up the opportunity for the company to dual-list its shares in the U.S. and on the Hong Kong Stock Exchange. Essentially, Cogo estimates it could dual-list on the Hong Kong Stock Exchange within 3-6 months after a successful re-domestication."
"Cogo believes that a move to the Cayman Islands will expand its investor base by making the shares more attractive to non-U.S. investors. This may be the case; however, there are likely to be U.S. investors who will no longer be able to hold the shares. Netting this out, the change could be an incremental positive in the long-term, but this is difficult to quantify."
For more ratings news on Cogo Group click here and for the rating history of Cogo Group click here.
Shares of Cogo Group closed at $8.21 yesterday.
Ticonderoga analyst says, "Late this afternoon, Cogo announced that its Board of Directors approved a change in the company's domicile from Maryland to the Cayman Islands. Cogo still requires approval from shareholders to make this change and will become a foreign private issuer. The key takeaway is that we believe Cogo is frustrated with its stock price performance and is searching for ways to expand its valuation level from the current 6.7x CY11 P/E (ex-cash); however, we are not sure the company's valuation will expand much and there could be fallout from existing U.S investors."
"If Cogo is able to domicile in the Cayman Islands, this opens up the opportunity for the company to dual-list its shares in the U.S. and on the Hong Kong Stock Exchange. Essentially, Cogo estimates it could dual-list on the Hong Kong Stock Exchange within 3-6 months after a successful re-domestication."
"Cogo believes that a move to the Cayman Islands will expand its investor base by making the shares more attractive to non-U.S. investors. This may be the case; however, there are likely to be U.S. investors who will no longer be able to hold the shares. Netting this out, the change could be an incremental positive in the long-term, but this is difficult to quantify."
For more ratings news on Cogo Group click here and for the rating history of Cogo Group click here.
Shares of Cogo Group closed at $8.21 yesterday.
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