More news on TFN Grapevine pick Quepasa.com (QPSA)
Today's Financial News - Posted August 24, 2009
Quepasa.com (OTC:QPSA) is up over 100% since we first posted our TFN Reader Grapevine pick on TFN’s home page. Is is still a good play?
by J. Christoph Amberger
Baltimore, MD — TFN: TFN Reader Grapevine Maven Charles D. filed this with us:
“Quepasa.com (OTC:QPSA) has done very nicely since you refered it to your readers. The stock closed at $1.50 on Friday on ‘no news’. But remember, we expect big news coming. We bought this in the $0.60 – $0.75 range (personally, I got in at $0.62 and bought more at $0.74). Nice 100% gain in about 60 days or so.
“I remain convinced it’s going to $4 plus by year-end and I truly believe this one is going to become a ‘ten-bagger’. Just too many things add up to a winner: There are 2 billionaires actively involved. (Rick Scott and Alonzo). They have bought stock as per recent filings. Alonzo is Matt Inc., his non-profit group. They have a new CEO, they have reduced burn down from a $1mill a month. They have partnerships with Playboy, Dr Rey, the Battles of America etc, and these are just the beginning.
“I know they are adding 500,0000 to 750,000 members a month. Although a few more deals and some Investor Relations will would really help. So far, they have zero investor relations support for the current move. The recent delisting really provided a great opportunity to pick up shares of this outstanding company as it created forced sellers, some retail but a lot of institutional selling for institutions that could not own a de-listed company. It appears that all the short term sellers are gone.
“The delisting was only done because the company didn’t want to raise the equity amount needed to stay listed. Why dilute themselves just to keep the NASDAQ Listing? They made a good choice for investors at that point, but it was viewed like the company was going out of business. It’s not!
“There are only 12 million shares outstanding. With just 15 million users of www.Quepasa.com, it suggests they are trading at $1 a member. The Russian investor who just invested in Facebook (a private play) did it at $40 a member. I would think a leading Spanish-speaking social network company would sell at a minimum of 25% to 50% in a comp or $10 to $20 a member, after hitting 20 million members. That’s equates to a $200 mill. to $400 mill. possible market valuation or $16 to $32 a share. So I don’t see why we couldn’t go substantially higher than $1.40.”
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