SA Article: Why I Bought This Small-Cap Coal Compa
L&L Energy, Inc. is a $67MM market cap stock trading on the NASDAQ under the ticker LLEN. It is a U.S. based coal holdings company with all of its operations in China. I was looking through screens on high ROE (+10%), low PE (<10) low P/FCF (<5), and as a result, I came across LLEN which at the moment has several of the characteristics I find appealing when window shopping. This doesn't mean I buy something on looks alone, only as a means to find stocks to research.
Looking through the last 10 years of L&L Energy's financial reports, I found the volatility that raised prices then slammed the stock down to today's levels to be legitimate. However, current reports and developments should have been driving this stock up, but have failed to do so. Let me brief you on key developments over the past couple of years.
The optimism surrounding the company when revenues soared both in FY 2010 and then again in FY 2011, coupled with net profit rising at similar levels, lead to lofty expectations. This can explain why the stock could get listed on the NASDAQ, have it shares rise to $8-14/share, and have growth projections of 10+% YoY (see table below).
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https://seekingalpha.com/article/1266021-l-l-energy-why-i-bought-this-small-cap-coal-company?source=yahoo