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Wednesday, November 16, 2005

HQSM Q3 results

HQSM released their Q3 results with no balance sheet or cash flow. Here's Q2 for comparison. 10-K post, overview post.

Revenues are up nicely. Selling and distribution costs continued to drop. They finally put some provision for doubtful accounts! $197K. Profits are good, even with the provision added. They earned 1 cent, about the same as Q3 last year if you take away last year's exceptional gain on recovery. It's also about the same as Q2. Share count is about what I expected. Nothing really happened with the stock after the announcement at about 1:00 PM today. The bid and ask are 45 and 46 cents. Conclusion: I still believe it's worth about 50 cents.

Unrelated: here's a 175 year old tortoise, born in 1830, just 4 years after Thomas Jefferson died.

Comments:
have been enjoying reading the site, think you're doing interesting work. i was curious as to what your professional background was and how you
developed your approach - ed
 
My professional background is electrical engineer, mostly in data communications product development (doing software). My approach developed over a long time period of watching businesses and organizations, successful teams and unsuccessful teams. I've been lucky to have worked with so many truly amazing people over such a long time period.

If you look at my reading list, you'll see most of the theory that influenced my views on investment. There are a lot of marketing and management books that I left off.

In my opinion, theory without persistent dilligent practice doesn't do much good. And hard work without knowledge and curiousity doesn't do much good, either.
 
I have enjoyed reading your research/site as well. I understand your background through the excellent books you have listed.

My question is where are you pulling these stocks from. Are you just going through the pink sheets one by one or doing some type of screening? If you do not want to disclose your methodolgy I understand.

Thanks for your thoughts.
 
I've outsourced to some Cantonese laborers who toil endlessly searching the pink sheets and OTC BB for stocks that meet certain criteria. Fortunately, they speak English and are reasonably well educated. On rare occasions I've made the trek to visit them, much of it must be traveled on foot. Due to a natural financial limitations, they actually share a single computer and work in shifts. People say bad things about child labor, but in this case, it helps pay for the particular child's education where he must travel over 3 miles to get to school with no available public transportation. It's a harsh life, but I'm glad that I'm helping them out, even if the wages are low by our standards.

[NOTE: The above, while being strictly true, might be a bit misleading],
 
I'll take that as you don't want to disclose. Although it was humorous. Keep up the good work.
 
"I'll take that as you don't want to disclose. Although it was humorous."

It was humorous, but the only part that's really not true is that they actually aren't toiling endlessly.

The truth is that we're going through 7,000+ stocks using brute force and surprisingly little automation.
 
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