Tianli Agritech (NASDAQ:OINK)

The GeoTeam® has been accumulating OINK since its precipitous fall from its IPO price of $6.00 to eventually trade as low as $3.60. On October 5, 2010 we issued a short-term trade alert. Aided by a small float, a delayed reaction to its second quarter strong earnings and a unique make good arrangement that is very shareholder friendly, we think the stock could at the very least reach its IPO price, just as China New Borun Adr (NYSE:BORN) did after it traded below its IPO price of $7.00 for several weeks.

OINK has rebounded from its lows on the heels of Zhongpin (NASDAQ:HOGS) recent impressive price move from around $11.00 per share in early June to above $19.00 as of October 8, 2010.  This is a stock we have also been trading.

Can OINK trade past $6.00? We are not ready to make that definitive call at this time. According to its 2010 EPS make good target of $0.74 ($0.56 tax adjusted), the company will report EPS of $0.27 ($0.20 tax adjusted) for the back half of 2010 vs. $0.31 ($0.23 tax adjusted) for the 2009 comparable period. Keep in mind that make goods are often conservative. If the company could pull a more impressive EPS growth rate in the last half of 2010, we think there is a chance that the stock could eclipse $8.00. We plan to methodically sell shares if they rise.

Please note:

• OINK's SAIC files do not match SEC files. However, OINK is a variable interest entity (VIE).
• OINK does not retain a top auditor. (Sherb & Co).
• We don't consider OINK's underwriter as a top tier firm.

We have asked GeoInvesting Contributor Dan France to take a look at the OINK story and provide us with his feedback.

Tianli Agritech Announces Pricing of Initial Public Offering

"OINK" To Trade on Nasdaq Global Market

Wuhan City, China – July 14, 2010 – Tianli Agritech, Inc.(Nasdaq: OINK), a leading hog breeding company headquartered in Wuhan, China, announced today the pricing of its initial public offering of a minimum of 1,667,000 and a maximum of 2,000,000 common shares at $6.00 per share.

Tianli Agritech expects its common shares to begin trading on the Nasdaq Global Market on Tuesday, July 20, 2010 under the ticker symbol "OINK." The CUSIP for the issue is G8883T 104.

All of the shares to be issued in the offering are being sold by Tianli Agritech, Inc.

Anderson & Strudwick, Inc. is acting as the lead placement agent for the offering.