By Zack Buckley

On July 12, 2010, I attended the Global Hunter securities conference in San Francisco representing the GEO Team. Maj Soueidan, President of Geoinvesting.com, provided me with several questions covering topics of EPS growth, dilution risk and expansion goals. It was interesting to see so many companies present in such a rapid fire time frame. Even more interesting was being able to sit down with company management teams and discuss some of the issues and questions we had with individual companies.

China Green Material Tech (OTC BB:CAGM) manufactures and sells starch-based biodegradable, disposable containers, tableware and packaging materials.

Q - Why the recent raise?

A - China Green Mat had $13.4 million in cash at the end of Q1. That cash is largely earmarked for the capacity expansion occurring in the second half of the year, and for general working capital. The $2.8 million raise will be used for marketing and general working capital.

Q - When can we expect 30% EPS growth?

A - The Company has only provided revenue guidance: 25-30% growth in 2010. They have also said they expect to maintain strong gross margins in the mid to upper 40% range. Now that the new CFO has been appointed, he will assist management with planning and forecasting. They expect to provide earnings guidance in the future when the new CFO gets ramped up.

Q - Anymore raises in the near future?

A - No future raises planned. The capacity expansion will support anticipated growth through 2011.

China Armco Metals (NYSE AMEX:CNAM) began operating a scrap metal recycling facility this year and is also an iron ore distributor.

Q - How are earnings looking for the rest of the year.

A - 2nd quarter - no response; 3rd quarter - should be strong; 4th quarter - should be stronger than third quarter

I was able to talk with the CNAM representative after the conference on the first day, and he explained that CNAM would be changing several things with their company in the next year, including the auditors. He also pointed out to me that the only potential issues with the new scrap metal recycling factory is not the demand for the metal, but actually the supply of metal for the factory. I was worried that the demand would not be there for the factory, but he said demand is very high, so they are focusing on supplying scrap metal, which is more difficult.

Yongye Intl (NASDAQ:YONG) is a manufacturer and distributor of a fulvic acid plant nutrient.

Q - What will happen with operating cash flows going forward?

A - Management was not specific.

China Mediaexpress Holdin (NASDAQ:CCME) operates the television advertising network on inter-city express buses in China

Q - Why no acquisition yet?

A - There are a few which we announced previously. We acquired operating rights but not the entire companies.

Q - Will you need an acquisition to attain greater than 30% EPS growth?

A - No

Q - Would you consider buying back stock?

A - We will consider it.

Man Shing Agricultural (OTC BB:MSAH) is involved in the production, distribution, and sale of ginger.

Q - Will the weather ever be an issue during your growing season?

A - The weather should not be an issue and the fact that they only have one product also is not an issue. There are very few places in China that can grow ginger well, and Man Shing happens to have that land, so in that sense the company has a monopoly. Man Shing has been growing ginger there for a very long time, much longer than the company has been in existence, and there are very little weather problems.

Yuhe Intl (NASDAQ:YUII) is a supplier of day-old chickens raised for meat production.

Q - YUII Just filed a Shelf. We wanted to find out how they would allocate the funds?

A - The company is going to do some acquisitions to purchase breeder farms in cities outside Shandong Province. The management believes that by this means, Yuhe can duplicate its successful business model and expand its geographic presence.

Q - When will Yuhe do a raise?

A - Yuhe do not have a specific time line for the raise yet since the market condition is not very favorable. The company will provide updates once it decides to do a raise.

Harbin Electric (NASDAQ:HRBN) develops, manufactures, and supplies a range of electric motors.

Q - HRBN just Filed a shelf. What will they most likely use funds for?

A - As the Company becomes larger, it is prudent to have a longer term plan. In general, the capital needs will be in the areas of capital expenditure including capacity expansion, technology upgrade, as well as working capital, research and development and other general corporate purposes.

New Energy Systems Group (OTC BB:NEWN) manufactures components for batteries used in mobile phones and other digital devices.

Q -Are they seeing weakness in the international markets?

A - We are not as effected by international markets since most of our sales are in China. As we expand internationally, we see that as a largely untapped market, so it's really just a question of how fast we grow.

Q - Discuss currency risk?

A - We are not very concerned with currency risk.

Q - Guidance still intact?

A - Yes

Q - Would you consider buying back stock?

A - Regarding a buy-back, it is always a possibility, but something we have not commented on publicly.

The presentation for NEWN was interesting, they passed out portable iPhone and iPod chargers that work very well, I am still using mine.

Huifeng Bio-Pharma Tech (OTC BB:HFGB) develops and produces plant extracts and pharmaceutical raw materials for use in pharmaceutical, nutraceutical and food production.

Q - Does guidance include a raise assumption?

A - The company said it needs to raise capital for their Spanish project. The cost of getting listed in the US was higher than they anticipated.

Q - Will you make guidance and 30%+ EPS growth?

A - They reaffirmed their $0.22 guidance.

Soko Fitness & Spa (OTC BB:SOKF) is a leading operator of fitness clubs and spas in Northeast China.

Q - When will they make an acquisition?

A - Soon, not specified.

Q - Will short term EPS growth be challenging?

A - No, should maintain a healthy growth rate.

China Marine Food (NYSE AMEX:CMFO) was on of the most interesting presentations, given the recent short interest. I sat down with Marco Ku, CFO of CMFO to discuss the future prospects of the company. CMFO believes they will see 30% CAGR in their seafood business and 60% CAGR in their soft drink business over the next 5 years. In addition, they plan on building a cold storage facility which should have an approximately 5 year payback period, which will also generate an additional 4 million in annual net income.

In the breakout session for CMFO, we were able to see some of the marketing materials for the new Hi Power drink, as well as the actual can, which looks extremely similar to Coca Cola cans. In addition, we were able to try the seafood jerky, which was quite good.

Disclosure:

Profile

GeoTeam Contributor Zack Buckley is CEO of Uncoveringalpha.com and a research analyst at Geoinvesting.com. He developed his investing methodology by synthesizing the ideas from the best investors of all time, based on their track record. This led him to closely follow Warren Buffett, Peter Lynch, Seth Klarman and Benjamin Graham. Using a value approach, he pursued the most undervalued companies he could find, which led primarily to companies in China. Buckley will be spending three months this year in China visiting companies that are exciting investment opportunities.

****Follow him on his blog, Uncoveringalpha.com, as he travels across China touring factories and interviewing management.***