LiNiu Technology Group (NASDAQ:LINU) Signs Strategic Agreements

LiNiu Technology Group (NASDAQ:LINU)

LiNiu Technology Group (NASDAQ:LINU) experienced a surge in stock price in Friday’s trading session, following the launch of an electronic trading platform dedicated to the Chinese agricultural industry. Shares of the company more than doubled in value, after gaining 115% to end the week at $2.35 a share.

LiNiu Technology Group (NASDAQ:LINU)

LINU Stock Performance

Friday’s rally follows a sell-off wave that had plagued the stock and pushed it to multi-year lows. While the stock is up by more than 40% for the year, it is still down by more than 70% from the $4.20 a share mark that was recorded in June.

Renewed investor interest in the stock follows the signing of a strategic cooperation agreement with The Peoples Insurance Company of China Limited’s (PICC) Guangzhou branch. Pursuant to the agreement, the two are to work on the development of new insurance products tailored for local farmers and the greater agriculture industry.

Guangzhou LiNiu will also promote PICCs insurance products on its LiNiuYang trading platform as part of the agreement.

“We are pleased to be working closely with PICC to help further enhance our presence in Guangdong province while devising new products in concert with PICC that should provide additional benefits to customers of our LiNiuYang platform,” said Mr. Wang Shun Yang, co-Chief Executive Officer of LiNiu Technology Group.

SGALP Collaboration

The PICC agreement builds on a strategic cooperation agreement that LiNiu Technology Group (NASDAQ:LINU) signed with Shou Guang Agriculture Logistic Park. (SGALP). Under the terms of the agreement, the two companies are to co-operate on product offerings, information resources, and consumer management.

LiNiu Technology Group (NASDAQ:LINU) expects the collaboration to increase its annual trading amount. Guangzhou LiNiu, on the other hand, is to earn additional commission income through an increase in daily traffic on its platform.

“We are pleased to embark on our new relationship with SGALP, which we believe will be a key strategic alliance that should provide a significant boost to our LiNiuYang platform, while allowing us to further utilize our technological capabilities to the benefit of SGALP,” said Mr. Wang Shun Yang, co-Chief Executive Officer of LiNiu Technology Group (NASDAQ:LINU).

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.

LiNiu Technology Group (NASDAQ:LINU) Explodes After Setting Eyes On Chinese Agricultural Industry

LiNiu Technology Group (NASDAQ:LINU)

LiNiu Technology Group (NASDAQ:LINU) says it has taken the necessary steps to streamline its operations after having experienced a tough 2016. The provider of agricultural products and services says it is working on a transformation plan that will allow it to play a key role in the Chinese agricultural industry. The moves follow the company seeing its full year revenue for 2016 drop by more than 50%.

Earnings Miss

Revenue for 12 months ending December 31, 2016, totaled $32.4 million representing a 69% drop from FY2015 revenues. The company has attributed the decrease to lower Rolling Chip Turnover in its VIP gaming rooms. China’s anti-corruption campaign also appears to have substantially affected the company’s revenue sources.

LiNiu Technology Group (NASDAQ:LINU) saw its bad debt portfolio soar to highs of $100.4 million primarily due to a one-time $97.3 million impairment of intangible assets. Lower commission to junket agents and a decline in selling, general, and administrative expenses did little to offset the loss on bad debts.

The massive impairment charge plunged LiNiu Technology into a net loss of (-$215) million or (-$3.41) a share, compared to a net income of $5.1 million generated in 2015. During the year the company was also forced to close four VIP gaming rooms. The company also terminated its gaming representative agreement with Kings Gaming Promotion Ltd.

2017 Highlights

Amidst the disappointments of 2016, LiNiu Technology Group (NASDAQ:LINU) is already exploring ways of reinvigorating its growth prospects with the acquisition of 51% stake in Guangzhou LiNiu Network Technology Co (LiNiu Network).

“We were pleased with the launch of the LiNiu Network earlier this month, and believe that the platform is well-positioned to more efficiently bring farmers and agricultural suppliers together to conduct business as well as provide education, medical, insurance, financing and other services to farmers,” said the chief executive officer, Wang Shun Yang.

LiNiu Technology Group (NASDAQ:LINU) has already launched an electronic business-to-consumer and consumer-to-consumer trading platform as it continues to flex its muscles in the Chinese agricultural industry. Dubbed the LiNiu network the platform has already attracted over 130,000 users with average daily traffic of 50,000 visitors. The platform boasts of over 20,000 suppliers with over 80,000 products on sale.

LiNiu Technology Group (NASDAQ:LINU) was one of the biggest gainers in Tuesday trading session. The stock was up 109.52% consequently ending the day at $0.440 a share.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

About the author: James Marion is a University of Houston student studying Business with a concentration in Finance.