I call bullsh*t on the fact that DTSS stock is up 160%+ on news it received a contract “in China”. Here is the press release.
Datasea has entered into an agreement with Beijing Tengyuejunjie Parking Management to install its proprietary and Control System in Nantaipingzhuang Beixiang, a residential community in the Chaoyang District of Beijing. The total value of this engagement over the three-year term of this engagement is RMB [55,000] or approximately $[7,800]; this engagement will be the first-of-its-kind arrangement for the Company in Beijing. Datasea’s proprietary system was developed specifically to monitor potential public healthcare threats within schools and public communities. The system facilitates contactless body temperature measurement and uses artificial intelligence-based face recognition technology, automatically identifying individuals at the community’s ingress and egress access points, thus allowing BTPM to monitor activity and receive real-time feedback in that community. Under the terms of this arrangement, Datasea will provide the hardware, software, and the installation services to Nantaipingzhuang Beixiang, a community with more than 1,200 homes and 4,000 residents.
First off, do you see the hype? Datasea IS A CHINA COMPANY. The company has an American sounding name, and the press release cleverly says “first contract in Beijing” but since western media often refers to China as “Beijing” the implicit knee jerk reaction is that this company has gotten its first contract in China.
The second point is that about 40% of all cases of coronavirus are asymptomatic. Another 10% or so never has the symptom of a temperature increase. So maybe this device will detect about half the people with coronavirus in a school. That’s far short of what is needed to stop an outbreak in a school.
What is going on here is a Chinese company, getting a supposed big contract in Beijing, and then releasing a press release in english to an American audience to suck in more U.S. dollars into the company. This company could have gotten the contract in Beijing as a ruse to suck in more U.S. investors into the company with fantasy ideas like this could be used at every school in America. Folks, I want you to view all Chinese stocks with a healthy dose of skepticism going forward.