Checking Up on Chinese Small-Caps
BEIJING (TheStreet) -- The Rodman & Renshaw conference comes to Beijing next week and I'm eagerly awaiting the opportunity to meet with some of the small-cap China companies I follow. Many of the stocks have come off by 30% to 40% or more since mid-January so it's a great time to check in with management teams to get an idea if there are any good buying opportunities.
The conference lineup is impressive with more than 100 companies listed on the Rodman & Renshaw Web site
I'm eager to see China Agritech (CAGC) which uplisted last September at a $6 (adjusted for a 2-for-1 stock split) and now trades at more than $25.
Every time I want to get into the stock I hesitate , it then rockets up again, and I end up kicking myself for not getting in. So now is a good time to see if $25 is still a good entry point or if it's too late. Chine Agritech is scheduled to make a presentation at the conference on Tuesday.While China Agritech is up 80% year to date, its direct competitor China Green Agriculture (CGA) is basically flat for the year. China Green Agriculture boasts net margins of more than 30% and had more than $60 million of cash at year end with no long-term debt. China Green Agriculture presents on Monday, so the real question I might be asking is "why buy Agritech" if I'm too late to the party and when CGA still looks very cheap at $15. My biggest focus will be on Duoyuan Printing (DYP). The company priced its initial public offering on the New York Stock Exchange last year at $8, the low end of the range, and has traded up about 20% to 30% since then. But it still looks very cheap. The company is run by Chairman Wenhua Guo, who is also chairman of NYSE-listed Duoyuan Global Water (DGW). Both companies have gross margins of around 50% and net margins of 25% to 30%, but DYP trades at a massive discount to DGW. Because the companies have the same management, a similar financial profile and double-digit growth rates, I think DYP is a bargain which has about 50% upside to it. Piper Jaffray just reiterated its outperform rating on DYP with a $13 target vs. a current price just over $9.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV