NEW YORK ( TheStreet) -- China-based Sorl Auto Parts (SORL) stock has fallen 5.8% to $9.30 late afternoon as investors engaged in increased profit taking after the company announced a successful fourth quarter that blew past Wall Street consensus estimates.
Rodman & Renshaw analyst Amit Dayal attributes the stock price fall to profit taking.
"If you look at the volumes over last five days leading up to earnings," they were much higher, Dayal said. On Mar. 29, more than a million shares of Sorl had traded hands, compared with its three-month average volume of about 273,000.
Sorl Auto shot up 5.6% to $10.20 on the day that it reported a spike in its fourth-quarter profit.Sorl's stock-price drop Thursday isn't much of a concern for Dayal, who said that "fundamentally I'm not really concerned," about the stock. "I would use this as a buying opportunity. It is one of the better component names." Following Sorl's earnings report, Dayal reiterated his market outperform recommendation for the stock and was raising the price target for Sorl from $14 to $18. On Mar. 29, Sorl posted net income of $5 million, or 28 cents a share, for the quarter ended Dec. 31. That was nearly triple the $1.8 million, or 10 cents a share, the company earned a year earlier and above the 18 cents a share estimate derived from a Thomson Reuters poll of analysts. -- Reported by Andrea Tse in New York
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