4. China-based ShangPharma (SHP) is engaged in pharmaceutical and biotechnology research and development outsourcing.
For full year 2010, the company expects net revenues to reach $89.6-$91.1 million, a 24%-26% year-over-year growth, while GAAP gross profit is expected to register a 24%-28% year-over-year growth rate. Gross margins are anticipated in the range of 34.4%-34.8%, compared to the 33.2% margin reported for 2009, backed by favorable service mix, improved labor cost control, prudent material use and improved operational efficiency.
During the past 12 months, the return-on-equity was 48.7%, surpassing competitors. Covance (CVD), Pharmaceutical Product Development (PPDI), Charles River Laboratories (CRL), ICON plc (ICLR) and WuXi PharmaTech (WX) have ROEs of 5.1%, 12.6%, 8.7%, 17.4% and 20.7%, respectively.
The stock is currently trading at a forward price-to-earnings multiple of 14.2. All the 6 analysts covering the stock recommend buying and estimate the stock to gain around 25% over the next 12 months with a consensus target price of $16.3.
Select the service that is right for you!COMPARE ALL SERVICES
- $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
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV