China Finance Online (JRJC) Stock Hits New One-Year High

NEW YORK (TheStreet) -- China Finance Online  (JRJC) hit a new 52-week high of $10.38 on Thursday on higher-than-average volume.

The company announced Monday it had debuted China's first independent web-based securities trading platform called "Zhengquantong" or "Securities Master." China Finance Online launched the platform on its financial portals www.jrj.com and www.stockstar.com. Securities Master is part of the financial services company's new partnership with CITIC, China's largest brokerage firm.

The stock was up 12.87% to $10.35 at 11:18 a.m. More than 10.4 million shares had changed hands, compared to the average volume of 1,307,350.

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Separately, TheStreet Ratings team rates CHINA FINANCE ONLINE CO -ADR as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate CHINA FINANCE ONLINE CO -ADR (JRJC) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, we find that the company's return on equity has been disappointing."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • JRJC's very impressive revenue growth greatly exceeded the industry average of 19.9%. Since the same quarter one year prior, revenues leaped by 321.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • JRJC has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, JRJC has a quick ratio of 1.77, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for CHINA FINANCE ONLINE CO -ADR is currently very high, coming in at 76.75%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of -8.56% is in-line with the industry average.
  • CHINA FINANCE ONLINE CO -ADR reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. During the past fiscal year, CHINA FINANCE ONLINE CO -ADR continued to lose money by earning -$0.41 versus -$0.54 in the prior year.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Internet Software & Services industry and the overall market, CHINA FINANCE ONLINE CO -ADR's return on equity significantly trails that of both the industry average and the S&P 500.
  • You can view the full analysis from the report here: JRJC Ratings Report

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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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