China Medical is a cheap stock with lots of upside. The company is keeping up its end of the bargain by routinely exceeding analyst views. CMED has posted an average surprise of 19.1% over the past four quarters. During the last month, this year's earnings estimates have increased six cents to $1.58 per share. Analysts expect a further 47% jump to $2.31 next year.
Full Analysis
China Medical Technologies, Inc. (CMED) develops, manufactures, and markets medical devices for the treatment of solid cancers and benign tumors in the People's Republic of China. It offers In-vitro diagnostics systems, which include enhanced chemiluminescence immunoassay (ECLIA) system and fluorescent in situ hybridization (FISH) imaging analysis system and probes.
The company's ECLIA system consists of ECLIA analyzer for detecting minute levels of light triggered by combining reagents with body fluid samples to produce diagnostic results; reagent kits, which are formulated to create various reactions with blood or other body fluid samples; and a data analysis system to analyze and organize the information produced form diagnostic results.
In late-February, the company reported strong fiscal second-quarter earnings. The Company reported net revenues of RMB265.1 million (US$36.3 million) for 3Q FY2007, representing a 64.2% increase from the corresponding period of FY2006. Earnings came in at 48 cents per share, 6.7% ahead of estimates.
"We are pleased to report another strong quarter," commented Mr. Xiaodong Wu, Chairman and CEO of the Company. "Our FISH equipment sold to leading Chinese hospitals has generated recurring reagent revenue rapidly and we expect the FISH business to be another strong growth driver of the Company in addition to our ECLIA business. We completed the BBE acquisition in January 2008 and expect the new acquisition to be accretive starting from 4Q FY2007."
The company this week announced the completion of development of the Prostate Cancer FISH Detection Kit (the "Kit"), a prostate cancer-specific molecular diagnostic test based on the Fluorescent in situ Hybridization ("FISH") technology. The Company expects to launch the Kit in July 2008.
CMED has posted an average surprise of 19.1% over the past four quarters. During the last month, this year's earnings estimates have increased six cents to $1.58 per share. Analysts expect a further 47% jump to $2.31 next year. The stock is cheap at 19.5x next year's estimates, well below its long-term growth rate of 25%.
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Monday, April 07, 2008
CMED - China Medical - stock is cheap at 19.5x next year's estimates, well below its long-term growth rate of 25%
ACN - Accenture Ltd - ROE of 73%, which is well above the industry average of 11%
Accenture Ltd. (ACN), a Zacks #1 Rank (Strong Buy) company, posted fiscal second-quarter earnings of 64 cents per share, exceeding the consensus estimate by 12% and surpassing the year-prior result. Net revenues of $5.61 billion jumped ahead of the previous year’s total by 18%. The company upped its earnings guidance for the full fiscal year as did Wall Street. The great thing about Accenture is that its solid fundamental growth is not its only positive feature. The consulting company also offers income, currently yielding about 1.2%. ACN also boasts an appealing ROE of 73%, which is well above the industry average of 11%.
Full Analysis
Accenture is a global management consulting, technology services and outsourcing company. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments.
The Zacks #1 Rank (Strong Buy) company recently announced that it signed an agreement to acquire SOPIA Corporation, a privately-held consulting and IT solutions company that is based in Tokyo and specializes in Oracle systems integration. ACN noted that the terms of the deal were not disclosed.
“This acquisition will enable Accenture to expand its systems integration capabilities in Japan,” said Karl-Heinz Floether, Group Chief Executive of Systems Integration, Technology & Delivery at Accenture. “Japanese clients will benefit from Accenture’s business and industry consulting capabilities, industrialized delivery methodologies, and global reach, and SOPIA’s skills across the entire Oracle suite, and supply chain management software packages.”
In late March, Accenture posted fiscal second-quarter earnings of 64 cents per share, exceeding the consensus estimate by 12% and surpassing the year-prior result. Net revenues of $5.61 billion jumped ahead of the previous year’s total by 18%.
William D. Green, Accenture’s chairman & CEO, said, “Our strong performance in the second quarter reflects the momentum we have seen in the marketplace and the essential nature of our services, as clients rely on the value we deliver in helping them achieve high performance in a challenging economic environment. With strong bookings, including our highest consulting bookings ever, we are seeing solid demand for our services.
The company upped its earnings guidance for the full fiscal year by 19 cents to a range of $2.55 to $2.60 per share. Wall Street followed suit. Ten out of 11 covering analysts increased estimates for the year ending August 2008 to $2.56 per share, versus last month’s $2.39. Some analysts are forecasting $2.59. In fact, the most accurate projection is currently pegged at the $2.59 level.
The great thing about Accenture is that its solid fundamental growth is not its only positive feature. The consulting company also offers income, currently yielding about 1.2%. This is a solid dividend yield when compared to many other companies in ACN’s industry, most of which offer no dividend.
Accenture also boasts an appealing return on equity (ROE) of 73%, which is well above the industry average of 11%.
Content Courtesy: Zacks Investment Research
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CSX - CSX Corp - third time in three quarters that the company has surprised and beaten analyst estimates
CSX Corporation (CSX) shares received a very nice little pop when the company boosted its first quarter guidance on Mar 31. This news came on the heels of the company's very solid fourth-quarter and full-year results in which its quarterly profit was up 5% from the same period last year. Put theses two factors together and you have a recipe for a stock that is on the move. CSX shares are up close to 30% on the year.
Full Analysis
CSX Corporation owns companies providing rail, inter-modal and rail-to-truck transload services. The company's transportation network connects more than 70 river, ocean and lake ports, as well as 200 short line railroads. CSX Corporation was founded in 1827 and is based in Jacksonville, Florida.
Shares of CSX have been on a roll since Mar 17 when the company announced that it was expecting its first quarter profit to rise between 42% and 48%. CSX is now expecting profit to be between 74 and 77 cents, which includes a 4 cents per share gain related to the sale of real estate. Shares had been trading right around $48 at the time, and have since advanced beyond $58, representing a very impressive short-term gain of more than 20%.
This announcement comes on the heels of the company's already impressive fourth quarter results, reported on Jan 22. Revenue was up 7% to $2.58 billion. Net income totaled $365 million, up 5% from the same period last year when income was $347 million. This produced earnings of 86 cents per share, well ahead of analyst expectations of 64 cents.
CSX reported a nice jump in growth in its surface transportation business, producing a 26% increase in its operating income to $2.2 billion. The company added that it benefited from improved safety, which enabled it adjust its reserves for personal injury.
Although CSX is operating in an energy intensive environment that is presenting unique challenges to its prosperity, the company said that it has benefited from increased shipping demand of high-demand products such as agricultural products, chemicals and fertilizers.
This marks the third time in three quarters that the company has surprised and beaten analyst estimates, having done so by an average of 11 cents, or 16.7%.
Full-year income for CSX totaled $1.23 billion, producing earnings of $2.99 per share, up from earnings of $2.82 per share last year. Full-year revenue grew to $10.03 billion from $9.57 billion last year.
With all of the good news rolling in like a freight train, the company's share price has been on quite a ride lately. For the year, share are up close to 30%, an impressive gain in any environment and even more impressive in this tepid economic environment.
Looking ahead, the key to the chart is the resistance level just above $58. This area is the 52-week high and all-time high, and has been tested numerous times over the last two weeks. With the up trend continuing to maintain its strength, it should only be a matter of time before this stock advances beyond this area and into uncharted territory. CSX reports its first quarter results on Apr 15.
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WDC - Western Digital - increasing its stock buyback program by $500 million
Western Digital is showing no signs that a global slowdown is affecting the hard drive market as electronic gadgets remain hot with consumers. The company is a hybrid of both a growth and a value pick. Earnings are projected to grow by 13.1% over the next five years yet Western Digital has a 2008 P/E of only 6.75.
Full Analysis
Western Digital Corporation (WDC) is the second largest manufacturer of hard drives in world. The company's products include 3.5-inch, 2.5-inch, and 1.0-inch form factor drives, as well as enterprise hard drive products, which are offered under various brand names that include WD Caviar, WD Raptor, WD Scorpio, WD Passport, My Book, My DVR Expander, GreenPower, and WD Raid Edition.
WDC, a Zacks #1 Rank (Strong Buy), continues to introduce new products. Last year, Western Digital was the first to the market with a 320 gigabyte drive for laptops, significantly larger than competitors' drives.
The company continues to take advantage of strong demand for consumer gadgets, such as notebook computers and digital video recorders, which require ever expanding amounts of storage capacity.
On Apr 3, WDC announced it was increasing its stock buyback program by $500 million. Previously, the company's program authorized $250 million in share buy backs. This new program will extend the program for five more years.
In January, the company easily beat on estimates for the second quarter by 29.81% or 31 cents per share. Sales were up 54% in the quarter.
Brokerage analysts have been raising earning estimates since that report. Third-quarter consensus estimates rose 21 cents to $1.08 from 87 cents in the last 60 days. For the fourth quarter, estimates are up in the last 60 days by 10 cents to 81 cents from 71 cents per share.
Similarly, the full year estimates are also up. Consensus estimates rose 39 cents to $4.04 from $3.65 per share in the last 60 days. Four out of 19 covering analysts raised estimates in just the last 30 days.
Analysts are estimating 2008 year-over-year earnings growth of 108.14%.
The company is still cheap. It has a 2008 P/E of 6.75, far under the industry standard of 45.8. Its price-to-book is 2.85. The company has a tremendous five year average return on equity of 45.77%. WDC reports third-quarter earnings on Apr 24.
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