5-Star Stocks Poised to Pop: China Information Technology
Thu, 02/12/2010 - 23:58 by Brian D. Pacampara
Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, geographic information systems (GIS) software specialist China Information Technology (Nasdaq:CNIT) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at China Information's business and see what CAPS investors are saying about the stock right now.
China Information facts
|Market Cap||$275.4 million|
|Trailing-12-Month Revenue||$134.18 million|
|Management||Chairman/CEO Jiang Lin|
CFO Qiang Kazmerzak
|Return on Equity (Average, Past 3 Years)||25%|
|Cash/Debt||$18 million / $67.8 million|
|Competitors||Autodesk (Nasdaq: ADSK) |
China TransInfo Technology (Nasdaq:CTFO)
Adobe Systems (Nasdaq: ADBE)
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 98% of the 606 members who have rated China Information believe the stock will outperform the S&P 500 going forward. These bulls include ob3y and All-Star TraderMRW, who is ranked in the top 10% of our community.
About two months ago, ob3y touched on the tailwinds working in China Information's favor:
There is a push to move additional manufacturing to inland China as the traditional coastal cities reach capacity. As the new cities reach urbanization over the next few years there's a large chance of this company grabbing some key government contracts. Even without, it's trading near its 52 week low ... and a huge chunk of it is owned internally.
China Information remains a seemingly inexpensive way to go for growth. While the company is expected to grow earnings (23% per annum over the next five years) at a faster clip than rival GIS specialists Autodesk (16.4%), Adobe (12.7%), and China TransInfo (22%), as well as bigger software plays like Microsoft (Nasdaq: MSFT) (9.9%) and Oracle (Nasdaq: ORCL)(14.9%), its shares sport a particularly paltry P/E of 7.8.
CAPS All-Star TraderMRW elaborates on the bull case:
Solid company selling on the cheap right now. ...
The technology infrastructure buildout is in its infancy in China and this company is going to be one of the key beneficiaries.
Recent evidence of this is their [State Grid Corp. of China] contract win. They are the SOLE domestic supplier of GIS services to the largest grid company in China. This is a 10 year, multi-billion $ project.
Buy, hold and enjoy the rich returns over time.
© 2010 UCLICK L.L.C.