China HongXing Fundamental Analysis
- Current Price = $0.16
- Current NAV = $0.30
- Current PE = 15.36 (At Fair Value)
- Rolling PE = 31.68
- Dividend Yield = 2.78%
- FY09 Net Profit Margin = 6.6%
- FY09 ROA = 2.9%
- FY09 ROE = 3.1%
- FY09 Current Ratio = 21.3 (CASH RICH!)
- FY09 Debt to Equity = Net Cash
- Net Cash per share = $0.12
What can a company do if the company is cash rich?
- Shares Buy Back. –> Improve EPS –> Lower PE –> Stock valuation is cheaper.
- Pay Extra Dividend to share holders.
- As a target to be acquired by other competitor. The other company just needs to pay $0.16 per share to get $0.12 net cash per share.
- Acquire other company or brands to boost revenue and profits.
- Buy back all the shares and delist from stock market.
China HongXing Current Chart Pattern
China HongXing is currently showing a Bullish (Declining) Flag pattern. This is a continuation pattern in an uptrend. $0.155 should serve as a strong support as 200D MA support.
In summary: China HongXing is suitable for short term trading but not for long term investing due to weak fundamental. However, there may be some surprises in stock price due to the company strong cash position and the current stock price is 47% discount to the NAV.