Lihua International Confirms 2010 Guidance
LIWA is a leading Chinese developer, designer, and manufacturer of low cost, high quality alternatives to pure copper products, including refined copper products and superfine and magnet wire, as well as copper clad aluminum ("CCA") wire.
LIWA operates in a highly desireable area in the China market. China is deficient in copper reserves therefore requiring them to import large quanities. LIWA provides a solution by recycling copper products and developing copper alternatives. What isn't to like about this stock? Nothing except concerns over fraud in the smallcap China stocks.True their is concern over financial standards, but the issue seems to be overblown because of issues at a few other companies.
This stock remains a huge bargain but the unknown is when the market will catch onto and believe the reported results.The chart looks hopeless unless the current bottom holds.
Lihua also reiterated its full year 2010 financial guidance: -- Gross profit of $52.9 million to $55.7 million, representing 46-53% growth over 2009. -- Non-GAAP net income of $38.1 million to $40.3 million, representing 48- 57% growth over 2009 (or $1.3 to $1.4 EPS based on 29.3 million fully diluted shares a/o 6/30/10). -- Based on its current growth initiatives, including investment in the completion of a new smelter that will effectively double its production capacity to 100,000 metric tons by YE 2011, Lihua expects its 2011 cash balance as of December 31, 2011 to be between $75 million to $85 million.
Disclosure: Long LIWA