2010 Guidance and EPS Estimates
posted by The Traveller on Thursday, March 04, 2010
China Kangtai Cactus (CKGT) is forecasting FY 2010 revenues of $34.8 million, or 35% growth from projected 2009 results of $25.8 million. This translates into Q4/09 revenues of $7.77 million, down 5% from the third quarter. As Q3/09 was the breakout record quarter in CKGT's history, I wouldn't see this guidance as negative - the average for 2009 just sits at $6.0 million so Q4 results should be seen as confirmation of the uptrend.
The company achieved a net margin of 36.8% in the third quarter of 2009. Applying that same margin to the 2010 revenue guidance means CKGT should be able to achive a FY10 net income of $12.83 million or $0.65 per share. This is consistent with my own conservative estimate of 2010e EPS $0.60.
Gulf Resources (GFRE) also issued FY financial guidance. Taking the midpoint of this guidance, GFRE is expecting FY10 revenue of $129.5 million (up 17.5% from 2009) and net income of $37 million (up 21% from 2009). With 35.54m shares outstanding, this translates into a 2010e EPS of $1.07, or just 7% EPS growth from 2009. This number is significantly below my own estimate of $1.20, so I am now calculating with 2010e EPS of $1.02.
Dilution has been heavy for GFRE shareholders in 2009 as the total share count has risen by a whopping 38.6% in just one year. I hope this trend will not continue or Gulf Resources is no longer a value pick for the growth stock investor.
Lihua International (LIWA) preannounced 2009 results and issued FY 2010 guidance. The company expects FY09 revenue of $161.5 million and net income (non-GAAP) of $25.5 million. For Q4/09 this means record revenue of $51.22 million and net income of $7.6 million ($0.32 per share).
Lihua anticipates 2010 year-over-year growth of approximately 30-35% in gross profit and 35-40% in non-GAAP net income. Using the low end of this guidance we can expect FY 2010 net income of $34.5 million or $1.43 per share, which means the stock is currently trading at a forward P/E of 6.3. And that makes this high-growth stock a bargain at the current level.