China Yuchai (CYD): Too good to be true?

Mar.16.05 | About: China Yuchai (CYD)

According to the Fool, China Yuchai (ticker: CYD), a holding company owning 76% of a Chinese diesel engine manufacturer, looks like a great China investment. The business is profitable, growing, cheap, and well-positioned for growth in the Chinese heavy-truck market. So why is the company trading at 6X earnings....

have little institutional interest, and have so many investors betting against it (more than 10% of the company's outstanding shares are short)?

Read here from the

Quick thought: When you are finished reading the Fool piece, come back and take a look at this recent recommendation from one of Forbes' newsletters, Marketocracy. According to the "Marketocracy gurus" on February 1, 2005:

....the M100 also bought diesel truck engine maker China Yuchai,
which trades at just 5.8 times earnings. The stock's close last week at
$9.80 was just shy of its 52-week low, and as of Jan. 10, 11.4% of the
company's 19.4 million share float were short. Gurus expect a
turnaround and have quadrupled their holdings, sending CYD to the top
2% of their portfolios.

How ironic if a "Guru" were proven wrong by a "Fool"! Stay tuned.

China Yuchai's stock market performance: