According to the Prudent Speculator's TechValue Report, AsiaInfo Holdings (ticker: ASIA), a provider of software and networking solutions in China, is a compelling investment. Here are the key points:
Played a major role
in the construction of China's Internet infrastructure and provincial
access networks for all of the country's largest telecom carriers.
Provides software and customer service solutions to
Chinese telecom carriers.
Helps a variety of businesses with expertise in security, human resources, business
intelligence, government and finance.
Diversification through acquisition in 2004:
- With flat telecom spending, ASIA diversified its customer base.
Over 33% of Q4 revenue came from clients
outside the telecom industry.
Those sales were generated by the
company's new Lenovo-AsiaInfo division, which was formed from the
non-telecom-related IT services business acquired in October 2004 from Lenovo Group, and AsiaInfo's former enterprise information solutions business.
Q4 2004 Financials:
- Revenue of $32.2 million, a 5% year-over-year gain.
- This was the first quarter that included results for Lenovo-AsiaInfo.
- EPS of $0.02, from a loss of $0.01 in Q4 2003.
Guidance for FY 2005:
"During the quarter, we expanded our high-margin software
business and strengthened our strategic focus on serving enterprise
customers across a diverse range of industries."
(revenue net of hardware costs that are passed through to customers) to increase 32% - 37% over 2004 levels to $90 - $93 million.
EPS of $0.06 - $0.10 after a charge of $0.02 - $0.06 per share for
expensing non-vested stock options.
Guidance for Q1 2005:
Net revenue of $21 - $22
$0.01 - $0.02.
ASIA's stock market performance: