It took Monster Worldwide (NYSE: MWW) just four years to launch Monster.com from its $7 IPO price to a more than $70 share price.
And over in China, a similar story is about to unfold.
Now, some analysts will tell you that Chinese stocks are already overvalued, and that companies in other regions of the world represent better bargains (like Brazil, for example). But they’re not factoring in the huge growth of this industry.
The improving economy has online job-search traffic in China set to grow 23% by the end of the year. But prospective Chinese employees won’t be checking the postings on Monster.com. Instead, they’ll visit a site run by Shanghai-based 51job Inc. (Nasdaq: JOBS).
Shares of this employment opportunities provider are up a mammoth 184% this year, prompting Citi Investment Research to raise its price target from $47 to $58 (shares are currently hovering around $47.50). And here’s why…
51job’s Profits are Set to Explode as China Goes on a Hiring Spree
Founded in 1998, 51job.com is China’s most visited jobs site. It posts openings for more than 142,000 employers – up 56% from just a year ago.
And with the various stimulus programs and an improving global economy taking effect, companies are posting job openings at a much higher rate than expected, according to the Asian Development Outlook.
Over the first half of 2010, China created 6.38 million new jobs in urban areas – a number than should reach nine million by the end of the year. And each opening represents a potential source of income for 51job.
For the fourth quarter, the company predicts revenue of roughly $42 million – a 27% increase over last year. But given its steady rise as an industry leader, that may be a conservative estimate…
51job Double-Teams the Market and Slays Its Larger Competitors
51job is not only the best place for companies to post their ads – it’s also the cheapest. Its price undercuts heavyweights, China Career Builder and Monster.
And because 51job’s services are city-specific, with print sections in local papers, firms can easily reach much larger audiences. It’s a no-brainer for businesses and over the coming years, this strategy will help 51job dominate new markets.
At a time when the United States is desperately trying to generate new jobs, it’s a different story in China – as evidenced by 51jobs’ terrific year. But there’s still plenty of room to grow – and as the company continues to expand its reach throughout China, its $1.4 billion business will explode.
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