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If you are looking to increase your exposure to non-US small cap stocks, you will find some profitable candidates in this article for which you may want to keep an eye on.

To construct this list we focused on non-US stocks with market cap between $100M and $500M, this gave us a universe of over 150 securities to work with. We then looked at each of these names and kept those that beat industry averages in all of the following profitability metrics:

- TTM Gross margin
- TTM Operating margin
- TTM Pretax margin

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.



Considering this information, which of these stocks do you think has the most upward momentum moving forward?

1. ChinaCast Education Corporation (OTCPK:CAST): Education & Training Services Industry. Market cap of $233.47M. Hong Kong. Gross margin at 67.54% vs. industry average 53.16%. Operating margin at 31.62% vs. industry average 22.03%. Pretax margin at 23.11% vs. industry average 18.34%. The stock is a short squeeze candidate, with a short float at 24.31% (equivalent to 12.72 days of average volume).

2. China Fire & Security Group, Inc. (NASDAQ:CFSG):
Industrial Equipment & Components Industry. Market cap of $226.78M. China. Gross margin at 49.99% vs. industry average 34.12%. Operating margin at 19.08% vs. industry average 12.55%. Pretax margin at 20.53% vs. industry average 10.63%. The stock has lost 30.43% over the last year.

3. China Green Agriculture, Inc. (NYSE:CGA): Agricultural Chemicals Industry. Market cap of $116.53M. China. Gross margin at 41.34% vs. industry average 36.25%. Operating margin at 27.27% vs. industry average 15.12%. Pretax margin at 26.89% vs. industry average 14.18%. The stock is a short squeeze candidate, with a short float at 18.29% (equivalent to 11.82 days of average volume). The stock has performed poorly over the last month, losing 33.23%.

4. China Information Technology, Inc. (NASDAQ:CNIT):
Application Software Industry. Market cap of $102.0M. China. Gross margin at 50.46% vs. industry average 46.97%. Operating margin at 27.14% vs. industry average 24.82%. Pretax margin at 27.16% vs. industry average 24.91%. The stock has performed poorly over the last month, losing 27.78%.

5. Excel Maritime Carriers, Ltd. (NYSE:EXM): Shipping Industry. Market cap of $260.50M. Greece. Gross margin at 66.24% vs. industry average 61.76%. Operating margin at 39.78% vs. industry average 34.75%. Pretax margin at 31.32% vs. industry average 18.8%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.87). The stock is a short squeeze candidate, with a short float at 8.56% (equivalent to 5.77 days of average volume).

6. Jinpan International Ltd. (NASDAQ:JST):
Diversified Electronics Industry. Market cap of $181.61M. China. Gross margin at 41.31% vs. industry average 35.83%. Operating margin at 11.56% vs. industry average 10.72%. Pretax margin at 12.65% vs. industry average 7.48%. The stock has performed poorly over the last month, losing 15.57%.

7. Orbotech Ltd. (NASDAQ:ORBK):
Diversified Electronics Industry. Market cap of $450.51M. Israel. Gross margin at 39.56% vs. industry average 37.02%. Operating margin at 12.05% vs. industry average 9.62%. Pretax margin at 10.88% vs. industry average 10.57%. The stock has gained 6.71% over the last year.

*Data sourced from Fidelity and Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 7 Most Profitable Foreign Small Cap Stocks