Seeking Alpha
Recommended for you:
Value, growth, long-term horizon, medium-term horizon
Profile| Send Message|
( followers)  

Interested in the high growth prospects of emerging markets such as China? For a closer look at US-traded Chinese stocks, we ran a screen.

We began by screening for US-traded stocks of companies based in China for those with high growth projections, with 5-year projected EPS growth above 15%.

We then screened for those stocks with strong sales trends, comparing growth in revenue to growth in accounts receivable over the last year. Since accounts receivable is the portion of revenue not yet received, and there is no guarantee the money will ever be received, the smaller the portion of revenue made up of receivables the healthier the company's revenue.

We screened for stocks seeing faster growth in revenue than accounts receivable year-over-year, as well as accounts receivable comprising a smaller portion of current assets over the same time period.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the 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.

Do you think these companies have strong sales trends? Use this list as a starting point for your own analysis.

List sorted by increase in revenue over the last year.

1. Youku Inc. (NYSE:YOKU): Operates as an Internet television company in the People's Republic of China. Market cap at $2.7B, most recent closing price at $23.67. 5-year projected EPS growth at 52.68%. Revenue grew by 102.87% during the most recent quarter ($309.31M vs. $152.47M y/y). Accounts receivable grew by 82.12% during the same time period ($421.47M vs. $231.43M y/y). Receivables, as a percentage of current assets, decreased from 11.22% to 10.16% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

2. China XD Plastics Company Ltd. (NASDAQ:CXDC): Market cap at $235.27M, most recent closing price at $5.0. 5-year projected EPS growth at 20.00%. Revenue grew by 57.3% during the most recent quarter ($113.93M vs. $72.43M y/y). Accounts receivable grew by -6.39% during the same time period ($58.17M vs. $62.14M y/y). Receivables, as a percentage of current assets, decreased from 56.43% to 23.29% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

3. 3SBio Inc. (NASDAQ:SSRX): Engages in the research, development, manufacture, and distribution of pharmaceutical products in the People's Republic of China. Market cap at $305.89M, most recent closing price at $13.97. 5-year projected EPS growth at 20.00%. Revenue grew by 38.24% during the most recent quarter ($139.88M vs. $101.19M y/y). Accounts receivable grew by 20.16% during the same time period ($161.19M vs. $134.15M y/y). Receivables, as a percentage of current assets, decreased from 16.91% to 16.24% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

4. Deer Consumer Products, Inc. (OTC:DEER): Engages in the design, manufacture, and sale of small home and kitchen electronic appliances. Market cap at $95.4M, most recent closing price at $2.92. 5-year projected EPS growth at 20.00%. Revenue grew by 18.83% during the most recent quarter ($73.95M vs. $62.23M y/y). Accounts receivable grew by -44.91% during the same time period ($32.32M vs. $58.67M y/y). Receivables, as a percentage of current assets, decreased from 50.08% to 29.51% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

*Accounting data sourced from Google Finance, all other data sourced from Finviz.

Source: 4 High-Growth Chinese Stocks With Strong Sales Trends