5 China Stocks I'm Watching This Week

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 |  Includes: CHCG-OLD, CHLN, CRTP, SGAS
by: China OTC Player

1) In what I believe to be China Ritar Power's (OTC:CRTP) first ever press release, the company announced on 2/14 that it is attending the Roth Capital Conference in California this coming week. But there are two really interesting bits of information that came with it. First, it is expecting FY2007 revenues of $75 million and net income of $6.4 million (implying an EPS of $0.34), and that its IR is Bill Zima of ICR. Has this company finally awoken to the importance of cultivating its shareholder base?

2) Sino Gas (OTCQB:SGAS) gave us a preview of its FY2007 results by announcing last week that it expects to report revenues of $20 million and net income of $7.9 million. If so, this would represent an extremely respectable 84% top line growth and 53% bottom line expansion. This translates into an EPS of $0.32, which when applied to the current share price of $3.87, gets us a P/E of 12.2x. Given that some OTCBB stocks are trading at 4 to 6 times, isn't the company's share price getting ahead of itself?

3) On the other hand, China 3C Group (OTC:CHCG-OLD) registered a 52-week low of $2.25 on Friday, with no news at all from the company. CHCG's shares have been on a downward trend lately, despite the expectation that it will compile an EPS of $0.42 for FY 2007 (giving a current P/E of 6.0x). Is this the turning point for the beleaguered stock, and will we ever hear from the company's new IR firm ICR?

4) MyStarU.com [MYST.OB] reported its Q1 results this week and something interesting emerged. It appears that its film and TV production arm is bleeding cash almost at the same rate as its online division is making money. With movies like "Pye Dog" and "Big Movie 2: Two Stupid Eggs", how is MYST ever going to be profitable in a market segment where distribution is difficult and piracy rife, especially when online Subaye.com is growing its membership base by close to 20% per month?

5) Chinese authorities seemed to have done a U-turn by saying its planned property tax regime will now not kick into effect this year. This should be good news for property players, including Xi'an-based developer China Housing & Land (NASDAQ:CHLN). However, is this a reaction to signs of a cool down in the sector, which is already apparent in some of the larger cities? And if so, is this going to be of any impact at all?

My Position: Long CHCG.OB.