Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Take advantage of the shorts on CHLN

|Includes: China Housing & Land Development, Inc. (CHLN)
 

 

Some of the high number of shorts on CHLN have now begun to unload but the majority of shorts (7% of its total shares outstanding) are still out there with less than 7 days to cover, as calculated as current short interest divided by average volume.  CHLN continued a 3 day up swing on Friday despite a down day in the markets.

China Housing has been showing a lot of growth during the last 12 months and had strong margins that  investors did not seem to read in the recent earnigs reports and see that the true potential in CHLN is not recognized until the housing is sold -the overhead is up front in real estate-.  They have to buy the land, build the house and then sell it.

-- Total revenues increased 227% to $86.6 million from $26.5 million in
       2008.

    -- Total gross floor area ("GFA") sales were 145,529 sq. meters, compared
       to 60,593 sq. meters in 2008, representing a 140% increase.

    -- Gross profit increased 374% to $23.7 million from $5.0 million in 2008.
       Gross margin increased to 27.3% compared to 18.9% in 2008.

    -- SG&A expenses as a percentage of total revenue declined to 10.6% from
       32.1% in 2008.

    -- Operating income was $8.5 million, compared to an operating loss of
       ($9.8 million) in 200.

 

BEIJING, March 10 (Xinhua) -- China's property market grew at the fastest pace in 20 months in February, with housing prices rising at a double digit rate. National Bureau of Statistics (NBS).

Housing prices in China's 70 large and medium-sized cities increased 10.7 percent in February from a year earlier, and were up 0.9 percent compared to the previous month, said the NBS.

Prices of new homes in February rose 13 percent year on year, up 1.3 percent from January, and were mainly pushed up by soaring home prices in Hainan Province as the state government decided to build the island into an international tourist resort in December.

Will there be a property bubble in China?  Maybe, but it -won't- come in the next week to help cover the 2mil shorts on CHLN or to dampen the first quarter profits that it looks like CHLN will be posting!  

 



Disclosure: LONG CHLN LONG CHOP