When I first saw the ratios this company was trading for as of early July 2010 – I could hardly believe my eyes. Here we have a company whose revenues have increased 338% since 2006 – and whose revenues are expected to increase by 80% this year alone, trading at a P/E of 6,5.
With a market cap of 80 million (7th July) anda guided 129 million in revenues for 2010– this company’s P/S ratio is a mere 0,62. China’s three main carriers accounted for 98% of this company’s revenues in Q1 2010. Having three companies account for almost all of a company’s revenue is not desirable, but still, future is looking good for TSTC.
With the Chinese Communist Party investing heavily in telecom, especially 3G, and 4G in the future to come, there won’t be any lack of orders for this company, and if you take into consideration that the regime favours national companies to support national R&D in technology, you are looking at growth company selling for the price of a stalwart.
Disclosure: Long TSTC