4-Star Stocks Poised to Pop: NIVS IntelliMedia

Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, consumer electronics manufacturer NIVS IntelliMedia Technology Group (AMEX: NIV  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at NIVS' business and see what CAPS investors are saying about the stock right now.

NIVS facts

Headquarters (Founded)

Huizhou City, China

Market Cap

$130.5 million

Industry

Consumer electronics

Trailing-12-Month Revenue

$267.04 million

Management

CEO Tianfu Li (since July 2008)
CFO Alexander Chen (since October 2010)

Return on Equity (Average, Past 2 Years)

31.3%

Cash/Debt

$25.11 million / $63.12 million

Competitors

Microsoft (Nasdaq: MSFT  )
Motorola (NYSE: MOT  )
Nokia (NYSE: NOK  )

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 99% of the 376 members who have rated NIVS believe the stock will outperform the S&P 500 going forward. These bulls include Option1307 and All-Star Seansonfire, who is ranked in the top 5% of our community.

This past summer, Option1307 wrote that NIVS' bargain-like valuation was almost too good to be true:

I know everybody in the world right now is suspect of fraudulent Chinese companies, and with good reason as several have gone all "Enron" on us with their financials recently. But if [NIVS] is even remotely telling us the truth on their income statements, holy geez is this undervalued!

Despite some skepticism over its financials, NIVS is just way too cheap for our community to ignore. Over the past two years, the audio and video equipment specialist has posted whopping compounded sales and profit growth of 67% and 52%, respectively. Yet for whatever reason, NIVS sports an unbelievable P/E of four -- a massive discount to slow-growing multinational foes like Microsoft (12.1), Motorola (45.7), and Nokia (33.6), as well as closer Chinese rivals China Mobile (NYSE: CHL  ) (12) and China Telecom (NYSE: CHA  ) (19.8). If NIVS' voice-recognition tech is as decent as CAPS member Seansonfire believes, it's tough to see the shares trading this cheaply forever:

The thing I like is their focus on the Intelligent aspect of their products, which is voice recognition integrated into several of its products. This means TVs, Robots, Cable boxes, DVD players, and other electronics can be controlled via Voice commands. This is not a totally unique technology as other companies have access to it through other patents or technologies, but it does NIVS a potential takeover target for a larger electronics manufacturer. They continue to work with Universities in China through research agreements to improve the technology, which could yield further patents which many help contribute to the success of the company.

What do you think about NIVS, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Microsoft is a Motley Fool Inside Value pick. Motley Fool Options has recommended a diagonal call position on Microsoft. The Fool owns shares of Microsoft and China Mobile. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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