Why Shares of E Commerce China Dangdang Inc Jumped Again

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of E Commerce China Dangdang Inc  (NYSE: DANG  ) were surging for the second straight day today, gaining as much as 14% following Thursday's blowout earnings report.  

So what: Investors apparently couldn't get enough of the Chinese online retailer yesterday as the stock soared throughout Thursday's session, and immediately jumped out to double-digit gains today. In its earnings report, Dangdang posted a surprise profit of $0.07 a share on a expectations of a $0.04 loss, while revenues increased 22.1% to $325.7 million, better than expectations of $317.7 million. 

Now what: There's clearly a lot of potential in online retail in a fast-growing economy with more than 1 billion consumers, as demonstrated by the explosive growth of stocks like Dangdang and Vipshop Holdings. Even at home, share of flash-sale retailer Zulily jumped more than 50% this week on its own blockbuster earnings. Like Amazon.com, Dangdang has transformed itself from an online bookstore to an all-in-one retailer, a transition that seems to be paying off based on this latest report. For 2014, analysts had been expecting a $0.06-per-share loss, but I'd expect those numbers to get a solid bump given this report and the company's upside first-quarter guidance of 30% revenue growth.

What other stocks are ready to soar?
Ask Motley Fool co-Founder David Gardner. He's found stocks with returns like 926%, 2,239%, and 4,371% time and again. In fact, just recently one of his favorite stocks became a 100-bagger, and he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.


Read/Post Comments (0) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2859726, ~/Articles/ArticleHandler.aspx, 8/21/2014 7:37:13 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement