Recs

12

4-Star Stocks Poised to Pop: China Digital TV

Based on the aggregated intelligence of 135,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, digital television equipment maker China Digital TV (NYSE: STV  ) has earned a respected four-star ranking.

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

China Digital facts

Headquarters (founded)

Beijing, China (2004)

Market Cap

$522.87 million

Industry

Application software

TTM Revenue

$67.4 million

Management

Co-Founder/CEO Jianhua Zhu
CFO Liang Xu

TTM Return on Equity

15.9%

Competitors

Kudelski
NDS Group

CAPS members bullish on STV also bullish on

Apple (Nasdaq: AAPL  )
Google (Nasdaq: GOOG  )
Vale (NYSE: VALE  )

CAPS members bearish on STV also bearish on

Baidu.com (Nasdaq: BIDU  )
Bank of America (NYSE: BAC  )
Citigroup (NYSE: C  )

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, fully 603 of the 633 members who have rated China Digital -- some 95% -- believe the stock will outperform the S&P 500 going forward. These bulls include k007005 and sysun.

Last month, k007005 tapped China Digital as a scintillating stock to keep watching:

Cable TV is booming in China, the government is pushing the people of the most populate nation in the world to get digital. The company who has 50% of the market will benefit very soon from this.

In a pitch from one month earlier, sysun elaborated smartly:

China Digital TV is a Chinese company which makes smart-cards, a key component in the set-top boxes which every Chinese television will need to hook up to in order to link into a digital cable network. With the government mandated conversion to digital cable by 2015, [China Digital] has a huge market to potentially capture. As [China Digital] is already the majority market leader (51% of market share and growing), it is very unlikely for the company to end up with anything less than 50% of the future smart-card market. ...

Additionally, [China Digital] has $0 debt, over $3 per share in cash and accessible liquidity, a 60% net margin as mentioned, and almost no capex.

What do you think about China Digital TV, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 135,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Apple is a Motley Fool Stock Advisor pick. Google and Baidu are Rule Breakers recommendations. The Fool's disclosure policy always gets a perfect score.


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2/14/2012 4:02 PM
STV $3.86 Up +0.01 +0.26%
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