China Kanghui Holdings
The 10-second takeaway
For the quarter ended March 31 (Q1), China Kanghui Holdings beat expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share increased significantly.
Gross margins shrank, operating margins dropped, net margins grew.
China Kanghui Holdings reported revenue of $13.1 million. The four analysts polled by S&P Capital IQ wanted to see sales of $12.7 million on the same basis. GAAP reported sales were 26% higher than the prior-year quarter's $10.4 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.18. The four earnings estimates compiled by S&P Capital IQ predicted $0.19 per share. GAAP EPS of $0.18 for Q1 were 29% higher than the prior-year quarter's $0.14 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 70.8%, 90 basis points worse than the prior-year quarter. Operating margin was 38.1%, 570 basis points worse than the prior-year quarter. Net margin was 35.9%, 360 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $15.5 million. On the bottom line, the average EPS estimate is $0.22.
Next year's average estimate for revenue is $62.9 million. The average EPS estimate is $0.91.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 23 members out of 34 rating the stock outperform, and 11 members rating it underperform. Among 11 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), six give China Kanghui Holdings a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on China Kanghui Holdings is outperform, with an average price target of $23.64.
Over the decades, small-cap stocks, like China Kanghui Holdings have provided market-beating returns, provided they're value priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
- Add China Kanghui Holdings to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. 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.