Saturday, November 21st, 2009

GrenTech: China Does it Again

Aug 14th, 2009 | By Andrew Snyder | Category: Emerging Markets

Chinese stocks are dominating the domestic equities market. If you think the trend is going to end sometime soon, you had better think again. Winners like China GrenTech (NASDAQ:GRRF) are here to stay.

There are few certainties in this overbought market, but one common theme lately has been the dominance of China’s small caps. Seemingly every day, a little-known Chinese company is topping the biggest-mover list.

Today’s list leader is no exception.

China GrenTech (NASDAQ:GRRF)
shareholders are watching their positions surge by nearly 50% as investors try to get their hands on this thinly traded microcap.

With an average of just 70,000 shares exchanging hands in any given session, today’s massive trading of over four million shares is a sign investors are willing to pay a premium to get their hands on the $6 million company’s future earnings potential.

The surge in the wireless product provider’s value comes thanks to its latest earnings report, which showed revenues ($62 million) increased by over 125% and earnings ($2 million) surged into profitable territory during the last quarter. Gross profit (the figure the government cares about) came in at nearly $50 million, up 70% year-over-year.

As you probably know, the gang at TFN has been all over the growth situation in China. That is why today’s move is so very intriguing. The fact that much of the company’s growth comes through a demand for higher technology and advanced infrastructure proves China’s growth prospects are on par with the growth this country saw during the last half of the twentieth century.

We’re out. They’re in

The macroeconomic forces that put Chinese companies atop the leader board nearly every day are not going away anytime soon. Remember, money always flows through the path of least resistance.

Why would anybody risk their wealth in a politically risky, volatile American market that is likely to stagnate for the next several years, when they could hunker down in an economy growing by 8%, 9% or even 10% well into the foreseeable future?

The amount of cash flowing into China GrenTech today proves that many investors feel it is a safer move than putting money into something like Citigroup (NYSE:C), which has the government crawling all over it.

Investing in international companies has never been easier. GrenTrech trades electronically through the NASDAQ system. That means buying its shares are no harder than buying shares of Apple (NASDAQ:AAPL) or Sirius XM Radio (NASDAQ:SIRI).

With just a few clicks of the mouse, you have international exposure AND a shot at one of the hottest-growing economies on the planet.

You know where my money is going. If not, read this report.

Source: GrenTech: China Does it Again


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Read more on Investing in China, China Grentech at Wikinvest
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By Andrew Snyder

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Andrew is a contributor to Daily Reckoning Australia and Today's Financial News.

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Today's Financial News provides an independent and practical perspective on the U.S. and global investment markets. We provide you with a free, reliable, easy, up-to-date, and focused resource to help you make your financial decisions with commentary, interviews, recommendations, and video. Today's Financial News includes the analysis and opinions of those editors whom we have come to trust over the course of the years.

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