For his Greater China portfolio, Covestor model manager James Hofmann seeks “to invest directly in China through equities ADRs, using a value-based strategy” combining “a top-down macro approach… with a bottom up equity valuation.” Current top holdings in the model are Trina Solar Ltd (TSL), China Petroleum & Chemical Corp (SNP), and China Mobile Ltd (CHL).
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On January 28, February 3 and February 17, James added shares of Lihua International Inc. (NASDAQ: LIWA) to the model. LIWA produces copper replacement cable and wire products for sale primarily in China. LIWA issued a press release containing its preliminary unaudited 2010 financial results on February 22, indicating that the company had experienced revenue growth of 129% and profit growth of 71%. From the company’s press release:
“2010 was another year of growth and successful execution for Lihua, evidenced by our strong top – and bottom-line performance,” said Mr. Jianhua Zhu, Chairman and Chief Executive Officer of Lihua. “The solid growth of our business is a result of our new refined copper product offering, capacity expansion in both refining and wire drawing, and strong customer demand for all of our products. Importantly, the addition of copper anode to our business has significantly bolstered our volume demand. We are now addressing a greater segment of the market for considerably larger quantities than historical levels among our wire business.”
The company also increased its 2011 guidance, aiming for improved operations resulting from a new copper recycling facility. On SeekingAlpha.com, Kapitall recently wrote the bullish case on LIWA, noting the company’s buyback program, strong management, insider purchases and inventory management programs.
Despite these results and its announced buyback program, LIWA’s shares dropped 3.3% in regular trading on February 23.
Sources:
“Lihua International, Inc.: NASDAQ:LIWA quotes & news” Google Finance 02/23/2011 http://www.google.com/finance?q=nasdaq:liwa
“Lihua International Announces Preliminary Unaudited 2010 Financial REsults” PR Newswire 2/22/2011
“6 Stocks with Buyback Programs, Seeing Institutional Buying” Kapitall, SeekingAlpha 2/9/2011 https://seekingalpha.com/article/251668-6-stocks-with-buyback-programs-seeing-institutional-buying
