December 19, 2006
SpeculatingStocks.com Stock Pick: Fuwei Films Co. Ltd. (FFHL)
Stock Price: $11.08 (short-term strong buy)
Fuwei Films Co. Ltd. develops, manufactures and distributes high quality plastic film using the biaxial oriented stretch technique, otherwise known as BOPET film (biaxially oriented polyethylene terephthalate). Fuwei's BOPET film is widely used to package food, medicine, cosmetics, tobacco and alcohol, as well as in the imaging, electronics, and magnetic products industries.
FFHL just went public today and closed up $2.80 to $11.08 on 4.58 million shares traded. China IPO's continue to be extremely hot.
FFHL appears to have a float of only 3.75 million shares. The company generated funds of $31.05 million at an offering price of $8.28.
For the six months ended June 30th, 2006, FFHL generated revenue of $27.51 million with net income of $4.03 million. Annualizing these results, our calculation puts FFHL at an EPS of $0.64 and a PE of 17.14.
The company's high barrier film product uses nanotechnology to increase the film's barrier properties.
FFHL was the #4 gainer on the NASDAQ today and appears to have the makings of an exciting momentum play.
SpeculatingStocks.com Target Price: We expect FFHL to reach $20.00 within the next two weeks.