China Tracker - Details for China Valves Technology (CVVT)


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 China Valves Technology
Shares Outstanding (MRQ): 35.68 mill 
New Shares / Dilution (TTM): 1.17 mill3.40%
New Shares / Dilution (since Dec 31, 2008): 12.69 mill55.21% 
Cash (MRQ): 24.20 mill0.00%
Account Receivables (MRQ): 95.83 mill0.00%
Account Receivables (Q/Q): + 11.68 mill13.88% 
Long-Term Debt (MRQ): NO DEBT
Revenue Growth (Q/Q): -19.72% 
Revenue Growth (Y/Y): 56.64%
Net Income Growth (Q/Q): 57.30% 
Net Income Growth (Y/Y): 26.51%
EPS Growth (Y/Y): 22.36%
Net Margin (Q/Q): 15.9% (8.1%)7.80% 
Net Margin (Y/Y): 15.9% (19.6%)-3.80% 
EPS | P/E (2 MRQ Projection): $0.610.00 
CFPS | P/CF (2 MRQ Projection): $0.070.00 
Price/Sales (2 MRQ Projection): 0.00
Price/Book (MRQ): 0.00 
Auditor: Frazer Frost
 
 Forward Projections (Fiscal Year)
EPS | P/E (Estimates updated 2010-10-31): $1.250.00 
 Basic Facts and History (show more)
Reporting Type: U.S. Company (10-K Filings) 
Going Public: Reverse Merger on 2007-12-18 
Uplisting to Senior Exchange: on 2009-11-16 at $9.00 (-100.00% since Uplisting)

 Business Outlook

Recent Chain of Events:
2012-09-21 -- Delisting from NASDAQ
2012-09-11 -- Last SEC Filing
2012-07-16 -- Trading halted by NASDAQ
2012-07-09 -- Auditor Resignation
2012-05-08 -- Last Quarterly/Annual Report: Q2/FY2012 ended March 31, 2012

(Source: Trading China, 2012-09-30)

On July 12, 2011, China Valves Technology held an annual meeting of its shareholders at which a majority of the Company's shareholders approved the appointment of Frazer Frost LLP to serve as the Company's independent registered public accounting firm for 2011.

(Source: 8-K Filing, 2011-07-15)

China Valves Technology today announced that the Company has signed a strategic cooperation agreement with Sinopec International Petroleum Service Corporation. Under the agreement, the Company would supply various valve products for Sinopec Petroleum Service's international projects. The Agreement is a general cooperation agreement and is valid from June 16, 2011 to June 15, 2013, and can be further extended for another two years by negotiation between two parties. Both parties agreed that they would sign specific contracts for specific projects under the general cooperation framework. Depending on the specific project, Sinopec Petroleum Service would buy all valve products directly from China Valves or act as a sales agent of China Valves through its more than 35 subsidiaries in the world.

(Source: PR Newswire, 2011-06-16)

    see all Business Outlook notes


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 Analyst Coverage (show less)
2011-08-09Roth CapitalReiterationBuy$5.00
2011-07-18Roth CapitalReiterationBuy$5.00
 

We are lowering our price target on shares of CVVT to $5 (from $7.50) and maintain our BUY rating after shareholders voted to maintain Frazer Frost as independent auditor. An auditor upgrade appears delayed indefinitely, postponing a key prerequisite for multiple expansion, in our view. We believe shares will continue to trade dislocated from fundamentals.

2011-05-11Brean MurrayReiterationHoldn/a
 

We do not expect an announcement for a Big 4 auditor upgrade to be imminent, as management has been promising to preview the event with since Q4/10. In addition, heightened sensitivities around engagement with a major auditing firm appear to be further hindered by ongoing China based RTO governance issues that have plagued sector. This has likely evoked management reference to an imminent engagement with a “Big 5” auditor during the conference call. We would remain on the sidelines as 2011 is best characterized by restructuring efforts and implementing procedural improvements internally, as opposed to pursuing major drivers for growth. We also suggest investors remain patient until there is clarity around its auditor upgrade. Maintain Hold rating.

2011-05-10Rodman & RenshawReiterationOutperform$13.00
 

In our opinion, after several quarters of outstanding growth, much of it coming from acquisitions, the company has entered into a period of digestion and consolidation, during which period macro influence will become more pronounced, management execution will take on greater significance, and blockbuster financial performance will be harder to come by. This is further compounded by difficulties in the U.S. capital market with shareholder lawsuits and pressure to improve both corporate governance and accounting standard further distracting and burdening the management. Thus we are now adopting a somewhat more conservative view on the company's near to medium term financial performance. In this regard, we do not consider the company's Q1 performance as a major disappointment. Revenue was quite close to our estimate, and gross margin of 41.7% represented a nice bounce back from a dismal 35.3% in 4Q10. The high accounts receivable and DSO are a major concern, however. Management cited Chinese government's tightening credit policy and a high number of large state-owned enterprise clients who are accustomed to delaying payments as major reasons for this problem. While we can accept this explanation, we certainly want to see reductions in these numbers, particularly in the current market environment, in which high accounts receivable numbers are often viewed with suspicion. We believe the ability of the management to achieve its stated goal of limiting DSO to 140-145 will be a major testament to China Valves management's competency.

2011-05-10Roth CapitalReiterationBuy$7.50
 

We maintain our BUY rating on shares of CVVT after the company reported 1Q11 results exceeding our expectations. Management maintained its annual revenue growth target of 25-28%, which we believe could prove conservative. We lower our price target to $7.50 and believe meaningful valuation multiple expansion will be limited until CVVT appoints a new auditor and completes its 2011 annual audit.

CVVT is currently followed by 4 analysts. 3 give the stock a positive rating, 1 rate it neutral and 0 give it a negative rating. The average price target is 10.33.


    see all Analyst Ratings

 Recent Financings
2011-01-05Private$10.00 mill1.00 mill shares$10.00
2009-12-29Priced$3.00 mill0.33 mill shares$9.00

 Investor Presentations
2009-02-13 (HTML)   VIEW
CVVT
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SAFETY/RISK SCORE
EXTREME RISK
DETAILS: Safety/Risk Model for CVVT
Current Price:  n/a
F10k Day (2009-04-23): -100.00%$2.76
2009 Close: -100.00%$9.24
2010 Close: -100.00%$10.48
2011 Close: -100.00%$2.13
High (2012-02-08): -100.00%$3.12
Low (2012-09-21): -100.00%$0.40
Exchange:
Market Capitalization: n/a
Total Shares: 35.68 mill
Float: n/a
Avg Volume: 198.00 k
Short Interest: 3.10 mill
Short Ratio: 15.33%15.6 d
Last Quarter: 2011-03-31
Revenue (MRQ): 41.95 mill
Net Income (MRQ): 6.66 mill
Op. Cash Flow (MRQ): -10.42 mill
all financial data provided without warranty