Even though there has been much talk recently about the slowing China economy, some of the best-acting stocks in the U.S. market are China based. For example, LightInTheBox (LITB), which I have discussed a number of times, is flying higher as the story is uncovered.
Here are three China-based stocks I'm watching closely for momentum moves.
Cleantech Solutions (CLNT) jumped sharply in early July after the CEO announced, "We expect to see strong growth in our top and bottom lines in 2013, led by sales of airflow dyeing machines and anticipated sales of new products, including our after treatment compacting machine." The company has no analyst coverage, which removes some risk of holding into a report that will likely hit next week. The company has a trailing price-to-earnings ratio of just 2, and it should post strong numbers. Technically, the stock is trying to turn back up after a spike and fade on the above comment.
NOAH Holdings (NOAH) provides wealth management products in China, such as real estate funds, private equity investments, funds of funds and collateralized fixed income products. On Friday, the company raised guidance by about 50%. It is already expected to grow earnings per share by 42% in 2013, so there is good support for the stock to continue to run as it prices in this excellent growth.
China Automotive Systems (CAAS) manufactures power steering systems and components for China's auto and truck makers. It is leveraged to the high growth Multi-Purpose Vehicle (MPV) sector and recently started moving into the Brazilian and U.S. markets. In the first quarter of 2013, the company posted earnings of $0.21 vs. an $0.18 estimate and a loss of $0.03 last year. The company is expected to grow earnings for the year at a 23% pace, yet is sells with a trailing PE of 10. Earnings are due Wednesday, Aug. 14.