TPS Position Update – January 6, 2016
. . . . Sino-Global Shipping America, Ltd. (NASD: $SINO) – Hold
We were pleased to see the firm report positive financial results for the first quarter of fiscal 2016.
Revenue grew 3.6% year-over-year and gross profit grew by 21.9%. Expenses for the quarter were down 9.1%.
The balance sheet is stronger and a stock repurchase plan is underway. So far, the company has repurchased 12,266 shares at an average price of $0.8319 per share.
A few weeks ago, Sino-Global CEO Lei Cao told investors, “We…are confident that as we continue to build our logistics network, the measures taken over the past several quarters combined with our strong balance sheet will all add value for our shareholders over the long-term.”
We recommended Sino-Global in September 2015 at $1.01.
Now, after the recent first trading day of 2016 pullback, it’s at $0.69.
We will continue to be patient investors and look for Sino-Global to continue its rebound.
. . . . Kingold Jewelry, Inc. (NASD: $KGJI) – Hold
Kingold is a leading Chinese manufacturer and designer of 24-karat gold jewelry, ornaments, and investment-oriented products.
As with Sino-Global, it too has been battered by the Chinese market correction, and it too has recovered from its 2015 lows.
We recommended Kingold in June 2015 at $1.04. Shortly after, the Chinese market was ravaged and the stock plunged to $0.50.
Today, KGJI trades at $0.71. And alongside the recovery of the stock price, we see two positive signs.
One is financial performance. For the most recent quarter, net sales were up 5.1% and gross profit was up 56.3% against the corresponding quarter for 2014.
The margin is also growing. It stands at 5.9%, up from 4.0% in 2014.
The other positive sign…
Later this year, the firm will launch what it calls Jewelry Park in Wuhan City.
This is a real estate development for the jewelry business, similar to 47th Street in New York City, where the diamond trade is centered.
Jewelry Park is scheduled to open later this winter.
Action To Take
- Hold Sino-Global Shipping America, Ltd. (NASD: $SINO)
- Hold Kingold Jewelry, Inc. (NASD: $KGJI)
Category: TPS Update
