Monday, July 30, 2007

CDC Corporation

CDC Corporation is a NASDAQ listed security that has been trading in a range between $4.09 and $11.45 over the past year. With 114,944,200 shares outstanding, a recent price of $9.03 gives a total market capitalization of $1,039,095,564. While there are certainly larger companies, CDC Corporation has definitely earned its place in the pack. Last year, CDC Corporation created $0.10 in earnings for every share outstanding.

CDC Corporation is currently priced by the market at 98.10 times last year’s earnings. Many trading multiples around the world are quite attractive these days, but don’t be fooled. A Price to Earnings ratio of 0 simply means that the security didn’t make any money last year.

With a share price under $50 a share and earnings per share below $1 a share, CDC Corporation could be an interesting value proposition. Consistent earnings are the key to high valuations and this security is well on its way.

0 comments: