Lebed.biz Alert – SGAS closes up 19% on record volume!
Sino Gas International (SGAS) was up 19% today to $0.50 on record volume of 758,465!
SGAS reminds me very much of GFRE at $0.22, which closed at $1.20 today.
SGAS has a book value on a fully diluted basis of $1.94 per share. SGAS generated net income in 2008 of $1.6 million and when you exclude $1.2 million in non-recurring charges, SGAS currently has a P/E of 5!
SGAS recently reported 1Q results (historically one of their weakest quarters). 1Q revenues were up 16% over a year ago to $5.038 million and net income was up 132% over a year ago to $345,637.
I consider utility companies in China to be some of the safest investments out there with the biggest upside potential. SGAS earns huge gross margins on connection fees when they hook up a residential apartment with natural gas and then generates recurring natural gas sales from those customers on a monthly basis.
SGAS‘s customer base in 2008 grew by an amazing 36%! Many American utility companies are trading with P/E’s of 15 when they have no where near that kind of growth!
China’s new stimulus package and other measures they are taking to boost their economy could mean a huge rebound in SGAS‘s new connections in the second half of 2009 and in 2010!
In 2007, when the Real Estate market in China was booming, SGAS earned an unbelievable $7.7 million in net income! If China’s stimulus is successful, SGAS could have the potential to report those type of numbers once again in the future!
SGAS‘s fully diluted market cap at $0.50 is only $15 million!
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Jonathan Lebed
Lebed.biz
Staff
Jonathan Lebed
Lebed.biz
Staff
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