China's E-House Holdings Ltd. : Questing For Market Dominance

China's E-House Holdings Limited (EJ) is a residential real estate service company, which was incorporated on August 27, 2004. Through its subsidiaries, company it is principally engaged in providing real estate agency and brokerage services in both, primary and secondary chinese real estate markets while covering the consulting and information services side of the business.

E-House's principal focus consists in its real estate brokerage services, comprising three metropolitan areas within China, including Shanghai, Wuhan, and Hangzhou, as well as in Hong Kong and Macau.

In its Primary Services E-House - develops a signature identity and brand that are distinctive to a project, establishing long-term awareness of that particular project among prospective purchasers.

In relation to the Secondary Market - E-House engages in listing and brokerage services including both sales and rentals with the main Shanghai, Wuhan and Hangzhou areas as primary targets. As of March 31 of 2007, E-House had 75 stores in Shanghai, 17 stores in Wuhan and 16 stores in Hangzhou.

Its third business aspect - Real estate consulting and information services - includes tailored applications to meet the needs of developer clients at various stages of the project development and sales process. The consulting services is divided into land acquisition consulting and property development consulting.

Worth noting here is the fact of E-House offering an enhanced service by its real estate information database and analysis system called CRIC (China Real Estate Information Circle system). System provides up-to-date and in-depth information covering residential and commercial real estate properties in all regions in China. This has proven to be a very effective tool, among other things for E-House - against competition in the industry, which by the way remains strong and continually challenged by Century 21 and Coldwell Banker. However, E-House holds at current levels a leading position based on its rapid growth and its unparalleled geographic coverage. On September 25th, E-House was recognized as China's leading real estate consulting and agency service company.

I think a major focal point when analyzing China's real estate industry, has to remain on the urban aspect of it. Urbanization rate is a major indicator representing a country's modernization level. There is no disputing at this point in my opinion, to China's embracing the capitalistic approach in its economy thus pushing country's direction into a more modernized, accessible and resourceful economy. During the second quarter of fiscal '07 the GDP in China rose at an astounding 11.9%. Without doubt, the real estate industry is expected to benefit from such growth.

In the past decade, China's cities expanded at an average rate of 10% annually. From 1978 to 2004, China's urbanization rate rose from 17.9% to 41.8% and its urban population increased from 170 million to 540 million. By the middle of this century, the country's urbanization rate will rise to 75% or so in order to support its overall modernization process, placing the improvement of housing construction and human settlements development at the top of the government's agenda.

Based on these facts and including supply and demand model, in that of the price level moving toward the point that equalizes quantities supplied and demanded, without considering here, E-House's leading industry status ; this company seems uniquely positioned to benefit from the industry's present boom and the long-term projected growth.

E- House's market cap stands at $1.14 billion. Its peg is only 0.75 suggesting stocks poised for price appreciation. Profit margins have come in at 34.42%. Operating margins posted at almost 50%. Revenues, $82.36 million for a Net income of $23.68 million. Current ratio 2.47.

On August 22 - E-House reported second quarter earnings - Total revenues were $24.0 million for the second quarter of fiscal '07, an increase of 147% from $9.7 million for the same quarter in fiscal '06. For the first half of 2007, total revenues were $40.0 million, an increase of 193% from $13.7 million for the same period in 2006. Company's CEO reiterated the fact of being very "pleased with the strong growth company experienced for second quarter and first half of 2007".

Conclusion:

Most stocks in the real estate industry have seen steadily growing revenue over the past few years. This stock has done much better than most of its peers. Its revenues have grown very rapidly. Growth estimates for next fiscal '08 are projected at 39.2%.

Since its initial public offering EJ has fared extremely well. The chart has had its share of volatility but all in line with market decline, I might add - over the subprime debacle. At this point it is important is to note that the trend currently is certainly going in the right direction with the outlook for rest of fiscal 2007 remaining positive.

Stock should realize a $28-$30 price levels short-mid term.


ron

• wallstreetpit.com

article published by Seeking Alpha

Vmware...well - will let its tape make the case

since out first post - as it continues screaming to the upside as I initially alluded, adding another new high of $85.17...

90% market share ownership of the entire virtualization aspect - whether a skeptic or not.....demands respect.....omnipresence is already starting to get established.



ron

• http://wallstreetpit.com/
  

The DryShips Spike Continues

DryShips Inc. (DRYS) is a global provider of marine transportation services, specializing in the transportation of major and minor bulks cargoes.

Mobile TeleSystems - Healthy in absolute terms

Mobile TeleSystems OJSC (MBT) is a wireless communications industry leader as a mobile phone operator in Russia and Commonwealth of Independent States.

In response to a comment made by a reader in relation to my Vmware artcle published today by Seekingalpha

First and foremost and very respectfully here, if read carefully ; article never alluded of market weakness constituting a shorting basis on this ticker, far from it. My whole point rather, was to challenge objectively, the correlation btwn - shorting a solid fundamentally stock such as VMW with its continued uptrend under shaky market conditions, and the pretension of pps unjustifiably high based on standard measures. My personal take is again, that shorting from the angle I just described would not be a viable option from an investment perspective. Day trade/wise...absolutely, one could be on the right side of the trade and scalp it to profitability a few times however, we are talking investment.

In relation to the valuation argument:

Rather then calc'ng only 25% increase btrw fiscal '05-'06 which is still a very significant and positive number......., I'd be nice to accumulatively state what the growth %wise has been, btwn 2003 to present......$100 million in revs 2003 with almost $2 Billion projected in 2008. Yes, explosive is the right word. Also Googles next 5 yrs growth estimates stand at 33.65% while Vmware's stand at 60%. Let's say 1.5 Billion will be added to books in 2008 based on 60% estimates, revenues should reach the $12 Billion mark by 2012.

Imho, to conclusively rate stock as 'over-valued' , based only on its multiples..I'd say ; it is not a sound counter-argument since noone can 100%, base an investment decision on this measure alone with all its already known susceptibilities. My take on Vmware is that ; fair value rather than anything else, should be determined in terms of its ability to maintain its monopoly position at this point along with its pricing premium, if it is to face competition in the very near future. They are in a monopoly position since only one seller and way too many buyers. Over 20,000 companies now running VMware technology, including 99 of the Fortune 100 companies...[they will be omnipresent at some point if they go with this rate.]

Competition/wise, Microsoft currently offers only basic virtualization offerings. To say that somehow, MSFT poses at these present stage in their virtualization efforts "great competition" honestly, it is analytically misinforming. It is true MSFT plans to introduce a more robust enterprise version in fiscal '08, but what we are not mentioning here, is fact of new offering still expected to be lacking in functionality relative to VMware’s comprehensive and constantly improving product set.

Imo, this is a solid company and it will continue to reflect its standing pps/wise.





Ron

• http://wallstreetpit.com/

Article published by Seeking Alpha
http://seekingalpha.com/article/47474-why-shorting-vmware-is-a-mistake#comment-96318

SKS - SAKS not at these levels

I have started a long position on the luxury brand retailer SAKS [SKS] with an entry at $16.56 levels.
Company has a market cap of $2.25 billion. Revenues stand at $3.14 bln, Gross profit ttm is $1.14 bln. Net Income came in at almost $21 Million. Total cash is about $130 Mln versus a Total debt of $576 Mln. 130 Mln floater.

I would agree with the argument of these numbers, not necessarily constituting fundamentally a strong picture in relation to co's overall health. After all, Saks PEG stands at 1.43 however, I think this is a good relative long-term entry ; in light of management's efforts to turn the tide around in their favor. Saks has reported encouraging results over the last few quarters.

The company has invested efforts and resources in rebuilding the brand and getting rid off unwanted assets eating into their revenue line. Operating margins need to definitely improve from present levels of 1.76% ; and I believe we will start seeing improvements and sales growth over the next several quarters.

The luxury retail usually remains relatively unaffected by consumer spending slow-downs. Holding this ticker for a possible end of fiscal '07 run to over $23 levels.


ron

• http://wallstreetpit.com/

Not so fast trashing it by downgrades

Apple [AAPL] downgraded to Equal Weight, from Trip Chowdhry, Global Equities Research with a new $130 price target. “Our research indicates that upside to Apple’s iPhone is somewhat muted…Apple’s iPhone is suffering from significant strategic and tactical missteps and Apple is probably unlikely to achieve the stated 10 million unit goal by the end of 2008.”
_

I’d give Jobs, the benefit of the doubt here, without jumping the gun into any conclusions yet. So far, under his brilliance, company has performed extremely well by saturating shareholders with awesome pps levels. Let see how this thing will evolve from here. Regardless of stock ' slide of $3 into today's opening session, fundamentally company remains on solid grounds. Patience is a virtue.



ron
www. wallstreetpit.com/forums

AAPL open letter to iPhone customers from Steve Jobs

AAPL said it will give every existing iPhone customers $100 store credit. The stock has dropped over $2.00 since the headlines were published...

Highlights from Steve Jobs' letter to iPhone customers are as follows:

"I have received hundreds of emails from iPhone customers who are upset about Apple dropping the price of iPhone by $200 two months after it went on sale. After reading every one of these emails, I have some observations and conclusions. First, I am sure that we are making the correct decision to lower the price of the 8GB iPhone from $599 to $399, and that now is the right time to do it. iPhone is a breakthrough product, and we have the chance to 'go for it' this holiday season. iPhone is so far ahead of the competition, and now it will be affordable by even more customers.

It benefits both Apple and every iPhone user to get as many new customers as possible in the iPhone 'tent'... Our early customers trusted us, and we must live up to that trust with our actions in moments like these.

Therefore, we have decided to offer every iPhone customer who purchased an iPhone from either Apple or AT&T, and who is not receiving a rebate or any other consideration, a $100 store credit towards the purchase of any product at an Apple Retail Store or the Apple Online Store.

Details are still being worked out and will be posted on Apple's website next week. Stay tuned. We want to do the right thing for our valued iPhone customers.

We apologize for disappointing some of you, and we are doing our best to live up to your high expectations of Apple."




ron
wallstreetpit.com/forums

Apple comments

I am strongly biased to the upside of this stock however, and in response to the negative sentiment planted yesterday as result of PR - trying only hypothetically at this point and project, how this news will impact stock’s pps honestly, it is counter-productive. Only arguing my point, and very respectfully here i might add on the basis that ; none of us know for sure nor do we have the exact numbers , effecting aapl’s revenues - to come to a conclusion as to the impact this latest development will have in relation to stock’s pps or company books.
It is s a known fact of complexity being an exponential function. Based on this principle, unless we get a clean - revenue minus expense equals profit type deal from Jobs on this price cut, only then projections imho, should start gettin thrown around, not b4. We are literally blind and in no position to predict anything whether we’re talking stock trend, operating margin and so on.


ron
www.wallstreetpit.com/forums

Apple Stock Slides On Stunning iPhone Price Cut

Apple cuts iPhone price to $399, drops 4GB model

Apple surprised the audience 9/5 at its "The Beat Goes On" event with a dramatic reduction in price for the iPhone. Effective today, the 8GB model that was previously on sale for $599 will now sell for $399; no word has yet been received about the 4GB model, which is now expected to be phased out in favor of the 8GB version.