Chinese growth stocks were on fire last week.
There were plenty of stocks from the world’s most populous nation putting up double-digit percentage gains.
Are investors finally ready to buy back into China? Are the high growth rates and low multiples e (NYSE:DANG)nough to outweigh the geopolitical risks of buying into Chinese growth stocks?
Let’s take a closer look at some of the winners from last week.
|Company||May 10||Weekly Gain|
|Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP)||$29.38||30%|
|China Mobile Games & Entnmnt Grp Ltd (NASDAQ:CMGE)||$15.40||25%|
|E Commerce China Dangdang Inc (ADR) (NYSE:DANG)||$4.62||19%|
|Sohu.com Inc (NASDAQ:SOHU)||$60.70||17%|
|Baidu.com, Inc. (ADR) (NASDAQ:BIDU)||$95.45||13%|
Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP) runs the leading travel portal in China, and the stock took off last week after blowout quarterly results.
Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP)’s revenue soared a better-than-expected 27% during the quarter, and its guidance for 15% to 20% in top-line growth for the current quarter was also encouraging. Profitability did slip as margins contracted, but even there Ctrip was a winner. Its quarterly profit of $0.18 a share was 50% ahead of where the pros were perched.
China Mobile Games & Entnmnt Grp Ltd (NASDAQ:CMGE) has quietly become one of this year’s hottest stocks, nearly quadrupling so far in 2013. The speedster commands the largest market share in terms of revenue among mobile game developers. There was no material news during the week, but China Mobile Games & Entnmnt Grp Ltd (NASDAQ:CMGE) announced three new games this morning.
E Commerce China Dangdang Inc (ADR) (NYSE:DANG) is one of the country’s most prolific online retailers. E Commerce China Dangdang Inc (ADR) (NYSE:DANG) introduced a daily deals channel earlier this month, but investors are buying in these days hoping for a strong quarterly report this week. E Commerce China Dangdang Inc (ADR) (NYSE:DANG) is expected to post a narrowing deficit on a 25% surge in sales when it reports on Thursday.
Sohu.com Inc (NASDAQ:SOHU) is one of the more seasoned publicly traded Chinese equities. Sohu.com Inc (NASDAQ:SOHU) is best known for its online portal, but it has grown over the years to spearhead the fast-growing Sogou search engine and a magnetic video-streaming website.
Finally we have Baidu.com, Inc. (ADR) (NASDAQ:BIDU), posting its best weekly gain in nearly a year after announcing the acquisition of PPS.tv. The $370 million deal positions China’s leading search engine as a major player in video. Sure, video will never be as lucrative as Baidu’s high-margin paid search stronghold, but the key here is that the business is incremental. Baidu.com, Inc. (ADR) (NASDAQ:BIDU) will also be able to sell a broader array of only advertising products to its clients.
Betting on China
There’s plenty of growth still to be had if you buy the right Chinese growth stocks.
The article 5 Chinese Stocks That Soared Last Week originally appeared on Fool.com and is written by Rick Munarriz.
Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Baidu, Ctrip.com International, and Sohu.com. The Motley Fool owns shares of Baidu and Ctrip.com International.
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