VanceInfo Is China’s Version of InfoSys
Trader Mark submits:
I’ve had VanceInfo Technologies (VIT) in my pool of "up and coming companies to keep an eye on" for about 4 months now; last week Investors Business Daily did their (as usual) excellent summary of a company, so this would seem a good time to introduce the stock to the website. This is quite an interesting concept, as its a similar niche to the Indian outsourcing companies that broke onto the scene the past decade – led by powerhouses such as Infosys Technologies (INFY). While comparing the 2 companies is a huge stretch (INFY $5B in annual revenue, VIT $150M), anyone who invested in INFY in 1999 when it was (split adjusted) $5-$6 has made a pretty penny since. From an economics perspective, I will be interested to see if the Indian outsourcers face the same sort of global wage / cost arbitrage in the next 10 years, that we are seeing in the US, as the Chinese undercut them on price / labor.
Technically, the stock is not in a place to be buying, so for now it remains on the ‘watch’ list; VanceInfo Technologies reports Friday. With a longer term projected growth rate of 30%, and earnings projected for the year at 51 cents. The price of $17 has accounted for much of that growth; the stock is quite rich up here. But it was even richer just a month ago north of $21.
Investing, Long Term Investment, stock market | admin February 16, 2010
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