CMED Catches Aggressive Bids On Strong Earnings

China Medical Technologies Inc. (CMED) continues to surge higher Wednesday on good breakout trading volume. More than 1.6 million shares have already traded hands compared to a daily average of around 233K. The ticker is currently up by 20.32% on the heels of its 2Q10 results.

Early this morning, CMED said the company posted a second quarter net loss of $442K, narrower than $7.4 million in the prior year period. CMED also said it saw its 2Q revenues increase by 21.5% on a YoY basis to $30.2 million.  Meanwhile, the co.’s Q3 adjusted earnings per ADS are expected to be not less than $0.42, and revenues to be not less than $32.9 million, representing a YoY increase of not less than 27.7%.

Technically speaking, the shares of CMED continue to catch aggressive bids intraday as the stock jumps to its September highs. While the ticker has underperfomed the broader SPX by 22%, it recently was able to bounce off the $11.50 level where it found support. It remains to be seen if CMED will maintain its PPS above the 2-month $11.50 -$12.50 range. If it can maintain it, and this depends if overall action in DOW remains constructive, it might be enough to lead its price to a further extension.

CMED currently trades at a forward multiple of 7.47 and a P/E to growth ratio of 0.31. The stock has been moving relatively higher over the past four months, and is currently trading above the 50-day ; $12.34, and 200-day ; $12.18, moving averages.

China Medical gained $2.43, or 20.65%, to $14.20 rtq. at 2:02 E.T. in Nasdaq composite trading.

About Ron Haruni 1033 Articles
Ron is the Co-Founder & Editor in Chief of Wall Street Pit. Web Site: Wall Street Pit

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