China Automative Revs Up Its Engine Again!

China Automotive Systems Inc (Nasdaq CAAS) is up about 10% and has made the top 10 gainers list on Nasdaq. The stock broke above $10 for the first time for a long time. China Automotive made a big run up to $16 last time and it's leading the Chinese related auto stocks. The stock has traded 1.6 million shares today which is its entire float and it's only been 1 hour into the trading day, so it has revved up its engine again.

I checked out the China Automotive website. The company is based in Jinzhou. They have some very strong partnerships with the big auto makers in China - especially Chery Automotive which is their largest customer and Daimler Chrysler. Operating income doubled year over year to $6.5 million and net income was up 227% to $2.7 million. The fundamentals are very strong. It's a fairly impressive performance. If this stock is anything like the other Chinese stocks during the past few weeks, we could see $20-$30. I am still amazed at the performance of China Resources (Nasdaq CHNR) which I wrote about just last week in a piece called "The Real Reason China Resources is Going Up". The stock was trading at $14 a week ago and today it is $37! Up up and away!

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