China medical equipment company China Kanghui Holdings (
KH
,
quote
) is a highly profitable business - and
much more attractive than better-known
competitors
such as Boston Scientific Corporation (
BSX
,
quote
).
Based in Changzhou, this China medical equipment company
develops, manufactures and sells orthopedic implants and related
products, with an emphasis on spinal and trauma equipment. The
holding company operates through two wholly owned
subsidiaries, Changzhou Kanghui Medical Innovation Company
Limited and Beijing Libeier. Its two brands are Kanghui and
Libeier. Chief executive officer Libo Yang joined China Kanghui
after stints at Schlumberger and a Chinese unit of Johnson &
Johnson.
Compare China Kanghui's 37.35% profit margin with Boston
Scientific's negative 43.37%.
As to be expected from such a high profit margin, earnings are
very strong for China Kanghui. Earnings-per-share growth is up
for the year by 196.24%. Sales growth is up for the quarter by
21.68%. On a quarterly basis, the China medical equipment
maker's earnings per share are rising by 31.62%. Over the next
five years, earnings per share are expected to expand by 20.47%.
That is a very bullish trend.
The China medical manufacturer was founded in 1997. Today
China Kanghui produces a wide variety of orthopedic implants and
boasts an extensive network of distributors that extends
throughout China and to 28 other countries. Hospitals around the
world use its products.
China Kanghui serves a
huge growth area
in an even bigger expanding market, the emerging markets consumer
class.
Even during the Great Recession, the middle class in emerging
market countries continued to grow. As these consumers become
more affluent, they are
spending more on health care
. In addition, policymakers in Beijing have targeted health care
spending as an area of economic growth in the domestic
market.
Now trading at about $22.52,
China Kanghui Holdings has a mean analyst target price
over the next year of $24.21
. The stock has a bullish mean analyst rating of 1.60.
