American Dairy Inc.

American Dairy Inc. (ADY) just received a big upgrade from the analyst community, with its next-year earnings growth projected at 34%.

Company Description

American Dairy operates in China under the umbrella of its parent company Feihe Dairy. The company specializes in producing milk powder and soybean products and has a market cap of $729 million.

First-Quarter Results

American Dairy's share price has been on fire since the company reported gang-buster first-quarter results on May 14 that were ahead of expectations.

Sales were up 191% from last year to $113.8 million. Income was up 282% to $27.8 million, producing earnings of $1.55 per share.

CEO Leng You-Bin said that the company's results were boosted by the melamine crisis in China, pushing consumer towards its products. Mr. You-Bin went on to say that he expects the company's long-term growth rates to return to a normal level in coming quarters.

Estimates Spike

After the solid quarter, analysts raised their earnings forecasts, with the current-year estimate more than doubling to $3.34 per share. The next-year estimate is up to $4.49, a 34% growth projection.

The Chart

Shares of ADY have been rallying since news of the great quarter hit the Street, advancing from $17 to a recent high above $43. Take a look at the big move in the chart below.

Read the full analyst report on ADY