Back to top

Value

Zacks Equity Research

Hollysys Automation Technologies

HOLI

 ZacksTrade Now

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Hollysys Automation Technologies, Ltd. (HOLI - Snapshot Report) has gained nearly 12% since its quarterly results on August 14, which included an encouraging revenue outlook for fiscal 2013. With a price-to-book (P/B) ratio of just 1.6 and a Zacks #1 Rank (Strong Buy), this provider of automation and control technologies presents a true value option for investors.

Strong Revenue for Fiscal 2013

Hollysys Automation Technologies reported fiscal fourth quarter 2012 earnings per share of 21 cents, up 75% year over year but a penny short of the Zacks Consensus Estimate.

Revenue spiked 23% to $88.1 million on the back of healthy growth in the Industrial Automation and Overseas businesses, which accounted for roughly 58% and 8.4% of total revenue, respectively. Backlog in the quarter grew 31.5% to roughly $390 million. Gross margin improved to 41.4% from 28.8% in the year-ago quarter.

For fiscal 2012, earnings per share came in at $1.01 versus 75 cents in fiscal 2011, while revenue settled at $321.7 million compared with $262.8 million in 2011.

Driven by impressive fiscal fourth quarter results and a strong backlog, management projected fiscal 2013 total revenue of $385 million to $410 million with net income of $63 million to $67 million. At mid-points, the revenue guidance suggests year-over-year growth of 23.6% while the net income guidance suggests 15.7%.

Earnings Estimates Move Higher

Over the last 30 days, the Zacks Consensus Estimate for fiscal 2013 has advanced by 4.5% to $1.16, while the Zacks Consensus Estimate for fiscal 2014 moved up 1.6% to $1.25 per share. These outlooks represent year-over-year earnings growth of 14.4% for fiscal 2013 and 8% for fiscal 2014.

A Value Play

In addition to a low P/B ratio, Hollysys Automation Technologies is currently trading at a forward P/E multiple of 8.1, compared with the peer group average of 14.1. A P/E ratio below 15.0 and a P/B ratio under 3.0 generally indicate value.

The chart below clearly shows that the stock gained momentum following the first calendar quarter of 2009, and since then has reached new highs. Growth prospects appear bright and are backed by the rising Zacks Consensus Estimates.

Hollysys Automation Technologies is headquartered in Beijing, China, and was founded in 1993. The company makes automation and control technologies for several industries in China and other parts of Asia. Customers are in the industrial, railway, and nuclear industries. Currently, the company has a market capitalization of approximately $526.4 million.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%