51job, Inc. (JOBS) more than tripled in 2009, rising on the strong Chinese economy and strong results from its online recruitment services.
Company Description
51job, Inc. provides integrated human resources services such as staffing and financial planning in China. The company was founded in 1998 and has a market cap of $482 million.
Third-Quarter Results
Revenues were up 5.1% from last year to $32.2 million. Earnings also came in strong at 19 cents per share, 12 cents ahead of the Zacks Consensus Estimate. The company has surprised in each of the last 3 quarters by an average of 249%.
51job’s saw big gains in its online recruitment services, with revenue up 16% to $13.2 million. Other human resources revenues increasing 8.6% to $7.7 million. The laggard of the group was 51job’s print advertising segment, where revenue was down 7.2% from last year to $11.3 million on lower volume.
Gross profit was up 24% from last year to $19 million, with gross margin jumped to 62.4% from 52.7%. cash and short-term investments totaling RMB1,173.9 million (US$172.0 million)
Shares Repurchased
51job bought back the equivalent of 547,126 common shares totaling $3.3 million during the quarter, bringing the total number of shares bought since the inception of the $25 million program to 1,589,210, or $7 million.
Estimates
Estimates have been a bit mixed over the last few months, with the current year up 17 cents to 43 cents. The next-year estimate is down 10 cents in the same time to 56 cents, but still projecting 31% earnings growth.
After the recent gains, this stock doesn’t come cheap, trading with a forward P/E of 41X, a sharp premium to the overall market.
The Chart
Shares of JOBS recently pulled back from the 52-week high at $20.50 after spending most of 2009 trending higher. Look for long-term support along the trend line, take a look below.
Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Surprise Trader Service. Zacks Investment Research
