Wonder Auto Technology, Inc. (WATG) is a leading manufacturer of automotive electrical parts, suspension products and engine accessories in China. With a gain of more than 12%, this company is one of the top-performing Zacks #1 Rank stocks on Thursday.
The Chinese government has initiated a number of stimulus policies to help out its auto industry, and WATG has capitalized. In addition, the company outlined a few other growth drivers in its solid first-quarter report from early May, including a market-oriented focus on products such as alternators and starters; new joint development programs (there were 17 in the quarter); and strategic acquisitions.
The company is part of the auto/truck-orig industry. Out of 226 stocks on today’s Zacks #1 Rank List, there is only 1 other from that space: Modine Manufacturing Company (MOD).
Estimates Up in Past 2 Mos.
Analysts currently expect earnings per share of 82 cents for this year. Two months ago, the consensus was at 76 cents, accounting for an advance of nearly 8% in that time.
Meanwhile, estimates for next year moved higher 6.6% to 97 cents from 91 cents. Therefore, at the moment, analysts expect profit to grow more than 18% in 2010 over 2009.
High Demand Boosts Q1
Earnings per share reached 19 cents during the quarter. Both the year-ago result and the consensus were at 15 cents, marking advances of nearly 27% in both cases.
Sales jumped 28.5% to $40 million from $31.1 million, reflecting, in large part, the acquisition of Jinan Worldwide.
Qingjie Zhao, chairman and CEO, expects momentum in the Chinese auto industry to continue, and believes that WATG is in a good position to capitalize.
“Looking forward, we remain optimistic about the growth potentials from our internal competitive advantages and the external opportunities from the bolstered auto market in China,” he said.
