With a strong track record in consolidation and organic growth of its software business, we believe CDC Corporation (CHINA) is poised for growth. The 1Q 2009 revenue was below expectations, due to the global economic recession as well as a negative impact from currency fluctuations.
With a continual focus on vertical industries, cost reduction initiatives in its software segment, new launches and upgrades in its product line as well as integration efforts, CDC should develop a significant competitive advantage in 2009 and beyond. Also, increase in license bookings and strong pipeline of sales opportunities at CDC Software should drive growth.
As such, we maintain our Buy rating on the shares of CDC with a six-month target price of $2.50.Zacks Investment Research
