China’s HollySys (HOLI)
has continued to outperform its peers in 2018, though HollySys too had
been drifting lower since early March. With strong orders in the
automation business in the March quarter, though, it looks like
investors feel a little more confident in the prospects of HollySys
continuing to penetrate new markets in its core China market.
Consistent
execution has long been a challenge for HollySys management, and the
situation is not helped by volatile ordering patterns from its primary
rail customer. That said, the company has been expanding its automation
product offering and continues to gain business in new market verticals.
While the shares don’t look like a particular bargain relative to the
underlying risks, high single-digit revenue growth should support
double-digit returns for shareholders.
Read more here:
Strong Orders Drive A Rally For HollySys
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