Fuwei Films (Holdings) Co., Ltd (NASDAQ:FFHL)

I'm holding on to my underperform call.

Revenues may be up for 2008 vs 2007, but gross profit is down due to increased operating expenses and rapidly rising SG&A expenses.

All of that leads to a decrease in EPS of 42.4% in the first six months of 2008 as compared to the same period for 2007. It's not turning out to be a good year for this company.

Fuwei Films is a very difficult company to get a grasp of largely because its earnings were heavily skewed in 2006 due to a one time $2.80 per share benefit, and in 2007 they drastically reduced the amount of shares outstanding. This isnt to say that Fuwei isnt growing revenue because 20-30% per year is nothing to sneeze at, but some of these earnings per share figures are sort of non-comparable. Despite all that, it leaves us with a very healthy company at 1.8 times book, 2 times sales, and a (though non-comparable) 2 times future price to earnings which is so low its embarassing. Its an Asian company, Asia is hot right now, and the stock has plenty of supoport in the $6-7 range. No reason this cant see the double digits again in a year's timespan.

Nero

Sagetrade