Why Investors Are Not Happy With China New Borun Corp (NYSE:BORN)?

Posted by George Brook March 17, 2014 0 Comment 862 views

Ever since corn based beverages major China New Borun Corp (NYSE:BORN) declared its fourth quarter and full year operational results on 6th March, the stock has been under the pump at the markets, after a initial bull run which could not be sustained. The investor community have continued to stay away from the stock, leading to a substantial 16 percent dip in its market value over the past five days of trading. This lack of investor confidence in the stock of this China based firm culminated in a 4.3 percent dip in value during trading on 14th March.

Impressive 4Q Gains In Revenue, Profits and Income

For the reporting quarter, China New Borun Corp (NYSE:BORN) revenue went up by 30.7 percent in comparison to 4Q12 to reach $107.9 million, while its net income was up by 41.1 percent for the same time stamp compare to reach $5 million. Gross Profits also saw an impressive 44.3 percent increase on a 4Q12 compare to reach $12.9 million. The brewery operator also disclosed that its new plants construction project was successfully completed during the reporting quarter.

Guarded Guidance For 2014 Operations

 China New Borun Corp (NYSE:BORN) Chairman of the Board and Chief Executive Officer Jinmiao Wang also provided a guarded guidance for his firms fourth quarter operations. He is said to have sounded caution about the demand and supply situation which would evolve in the near term for edible alcohol products and has been quoted to have said that, “We will continue to optimize our strong sourcing capability and strive to achieve greater operating leverage in our core business.  At the same time, we are excited about ramping up sales and production of our newly-introduced CPE and foam insulation product lines. We anticipate material contributions from the new business beginning in the second half of 2014.”

About George Brook

George Brook covers money and politics for GDP Insider. George is a veteran journalist who has also covered Congress, national political conventions and presidential politics. George also covers the White House as well as economic and domestic policy for GDP insider. George's reporting has won numerous awards, including two Scripps Howard awards, two National Headliners, two Gerald Loeb Awards, as well as honors from Sigma Delta Chi and the National Press Club.

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