For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Best Stocks for 2008 report.
"Our top speculative idea for 2008 is China Direct (ASE: CDS)," says Jim Trippon, editor of The China Stock Digest. "China Direct is an aggressively expanding US-based firm that has grown exponentially over the course of the past year -- from a start-up with meager profits to a thriving concern with a sharp revenue growth curve. Share prices are following suit.
"China Direct's management division acquires controlling stakes in Chinese companies and then provides investment capital and active management. Its consulting division assists other companies in China and the US in establishing and maintaining a presence in the US capital markets.
"The company says that, as a direct link to China, it serves as a vehicle allowing investors to directly participate in the rapid growth of the Chinese economy in a diversified and balanced manner.
"It credits its sharp rise in revenues to three recently acquired Chinese companies, Chang Magnesium, Lang Chemical and CDI Wanda, as well as a strong performance from China Direct's consulting division.
"The firm has established an admirable track record for bringing small and mid-sized Chinese firms to American markets. And the addition of new manufacturing operations is likely to enable China Direct to generate healthy revenue and net income growth in the forthcoming few years.
"Most recently the company acquired 100% of Xiangxi Autonomous Prefecture Jixiang Mining Industry Co., Ltd, a business that mines, processes and distributes concentrated zinc and lead. The preliminary reporting from China Direct's engineers estimates that the zinc and lead reserves contained in the land covered by the mining rights are worth up to $54 million at current prices."
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