Boston, MA 03/11/2014 (wallstreetpr) – CNinsure Inc. (ADR) (NASDAQ:CISG) released its fiscal 2013 fourth quarter Monday. The results for the quarter were mixed as they ended up showing growth and decline in some key metrics. Yet, shares were in a tear, touching a fresh one-year high.
The heavy volume trading Monday saw shares of CNinsure Inc. (ADR) (NASDAQ:CISG) rise 6.42 percent to $7.79 by bell time. But before then, the shares had soared to attain a new 52-week high at $7.87.
It baffles that shares were up yet the company didn’t impress in its latest performance score card, especially looking at the earnings per share column. Could anything be the matter? We answer the question in the most straightforward manner.
A promising future
CNinsure Inc. (ADR) (NASDAQ:CISG) announced that although its revenue in the fourth quarter was up by 15.6 percent to $83.2 million, it was difficult to come up with strong earnings as was expected. Thus, the insurance intermediary operator announced earnings per share of 8 cents, which was below the 10 cents that analysts had hoped for.
But then, even with the weak EPS, the management is convinced the business is in good health. So then, they have estimated revenue will grow in the first quarter by 15 percent over the same duration in 2013. Thus, investors’ concern was addressed as the company issued a widely strong outlook for the current quarter.
For a turnaround stock like CNinsure Inc. (ADR) (NASDAQ:CISG), investors are always more concerned about what the future looks like than the present figures.
Management comment
CNinsure Inc. (ADR) (NASDAQ:CISG) management was more than pleased by the results they issued for the fourth quarter. The company’s chief executive Chunlin Wang cited that they were executing well in expense management and that their expense to revenue ratio had dropped significantly year-over-year. With drop in expenses, the company is looking at improving profits going forward.
Bottom line
CNinsure Inc. (ADR) (NASDAQ:CISG) may not have come up with the expected results in the just reported quarter, but its disciplined cost management and declining expense-to-revenue ratio are reasons enough to have faith in what the management is doing. And this can only mean big reward for investors.
