Agoracom Blog

Chinese Small-Cap Company Feature: Sinovac Reports 606% Net Income Increase On H1N1 Vaccine

Posted by AGORACOM at 8:15 AM on Wednesday, November 18th, 2009

As many of you know, we are very bullish on the long-term future of Chinese small cap and mid cap companies for two reasons:

1] The obvious reason – China is the fastest growing economy on the planet and nothing is going to slow down its ascent over the next 50 years and beyond. Investing in growth companies there just makes too much sense.

2] Great Results and Valuations – Many Small Cap Chinese Companies are listing in the US (OTCBB, NYSE Alternext and NASDAQ) with great financial results. Unlike many dubious US Small Cap Companies, Chinese Companies don’t seem to believe in losing money or failing to execute in a business plan. As such, 7-digit revenues and profits are very common.

From a valuation point of view, many Chinese companies became a victim of their own success in Q4 2008 and Q1 2009. Why? When the world needed to start liquidating, one of the first places they looked were China where most investors had significant gains to sell into. This resulted in the proverbial baby being thrown out with the bathwater and some great valuations.


Sinovac (NYSEAmex:SVA)


Sinovac Biotech Ltd. is a China-based biopharmaceutical company that focuses on the research, development, manufacture and commercialization of vaccines that protect against human infectious diseases. Sinovac’s commercialized vaccine products include Healive® (hepatitis A), Bilive® (combined hepatitis A and B), Anflu® (seasonal influenza), Panflu(TM) (pandemic influenza (H5N1)), and PANFLU.1(TM) (pandemic influenza A (H1N1)).

On November 15th 2009, the Company reported it’s unaudited third quarter financial results.

Check out the full details below:

Read Full Press Release

Chinese Stocks TV Segment


  • Sales for the third quarter increased 142% to $21.2 million
  • Sales for the nine-month period increased 40% to $47.8 million
  • Operating income for the third quarter rose 436% to $12.4 million
  • Operating income for the nine-month period increased 90% to $23.7 million.
  • Net income attributable to the shareholders increased 606% to $5.2 million in the third quarter, with diluted EPS of $0.12
  • Cash and cash equivalents at September 30, 2009 was $46.6 million.


We’ve provided investors with two great starting points to research great Chinese small cap and mid cap companies.

1. – tracks 250 of the best small cap and mid cap companies trading on North American exchanges. It provides you with the best of the best in two ways. First, the front page lists the best news of the day coming out of the space. It does so by giving you a text view of the best press releases by industry and via Chinese Stocks TV, a 5-minute broadcast every morning just after the open. Chinese Stocks TV is archived, so you can catch up on shows you missed.

Second, if you want to research each of the 250 companies to find candidates for your portfolio, it has a very intuitive directory that lets you quickly review each company on the master list, or parse it out by industry and exchange if you have a particular sector of interest. Cool stuff.

2. Right here on AGORACOM, you can refer to our China category for other featured Chinese Small-Cap Companies. As always, we will disclose any IR relationship with any public company. Given the sheer number of great Chinese Small-Cap Companies out there, you can expect us NOT to have an IR relationship with most of these companies.


2 Responses to “Chinese Small-Cap Company Feature: Sinovac Reports 606% Net Income Increase On H1N1 Vaccine”

  1. AGORACOM says:

    Hi, Richard and thanks for the great post. I just stumbled upon Sinovac, so I can’t tell you specifically why the price has dropped to this current range. I feel fortunate to have discovered it after the pull back.

    Having said that, I can definitely see how SVA could have been driven to $9+ by speculators and hype around H1N1. If the problem got out of hand, companies like SVA could have just taken off. Fortunately for the rest of society, that hasn’t happened and concerns about it appear to have stabilized. That probably accounts for the recent share price dip.

    If news about H1N1 heats up, I’m willing to bet Sinovac shoots right back up again.


  2. Richard says:

    I have been invested in SVA for some time and the other day it was over $9+, since then the price has fall to around $7+. It is my understanding this company has most of the market for H1N1 in China. China having a population of over 1 billion and only 6 million does to date have been produced, there is certainly a short fall in innoculating the population. Just have furnished vaccine for another diagnosis, the question is, why is this stock selling off? It just moved to the NASDAQ, it has requested additional shares and the it looks like the 3rd quarter will double the estimates. Again, why? Thanking you for your comments.
    Richard Kast