Under the Radar: China's Biggest Drugstore Chain Looks Cheap
Such episodes have led many Chinese families to now turn to China Nepstar Chain Drugstore (NPD), China's largest retail drugstore chain. The company has become a trusted site in many urban neighborhoods much the way Americans trust the products they buy at stores such as Walgreens (WAG) and CVS (CVS).
Plus, the company is moving into a growth business: filling prescriptions. Until recently, most Chinese would fill their prescriptions at the hospital. But that is quickly changing.
Hilary Kramer, editor of GameChangerStocks.com, says that Nepstar is a buy for those reasons. She also likes the company's owners, Neptunus Group and has had her eye on the stock for some time. The stock has fallen about 59% since the beginning of the year, due to rising wage and rent expenses, but the company now has a new CEO and is taking steps to put cost controls underway.
Along with the growth opportunities, the new CEO and control on costs, Kramer also says that the company recently declared a buyback, and is repurchasing up to $20 million worth of its shares over the next 12 months which will give support to the stock. In addition, the NYSE traded shares sport a 9% dividend yield.
Kramer's six month target: $3.50 per share, an increase of about 12%.