China Growth Stocks

[Risicare]

Pennyprophets paid pump for Monday (released just a few hours ago), no wonder why all the posts about it all of a sudden....... DId you really read the NYT article or just the pump email? LOL

http://investorshub.advfn.com/boards/msgsearchbyboard.aspx?boardID=9884&srchyr=2009&SearchStr=cedt

Their revenue dropped considerably


Hello Everyone,

My new big pick is China Education Technology, Inc (OTCBB: CEDT)

As I mentioned in my previous email, China's stimulus package is fueling an economic recovery at a phenomenal rate. China is currently the third largest economy in the world, and many analysts have forecasted China could grow to be the largest economy in the world in less than a decade.

In THIS New York Times article, The World Bank is the latest major institution to raise their forecast for China's economy. The bank expects China's economy to grow 8.7% next year.

The Chinese rebound is fueled by a 4 trillion yuan, or $585 billion dollar stimulus package that was announced last year. Part of this stimulus is to reform education and innovate technology.

A breakdown of the 4 trillion yuan stimulus spending package can be seen here:

http://www.eeo.com.cn/ens/finance_investment/2009/03/07/131626.shtml

As you can see on the graphical pie chart, 9% of the stimulus will be spent on Technology Advancement and 4% on Educational and Cultural Projects. If you combine both, a total of 13% of the $585 billion dollar stimulus will be spent on these two sectors alone.

Back in 2008, when the Chinese stimulus package was announced, The Chinese government drew up a 12-year plan on education reform and development, stressing its role in promoting economic development and technology innovation. SOURCE

This is where CEDT comes in, and this is why I am speculating that China Education Technology, Inc. could be the perfect opportunity to take advantage of the accelerated growth of China's economy and the future potential of Chinese-based companies.

CEDT engages in the research and development of educational products and technology applications. The company's products are divided into four categories, which include information collectors; sensors; digital meteorological stations on campus; and digital analyzing software.

For the full CEDT company profile, please see their BusinessWeek profile HERE

CEDT is a leader in school lab experiment products. CEDT recently announced they have designed a new generation of a data collector and sensor and is now applying for 4 utility model patents, 5 design patents, and 2 software copyrights. This newly developed product will mainly be used by students of grades 7-12 and may bring $7.4 million (RMB 50 million yuan) of sales for CEDT with a profit of $2.2 million (RMB 15 million yuan) in the next two years. CEDT is the only company who is subsidized by the State Science and Technology SOURCE

China Education Technology, Inc. has been able to grow revenues from $1.1M to $2.9M year over year. Most impressively, the company has been able to reduce the percentage of sales devoted to cost of goods sold from 80.03% to 49.02%

I truly believe the future of education is going to be fueled by the advancement of technology and modernizing the typical classroom with hi-tech equipment and devices. The 12-year education reform plan by the Chinese government, combined with 13% of the stimulus plan being spent on Technology Advancement and Education, potentially positions CEDT to acquire large contracts in the future and continue its year over year growth.

Start researching CEDT and put it on your radar. At a market price of less than $0.11/share this company is trading at a discount in my opinion. The 52 week high from May 27th, 2009 is $1.53/share. This represents a potential ROI of 1316.66% from Friday's closing price of $0.108/share !!

You may also want to keep in mind President Obama is in Asia this week. There is a possibility that news regarding US and China based relations could stir speculation in the market regarding Chinese-based equities.

As always, please use this material as a supplement to your own research and due diligence.

Regards,
The Penny Prophet
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