Xinyuan Real Estate (XIN)

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Xinyuan Real Estate (XIN) - A value and growth investment.

Xinyuan Real Estate is a Chinese residential real estate developer that specializes in building high rise apartment buildings and multi-layer apartment buildings. The company became the first Chinese real estate developer to have an initial public offering on the NYSE as it raised $245 million in December 2012. As it stands the company currently trades with an insulting market capitalization of $251 million as of April 20. The company recently posted its 2011 figures that show a 53% increase in revenue reflecting $688 million with a strong net income of $102 million. On a per ADS basis, the earnings more than doubled from 2010 jumping from $0.66 to $1.36. Additionally, the company raised its dividend 60% going forward from $0.10 to $0.16. Fears of a Chinese real estate crash and a depressed market for Chinese companies trading in America in light of reverse-merger fraudulence have unfairly hurt Xinyuan since its IPO at the start of the Great Recession.

The company's advantage is that it that it focuses on Tier II cities in China, the cities that have not fully developed into the giant cities expressed in Tier 1 cities. These cities are more likely to experience continued rapid growth and are less likely to be affected by government regulations that are designed to cool down overdeveloping construction. As the largest fear in the Chinese market rests in a crash of a hot real estate market that has been booming, Xinyuan has been disproportionately discounted in light of this unique advantage built into its business model. As it stands, the company actually has more cash on hand than its entire market capitalization is currently valued a