"Sunwin International Neutraceuticals (OTCBB: SUWN) engages in the areas of essential traditional Chinese medicine, zero calorie natural sweetener (Stevia), and veterinary medicines and feeds prepared from 100% organic herbal ingredients. As an industry leader in agricultural processing, Sunwin has built an integrated global firm with the sourcing and production capabilities to meet the needs of consumers throughout the world. Sunwin also makes such value-added products as specialty veterinary food ingredients and specialty feed ingredients. The Sunwin family works closely with consumers to provide a quality and a hybrid mix of agricultural products and services that meet growing demand. For more info about Sunwin, please visit http://www.sunwin.biz"
"Sunwin Stevia International Corp., a wholly owned subsidiary of Sunwin International Neutraceuticals, Inc. (OTCBB: SUWN), engages in the distribution of Stevioside, under the Only Sweet(TM) line in North America. For more information about Only Sweet(TM), please visit http://www.onlysweet.com."
200M Authorized Shares 87M Outstanding Shares 26% Owned by Insiders
SUWN's Stevia Subsidiary is what excites me about this stock. Stevia is a 0 calorie, 100% natural sweetener, which is sold in bulk to certain international food producers and marketed in 100-count and 200-count packets (much like Sugar, Splenda, etc.). Right now, Stevia is only approved by the FDA as a dietary supplement, not as a food additive; however, it is on the grocery store shelves next to Splenda, Sweet N Low, etc. under the Only Sweet name. Not all retailers have it - Kroger is the largest national chain that does.
Where the big growth is coming is when the FDA approves Stevia as a food additive. Cargill and Coke have been leading the way to try to get this approved. Once approved, SUWN is well-positioned to take advantage of this as one of the largest Stevia producers.
Despite the pending FDA approval, revenue and income is already improving:
FY-2007 (ended 4/30/2007) Annual Revenues: $15,244,000 Net Loss: ($579,000)
FY-2008 (ended 4/30/2008) Q1 Revenue: $4,217,000 Q2 Revenue: $5,684,000 Q3 Revenue: $6,612,000 First 3 Quarters: $16,513,000 (already greater than 2007)
Q1 Net Income: $309,000 Q2 Net Income: $179,000 Q3 Net Income: $633,000 First 3 Quarters: $1,121,000 (big turnaround from 2007 net loss)
The Annual 10-K should be out by August 15th.
Per the Q3 earnings release, Sunwin is expecting RECORD RESULTS in 2009, so I thought I would calculate a possible value range based on the revenue and income trend we are seeing.
On the low end, let's assume they equal last quarter's net income for each quarter of 2009:
$633,000 x 4 = $2,532,000 net income / est. 100,000,000 OS = eps of .025
If we see RECORD RESULTS as they say, let's assume that figure is 50% higher, or an eps of .038
At the very low end: .025 @ p/e of 20 = $0.50
If the 50% growth is assumed: .038 @ p/e of 20 = $0.76
At 50% growth, a higher p/e of 40 to 60 would be possible:
.038 @ p/e of 40 = $1.52 .038 @ p/e of 60 = $2.28
Now let's assume mega growth, say 100%, with the high end p/e of 60:
.05 @ p/e of 60 = $3.00
This is a wide range, but I believe a forward-looking valuation could fall anywhere in the $0.50 to $3.00 range. At the high end of the range, we're looking at 10-bagger potential here from the current pps.
Recently, SUWN made a little move that I view as a hint of what may be soon to come. After hitting a low of $0.25, it made a run up to almost $0.40, yet got walked back down to $0.27 currently. If you look at the depth on Level 2, you will see very thin resistance. NITE is parked at $0.288 on the ASK, and next is SBSH at $0.3799! A little volume, and this will be back near $0.40, which is still very undervalued.
Following are some long-term and short-term charts:
That's the basics for now. I'd be happy to answer any questions tomorrow. For now, I'm calling it a night.
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