On Friday, Nisun International Enterprise Development Group Co., Ltd (NISN) rose 52% to $9.15 after releasing its 2023 annual results. These results are spectacular in terms of revenue growth and EPS generation. In addition to that, the company is trading below cash and book value. This deal seems too good to be true, but it isn't. NISN is likely the most undervalued stock in the world. With only 4 million shares outstanding and a 3 million float, this one could be the next Asian HKD-like runner, except with the numbers to back it up. This stock fundamentally justifies a price over $50. As it has risen from less than $4.00 at the start of the month, it might finally be getting the recognition it deserves. If you like our picks you can follow this blog by clicking the follow button on the top of the left hand panel. We have 1015 followers on here as well as 120 followers on our Canadian blog. You can also follow us on Twitter @StockTradePicks which has over 5,000 followers.
From the news release:
Nisun International Reports Financial Results for Fiscal Year 2023
Nisun Achieves 65% Revenue Growth and Ends the Year with $29.0 Cash Per Share
Shanghai, China – July 12, 2024 – Nisun International Enterprise Development Group Co., Ltd. (“Nisun International” or the “Company”) (NASDAQ: NISN), a technology and industry driven integrated supply chain solutions provider, today announced its financial results for the fiscal year ended December 31, 2023.
Financial Highlights:
| ● | Revenue: Total revenue for the year was $386.7 million, representing a 65% increase compared to $234.2 million in 2022. |
| ● | Gross Profit: Gross profit increased to $40.0 million from $37.0 million in the previous year. |
| ● | Net Income: Net income for 2023 was $17.7 million. |
| ● | Cash and Cash Equivalents: The Company ended the year with $114.5 million in cash and cash equivalents. |
| ● | Earnings per Share (EPS): The Company reported earnings of $4.46 per share, with a cash per share value of $29.0. |
CEO’s Comments:
Xin Liu, CEO of Nisun International, commented, “We are thrilled to report another year of outstanding financial performance, underscoring the success of our strategic initiatives and operational excellence. Our revenue growth of 65% is a testament to our robust supply chain solutions. We have made significant strides in expanding our supply chain capabilities, diversifying into other agricultural products. These efforts have positioned us well for sustained growth and profitability.”
Mr. Liu continued, “Despite our strong financial performance, substantial cash reserves of $29.0 per share, and robust earnings, our stock trades at just over one times annual earnings by the end of June. We believe this significantly undervalues our company. The Board of Directors and I are actively considering strategic alternatives to unlock shareholder value and better align our market valuation with the intrinsic value of our company. Our strong cash position and ongoing growth initiatives provide a solid foundation for these efforts.”
Operational Highlights:
| ● | Supply Chain Trading and Solutions: Nisun International continues to enhance its supply chain trading and financing solutions capabilities, leveraging state-of-the-art technology to streamline operations and reduce costs. The Company successfully managed the daily supply of 3.6 to 6 million eggs to major online platforms across key regions. |
| ● | Geographical Expansion: The Company’s supply chain operations now span multiple regions, enabling delivery of a diverse range of products. This extensive network ensures seamless operations and strengthens Nisun’s market presence. |
| ● | Diversification: Nisun has expanded its supply chain solutions to include other agricultural products, positioning the Company for substantial growth in the agricultural sector. |
Looking Ahead:
Mr. Liu added, “Our commitment to innovation and excellence remains unwavering as we continue to drive growth and create value for our shareholders. The strategic expansion of our supply chain solution will enable us to meet the evolving needs of our customers and capitalize on new market opportunities. We are excited about the future and confident in our ability to achieve even greater success.”
Revenue growth was 65%, EPS was $4.46 and cash per share is $29. Working capital is $182.2 million, or over $45 per share. There is absolutely no reason for this stock to be trading less than $50, at that would imply a P/E ratio of just 11x and trading at barely over 1x of its working capital. With the CEO and Board of Directors looking at ways to maximize shareholder value, they could easily enact a buyback plan or special dividend that sends the stock flying while putting hardly a dent into the substantial cash balance.
Despite numerous Chinese and Asian-based pumps going to insane valuation levels, this stock appears to suffer from a lack of visibility or people just think there is something fishy going on, despite having a PCAOB-compliant audit. However, with the financials showing the business growth is strong, fundamental valuation is very cheap, the leadership team is looking to unlock greater shareholder value, numerous Chinese stocks rising to insane levels and that NISN has only a 3 million float and generally trades only a few thousand shares each day, this is an ideal play to look for a 5x to 100x bagger.
Disclosure: We are long NISN
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