While the current economic crisis is muting growth in many areas of the world, Russia has surprised analysts, and its growth prospects are very good moving forward.
Russia’s economy is expected to achieve 4% to 5% GDP growth in 2012. “If it carries on growing at these rates it will contribute more to the world this decade than the whole of Europe,” stated Jim O’Neill, chairman of Goldman Sachs Asset Management.
Investors can play the strength of Russia through a U.S.-traded real estate development company, UNR Holdings (OTC BB: UNRH), that is capitalizing on the sustained growth in residential and commercial real estate demand in Moscow.
With a history that dates back more than four decades, UNRH develops and constructs multi-functional residential complexes and commercial centers, principally in the city of Moscow and its surrounding suburban communities.
The Company currently has five major developments in various stages of completion. Collectively, these developments will enable UNRH to capture revenue of approximately $1 billion and gross profit of $362 million over the next few years. In the short term, we expect total revenues of $337 million and net income of $63 million for fiscal 2012. This represents revenue and net income growth from 2011 results of 46% and 133%, respectively.
UNRH also has a strong balance sheet. The Company has booked solid growth while remaining virtually debt-free since 2009. With $51 million in marketable securities on hand and solid presales generating additional cash, UNRH is well positioned to complete its various properties without needing to raise additional capital.
At its current price of only $1.25 per share, UNRH represents a tremendous bargain. It’s trading at approximately 1.1x trailing earnings and less than 0.5x forward 2012 earnings. These are unheard-of valuation metrics for a company with solid historical growth and substantial expected growth. UNRH even has something for the value investors out there: a book value of $3.15 per share.
To learn why UNRH should be a part of your portfolio, download a free copy of our latest research report on the stock. With a price target of $6.37 per share, you don’t want to miss this great opportunity.
Disclosure: The subject security is a client of RedChip Companies, Inc. RedChip Companies, Inc., employees and affiliates may have positions and affect transactions in the securities or options of the issuers mentioned herein. For full financial disclosures for all RedChip clients, please visit http://www.redchip.com/disclosures.asp?src=rcv.
