Surprisingly, though, Yongye International has not been hit like the others, and its shares trade 10% higher than they were back in May. Shares have actually fallen a bit from their most recent peaks, but the steady stream of small-cap stock shenanigans emanating from China has undoubtedly rattled investors.
With nothing to implicate Yongye in any of these scandals, its forward multiple below six suggests that investors are just throwing the baby out with the bathwater. When you look at its growth prospects, the miniscule valuation the market is assigning the company leaves the impression there's plenty of upside potential, with little downside risk.
CAPS member legallad praises Yongye for enlisting a big-name auditor to monitor its books:
Tremendous 3 yr growth and IMPROVING margins. Reliable big 4 auditor in sector that lacks credibility of financials. The yuan is appreciating vs dollar for foreseeable future. And lastly - everybody's gotta eat, even in China.