Business

Nova Lifestyle Inc (NASDAQ:NVFY) Jumps in Pre-Market on Guidance

Nova Lifestyle Inc (NASDAQ:NVFY)

Shares of Nova Lifestyle Inc (NASDAQ:NVFY) are up over 20% in the pre-market after the company provided financial guidance for Q4 2017. The pre-market low of $1.92 was hit at 7:45 AM EST, and the pre-market high was established at 7:53 AM EST at $2.38. Volume has been light to moderate.

Nova Lifestyle Inc (NASDAQ:NVFY) forecasted revenues to come in between $35 and $36 million. Net income guidance was$3 million – $3.5 million. Net income, per share, is expected to be in the range of $0.11 – $0.13 for the quarter. And, notably, Nova announced that it expects expanded profit margins across nearly all product lines.

Tawny Lam, CEO of Nova Lifestyle Inc (NASDAQ:NVFY) stated “Since the Company’s successful transformation in early 2017 from a low-margin furniture manufacturing business to a high-margin innovative designer and global marketer of modern lifestyle consumer products, we have significantly fine-tuned our product mix and deepened distribution channels, which led to our recently announced record 3rd quarter financial results.”

“Nova made over $1 million in net income during the month of October, a substantial increase over the same period last year. Nova expects the same growth momentum to continue for the balance of the 4th quarter of 2017 and well into 2018.”

Nova LifeStyle Business Model

Nova Lifestyle Inc (NASDAQ:NVFY) is headquartered in Commerce, California. The company designs, manufactures, and distributes modern LifeStyle furniture – primarily sofas, dining rooms, cabinets, office furniture and related components, bedrooms, and various accessories in matching collections. Nova’s products are made and marketed in the US, Europe, and Asia and include LifeStyle brands such as Diamond Sofa, Nova QwiK, and Bright Swallow International.

NVFY Stock Performance

Nova Lifestyle Inc (NASDAQ:NVFY) broke above strong resistance at $2 last week, sold off, then broke above the key threshold again yesterday. NVFY has a 52-week low of $1.06 and a 52-week high of $3.13.

Over the past quarter, the stock has outperformed, gaining over 30%. However, over the past year, NVFY stock has lost over 40%. Recently the company has been trading near it book/share value of $2.28. What is interesting is that listed reports have Nova Lifestyle’s cash per share at just $0.01.

Sales have not impressed over the last few years. In 2014, sales were reported at $98.7 million and that decreased to $92.6 million by 2016. Earnings have also been challenging. In 2014 EPS was at $0.42, but in 2016 the company posted a per share loss of (-$0.01).

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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About the author: James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.

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James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.

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