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| Profiting From Perspective |
By:
Robert Hsu |
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Sometimes, in the heat of the moment, it's hard to stay focused on the big picture, which is China's historic growth and its increasingly entrepreneurial society. Given the current subprime credit woes and the resulting sell-off, it's especially difficult to think long-term. But as investors, it's important that we look forward and concentrate on top-notch growth opportunities.
I'd like to tell you about one such opportunity today. This company is profiting from China's ultra-competitive, examination-driven education system in China. It also has excellent fundamentals—after the last major sell-off that we saw back in late February/early March, the stock only took two weeks to recover and has been setting record highs ever since. I expect it to continue its strong performance in the coming months as it capitalizes on a growing segment of the Chinese economy.
In addition to paying for school tuition and books, according to cultural influences most Chinese parents enroll their children in pricey extracurricular tutoring, which is an area that this company positively dominates.
It was founded almost 15 years ago by a man named Michael, who was a graduate of Peking University, which is China's equivalent of Harvard. He went on to teach English at his prestigious alma mater and made $12 a month, which was considered a good salary.
But Michael wanted more, so he decided to move to the U.S. However, his student visa application was rejected. Out of this setback came one of China's most interesting companies.
Michael started a test preparation business to help other Chinese students gain admission into U.S. graduate schools and avoid the rejection he endured. From its first class of only 30 students, Michael's company has grown over the past 13 years to become China's largest private education provider. It has a network of 25 schools and more than 110 learning centers in 24 cities, as well as an online network with two million registered users.
The company has helped hundreds of thousands of Chinese students gain admission to U.S. universities by providing prep courses on the TOEFL (which measures English proficiency) and GRE standardized tests, which are required for foreign students to be accepted by U.S. universities.
This is a huge and growing market. During the past decade, China sent more students abroad than any other nation, and Chinese students now make up 14% of all foreign students worldwide. And remember, every single one of them must pass the TOEFL test. That gives you an idea of how popular—and essential—Michael's preparatory classes are.
You may have heard me say this before but it should be repeated: The people are the real drivers of China's economic miracle. People like Michael. I wouldn't want it any other way, and I can think of no better reason to be so excited about the opportunities we have to build our wealth right along with them. I invite you to join us today. (Click here http://investorplace.com/order/?pc=8VC113 to learn more.) |
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