UPDATE: Oppenheimer Initiates Zhongpin at Outperform

Oppenheimer has published a research report on Zhongpin

and has initiated coverage on the company with an Outperform rating. In the report, Oppenheimer writes, "Zhongpin is China's 4th largest hog slaughtering and meat processing company. The company has grown its revenue at an impressive 48% CAGR from 2007-2010. We believe its vertically integrated supply chain, brand name, high-quality products and extensive distribution network will allow it to grow above industry and benefit from the ongoing industry consolidation in the coming years. We estimate HOGS's revenue and EPS to grow at '11-'13 CAGR of 18% and 19%, respectively. We believe that, at current levels, potential sector risks are fully priced-in. Our $12 PT assumes a 4.5x P/E multiple our FY13E EPS of $2.73." Oppenheimer has also established a $12 price target on Zhongpin, which is currently trading up $0.70 from yesterday's $9.52 closing price.