Credit Suisse Ugrades China Distance Education Hldgs Ltd To Out Perform

China Distance Education Hldgs Ltd

fast growth should generate a strong free cash flow, most of which will be returned to shareholders as dividends, an analyst said Wednesday. China Distance gained nearly 20 percent recently, changing hands at $17.95 a share. The Beijing-based online equivalent of a correspondence school posted fiscal first-quarter revenue growth of 30 percent Tuesday, to $97.2 million, and Credit Suisse's Jialong Shi upgraded the company to Out Perform with a $21 target. The company's fourth-quarter net income grew 47.5 percent to $9.1 million, or $0.67 cents a share. Shi said the the finance and accounting training market in China will grow 9 percent over the next four years, while China Distance's market share will grow to 10 percent, from a current 8 percent. The analyst estimated that China Distance will generate $40 million in free cash flow annually, with "most of that" going into dividend payouts. Chief Financial Officer Ping Wei on Tuesday forecast 2015 revenue growth between 27 percent and 32 percent on expected gains in market share. got upgraded to Buy