Beijing-based real estate/mobile phone solutions company TechFaith Wireless Communication Technology Ltd. (NASDAQ:CNTF) closed trading Tuesday at $1.91 per share and catapulted over $3.00 per share at one point in Wednesday morning action. Shares were lifted by news that TechFaith swung to a profit in 2016 and inked an agreement to divest some assets.
For the full year 2016, TechFaith reported revenue of $60.96 million, down from $63.67 million in 2015. Thanks to more tightly controlled spending, gross profit increased to $12.45 million from $5.84 million. A strong second half of 2016 led to a net profit of $10.1 million, or 96 cents per ADS (American Depositary Share), for 2016, reversing course from a net loss of $12.8 million, or $1.21 per ADS, in 2015.
TechFaith disclosed that, through its subsidiary, it is selling its Techfaith Intelligent Handset Technology (Beijing) Limited unit along with certain land use rights and ongoing construction on a piece of land to Beijing Hongkungu Investment Company Limited. Payable in installments, the sale has been agreed upon at a price of RMB 1 billion (US$144 million).
Not bad for a company that began the day with a market capitalization around $15 million.
Shares sprinted as high as $3.45 in early trading today and have chilled some to $2.81, representing a gain of 46.8% on the day and highest level so far in 2017.
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