Oppenheimer Initiates SORL Auto Parts (SORL) Coverage With Outperform Rating

Oppenheimer & Co. analyst Andy Yeung initiated coverage of SORL Auto Parts, Inc. SORL with an Outperform rating and a $15 per share price target. SORL Auto Parts, Inc. is a manufacturer of air brake systems and components for commercial vehicles and Yeung said it should benefit from strong domestic growth. The Oppenheimer & Co. analyst wrote, "we are initiating coverage on SORL Auto Parts Inc. (SORL), a leading manufacturer of air brake systems and components for commercial vehicles in China, with an Outperform rating and $15 price target (15x our '11E EPS). Near term, SORL should benefit from strong truck sales driven by strong domestic growth, stimulus spending and improving export markets, while long-run drivers include China's efforts to develop inland provinces, expansion of its international network, and entry into new markets. We think the recent pull-back has created an attractive entry point for the stock, trading at 9x its forward P/E, on our 2011 estimates, a discount to its peers and well below the company and industry's growth rates."