Global Hunter Reiterates Buy on QKL Stores (QKLS)

Global Hunter is out with its report today on QKL Stores QKLS, reiterating Buy. In a note to clients, Global Hunter writes, "We expect QKL Stores, Inc. to report Q1 results within the next week. We visited the company's new Harbin distribution center, four QKL stores, and two competing stores. We came away with a good impression of store management and QKLS' positioning in fresh food, its core competency, in which we believe the company will continue to gain market share and maintain customer loyalty. The company has announced 11 new store openings YTD, just one store away from its full year goal of 12 new additions. We are encouraged by our visit and its expansion pace and remain optimistic of the company's growth potential. Its American peers are trading in the range of 9x to 14x forward earnings while QKLS is trading at 5.5x, which we believe is unwarranted. As such we reiterate our Buy rating with a price target of $4, or 9x our FY11 EPS estimate." Shares of QKLS closed Friday at $2.33.