Li & Fung shares are hovering near their 4-year lows and there
is little to suggest that its earnings report will enthuse
** Li & Fung is the HSI's fourth-worst performing stock this
year behind the coal stocks and Belle International.
** Company has struggled to generate revenue from its
aggressive acquisitions resulting in the lowest return on assets
since at least 2000. link.reuters.com/maz32v
** Relationship between ROA & share price particularly
strong since February 2011.
** Shares staged a recovery of sorts from April-end through
to mid-July on hopes that a better U.S. economy would help
reverse Li & Fung's fortunes.
** EPS estimates are being cut. 2013 EPS estimate is down
3.4% in the past month according to StarMine.
** The company's U.S. unit, LF USA, continues to struggle
with margin improvement still missing. Goldman Sachs says "it is
more about the micro than macro for L&F"
** Short-selling remains strong. According to Markit it is
the second-most heavily borrowed stock in the Hang Seng in terms
of percentage of shares out on loan vs total outstanding shares.
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