Global Hunter Securities Reiterates Buy Rating, $18 PT On DEER

Global Hunter Securities is reiterating its Buy rating, $18 PT on shares of Deer Consumer Products, Inc. (NASDAQ: DEER).

“DEER reported Q4 results that beat consensus due to strengthened private label exports and branded domestic sales,” Global Hunter Securities writes.

“But management tempered its FY2011 outlook in what feels like an attempt to set the bar conservatively. DEER also implemented a cash dividend of $0.05 per quarter in order to reward shareholders for patience, given the challenging environment for US-Listed China companies.

“In response to questions that have been raised, we have been able to gather additional information regarding the company's recent land acquisitions and have encouraged management to make this information public in the near term.”

“We hope that this additional information provides some clarity regarding a significant use of cash and helps to remove some of the overhang,” Global Hunter Securities adds. “Management also mentioned in its release that it is ‘exploring strategic options' which we view as confirmation of our original thesis regarding the potential for the value DEER has created in building its domestic distribution platform to allow it to become an acquisition target.”

Deer Consumer Products closed Friday at $11.20.