I came across an interesting article that talks about why AOB(7.98 +0.08 +1.01%, ) is a good growth stock from Forbes: Making Money On Chinese Medicine

Excerpt from the article that I found interestig:

With top line growth expected to exceed 50% in 2008, an earnings multiple of about 14 and favorable demographic trends, the stock offers great growth potential at a bargain basement price.

Products fall into two categories. Plant-based pharmaceuticals, which generated 82% of first-quarter sales, are medicinal compounds derived from the leaves and roots of plants. These products, approved by the Chinese State Food and Drug Administration, are used to treat various illnesses. They are sold over the counter and by prescription.

Plant-based nutraceuticals generated 18% of first-quarter sales. These are dietary supplements designed to prevent illness rather than treat it. PBNs are also believed to promote health and wellness. AOB sells tablets, powders and an instant coffee containing soy peptides. It also sells nutritional drinks derived from honey products, marine plants and natural herbs that are rich in amino acids and vitamins.

AOB has benefited from a general preference in China for TCMs over synthetically manufactured alternatives. Complementary acquisitions have also contributed to the company’s growth.

I bought some AOB(7.98 +0.08 +1.01%, ) at $8.50 this morning to lower my cost after yesterday’s big drop.

I just sold the FCX(73.91 -1.02 -1.36%, ) shares that I bought yesterday because it went up over 6% today.

I’m still in it because the fundamental is strong, but I need to take this profit so I can buy in again when it drops and keep lowering my average cost.

I bought some more FCX(73.91 -1.02 -1.36%, ) today to lower my average cost.

What does the recent MER(26.73 +0.52 +1.98%, ) deal with Lone Star mean? Marek Fuchs from The Street explains it in plain english. Here’s the take away:

These securities, after all, were valued at $11.1 billion a few weeks ago when Merrill reported its quarter results and are now being sold for $6.7 billion — but that’s not even the troubling part. See, the buyer would take the bucket of slop only if Merrill financed most of it. The company did — 75% worth — with debt whose only collateral are the assets that Merrill is selling. What does this mean in plain English?

Merrill is still open to tons of risk.

The company really only took out 25% of $6.7 billion, or $1.675 billion of risk, off the balance sheet.