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China Automotive Systems shares, up 40 percent since last week, tumble after downgrade

China Automotive Systems

China Automotive Systems Shares

NEW YORK — Shares of China Automotive Systems Inc., China’s largest independent supplier of power steering systems for cars, fell Friday after an analyst downgraded the stock, which has surged in recent weeks.

Global Hunter Securities analyst Ping Luo downgraded the shares to “Neutral” from “Buy,” noting that they climbed 40 percent since her Nov. 5 upgrade.

“Although we continue to like the fundamentals of the company, we believe the shares are fairly valued at current levels,” she wrote in a client note.

On Thursday the company reported third-quarter profit rose sharply on a 75 percent boost in sales. China Automotive also said it expects 2009 revenue to be up 40 percent.

In morning trading the stock fell 99 cents, or 6.1 percent, to $15.26.

Merriman Curhan Ford analyst Eric Wold said Friday that some of the day’s share price decline may be profit-taking. In the past 12 months, the stock has risen 645 percent.

China Automotive shares “have had a phenomenal run lately and were up strongly yesterday following the upside results. I would suspect that some of this is natural profit-taking,” he said.

(Associated Press)

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