Right now in China, the expansion in smartphone use is creating a "Wild West," where the technology is developing faster than law enforcement can keep up, suggests Paul Goodwin, editor of Cabot China & Emerging Markets Report.

The good guys (law abiding mobile users) are being preyed up by the bad guys (hackers and scammers). And that, in a nutshell, is why there is a company called NQ Mobile (NQ).

The number of mobile subscriptions in China hit 1.2 billion in July, and a little more than a third of mobile subscribers are on 3G accounts.

That's made it a field day for designers of viruses, trojan horses, and malware of all kinds, with new threats appearing almost daily. But NQ Mobile, founded in 2005, has built its client base to 372 million registered accounts by making protection simple.

NQ Mobile is a very sophisticated watchdog for mobile devices. It's credited with identifying three out of every four new mobile threats worldwide and has an enormous database of viruses, malicious Web sites, and other scams, and can cure and protect users from all of them.

NQ offers its basic protection software for free, but makes money via premium software protection. The company has also used its large subscriber base to offer a variety of other services, like Cloud data storage, family controls for young mobile users, performance software, and caller controls.

Revenue also comes from games and providing enterprise mobility solutions for medium and large Chinese companies.

NQ Mobile has enjoyed three years of triple-digit revenue growth and has increased earnings from $.06 per share in 2010 to $.66 in 2012. Analysts expect 2013 earnings to come in around $1.05 and revenue, which was $92 million in 2012, to hit $187 million this year.

The company also just announced that its Q3 revenues are expected to top the high-end of its previous guidance. All in all, the fundamentals look very good, including the after-tax profit margin of 36.3% in Q2.

We have featured NQ Mobile before, buying it in March 2012. It's worth reiterating that one factor that contributed to our previous buy was the company's hiring of Omar Khan as co-CEO in January 2012.

Mr. Khan was hired away from Citigroup—where he headed the company's global mobile development and delivery efforts—to oversee NQ's global expansion. Khan's willingness to jump ship and sign on with NQ Mobile was a big plus in establishing the company's bona fides.

NQ made a nice run from October 2011 through April 2012, soaring from $3.5 to $13. Then came a 14-month correction/consolidation that ended with the stock at $7 in June. The blast-off from that base pushed NQ to $20 in August.

After a four-week correction that found support at $16, NQ broke out to $22 in September. We think it's buyable on dips below $23. Though, for now, we recommend you buy only one-half of the position you intend to take.

Subscribe to Cabot China & Emerging Markets Report here…

More from MoneyShow.com:

Apple is Still Innovating

Mercado Libre: Latin Shopping

Skyworks: Connect with RF Technology