Wencan GroupLtd (SHSE:603348) - Share price, News & Analysis

Q: What is the Fair Price of 603348 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

603348 (CN¥90.21) is trading above our estimate of [[fair value]] (CN¥86.79)

603348 fundamental analysis
Snowflake Score
Valuation	0/6
Future Growth	6/6
Past Performance	4/6
Financial Health	4/6
Dividends	0/6

603348 Stock Overview

Wencan Group Co.,Ltd. researches, develops, manufactures, and sells automobile aluminum alloy precision die castings worldwide.

Rewards

Earnings are forecast to grow 50.14% per year

Earnings grew by 30.5% over the past year

Risk Analysis

Highly volatile share price over the past 3 months

Has a high level of debt

Wencan GroupLtd Competitors

Ningbo Xusheng Auto Technology

SHSE:603305

CN¥29.2b

Mianyang Fulin PrecisionLtd

SZSE:300432

CN¥24.4b

Hainan Drinda Automotive Trim

SZSE:002865

CN¥25.8b

Zhejiang Shuanghuan Driveline

SZSE:002472

CN¥28.1b

Price History & Performance

Summary of all time highs, changes and price drops for Wencan GroupLtd
Historical stock prices
Current Share Price	CN¥90.21
52 Week High	CN¥99.00
52 Week Low	CN¥26.95
Beta	0.48
1 Month Change	20.04%
3 Month Change	102.72%
1 Year Change	144.80%
3 Year Change	438.89%
5 Year Change	n/a
Change since IPO	310.61%

Shareholder Returns

	603348	CN Auto Components	CN Market
7D	6.3%	0.8%	2.2%
1Y	144.8%	16.0%	-7.7%

Return vs Industry: 603348 exceeded the CN Auto Components industry which returned 16% over the past year.

Return vs Market: 603348 exceeded the CN Market which returned -7.7% over the past year.

Price Volatility

Is 603348's price volatile compared to industry and market?
603348 volatility
603348 Average Weekly Movement	9.9%
Auto Components Industry Average Movement	7.7%
Market Average Movement	6.0%
10% most volatile stocks in CN Market	9.2%
10% least volatile stocks in CN Market	3.8%

Stable Share Price: 603348 is more volatile than 90% of CN stocks over the past 3 months, typically moving +/- 10% a week.

Volatility Over Time: 603348's weekly volatility (10%) has been stable over the past year, but is still higher than 75% of CN stocks.

About the Company

Founded	Employees	CEO	Website
1998	5,318	- Jason	https://www.wencan.com

Wencan Group Co.,Ltd. researches, develops, manufactures, and sells automobile aluminum alloy precision die castings worldwide. The company’s products have applications in engine systems, transmission systems, chassis systems, braking systems, body structure fields, and other auto parts in traditional fuel vehicles and new energy vehicles.

Wencan GroupLtd Fundamentals Summary

How do Wencan GroupLtd's earnings and revenue compare to its market cap?
603348 fundamental statistics
Market Cap	CN¥23.65b
Earnings (TTM)	CN¥160.06m
Revenue (TTM)	CN¥4.52b

147.8x

P/E Ratio

5.2x

P/S Ratio

Is 603348 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
603348 income statement (TTM)
Revenue	CN¥4.52b
Cost of Revenue	CN¥3.79b
Gross Profit	CN¥732.70m
Other Expenses	CN¥572.64m
Earnings	CN¥160.06m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.61
Gross Margin	16.20%
Net Profit Margin	3.54%
Debt/Equity Ratio	69.2%

How did 603348 perform over the long term?

See historical performance and comparison

Dividends

0.2%

Current Dividend Yield

24%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 603348 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

0/6

Valuation Score 0/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 603348?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 603348. This is calculated by dividing 603348's market cap by their current preferred multiple.
What is 603348's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	CN¥23.65b

603348 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	5.6x
Enterprise Value/EBITDA	42.2x
PEG Ratio	2.9x

Price to Earnings Ratio vs Peers

How does 603348's PE Ratio compare to its peers?

603348 PE Ratio vs Peers

The above table shows the PE ratio for 603348 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	6.4x
603305 Ningbo Xusheng Auto Technology	65.9x	24.0%	CN¥29.2b
300432 Mianyang Fulin PrecisionLtd	47.9x	n/a	CN¥24.4b
002865 Hainan Drinda Automotive Trim	n/a	70.6%	CN¥25.8b
002472 Zhejiang Shuanghuan Driveline	71.6x	35.7%	CN¥28.1b
603348 Wencan GroupLtd	147.8x	50.1%	CN¥23.6b

Price-To-Earnings vs Peers: 603348 is expensive based on its Price-To-Earnings Ratio (147.8x) compared to the peer average (6.4x).

Price to Earnings Ratio vs Industry

How does 603348's PE Ratio compare vs other companies in the CN Auto Components Industry?

Price-To-Earnings vs Industry: 603348 is expensive based on its Price-To-Earnings Ratio (147.8x) compared to the CN Auto Components industry average (54.4x)

Price to Earnings Ratio vs Fair Ratio

What is 603348's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

603348 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	147.8x
Fair PE Ratio	46.3x

Price-To-Earnings vs Fair Ratio: 603348 is expensive based on its Price-To-Earnings Ratio (147.8x) compared to the estimated Fair Price-To-Earnings Ratio (46.3x).

Share Price vs Fair Value

What is the Fair Price of 603348 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 603348 (CN¥90.21) is trading above our estimate of fair value (CN¥86.79)

Significantly Below Fair Value: 603348 is trading above our estimate of fair value.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.

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Future Growth

How is Wencan GroupLtd forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

Future Growth Score

6/6

Future Growth Score 6/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

50.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 603348's forecast earnings growth (50.1% per year) is above the savings rate (3.2%).

Earnings vs Market: 603348's earnings (50.1% per year) are forecast to grow faster than the CN market (24.7% per year).

High Growth Earnings: 603348's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 603348's revenue (24.1% per year) is forecast to grow faster than the CN market (17.8% per year).

High Growth Revenue: 603348's revenue (24.1% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 603348's Return on Equity is forecast to be high in 3 years time (20.4%)

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Past Performance

How has Wencan GroupLtd performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-8.8%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 603348 has high quality earnings.

Growing Profit Margin: 603348's current net profit margins (3.5%) are higher than last year (3.1%).

Past Earnings Growth Analysis

Earnings Trend: 603348's earnings have declined by 8.8% per year over the past 5 years.

Accelerating Growth: 603348's earnings growth over the past year (30.5%) exceeds its 5-year average (-8.8% per year).

Earnings vs Industry: 603348 earnings growth over the past year (30.5%) exceeded the Auto Components industry -16.7%.

Return on Equity

High ROE: 603348's Return on Equity (5.7%) is considered low.

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Financial Health

How is Wencan GroupLtd's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 603348's short term assets (CN¥2.5B) exceed its short term liabilities (CN¥2.4B).

Long Term Liabilities: 603348's short term assets (CN¥2.5B) exceed its long term liabilities (CN¥1.2B).

Debt to Equity History and Analysis

Debt Level: 603348's net debt to equity ratio (51%) is considered high.

Reducing Debt: 603348's debt to equity ratio has increased from 55.8% to 69.2% over the past 5 years.

Debt Coverage: 603348's debt is well covered by operating cash flow (22.4%).

Interest Coverage: 603348's interest payments on its debt are well covered by EBIT (3.1x coverage).

Balance Sheet

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Dividend

What is Wencan GroupLtd current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

0.17%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 603348's dividend (0.17%) isn’t notable compared to the bottom 25% of dividend payers in the CN market (0.44%).

High Dividend: 603348's dividend (0.17%) is low compared to the top 25% of dividend payers in the CN market (1.87%).

Stability and Growth of Payments

Stable Dividend: 603348 is not paying a notable dividend for the CN market, therefore no need to check if payments are stable.

Growing Dividend: 603348 is not paying a notable dividend for the CN market, therefore no need to check if payments are increasing.

Earnings Payout to Shareholders

Earnings Coverage: 603348 is not paying a notable dividend for the CN market.

Cash Payout to Shareholders

Cash Flow Coverage: 603348 is paying a dividend but the company has no free cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

CEO

- Jason

no data

Tenure

Jason serves as the President of Wencan Group Co.,Ltd. (formerly known as Guangdong Wencan Die Casting Co., Ltd.)

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/18 00:00
End of Day Share Price	2022/08/18 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31