Hangzhou Greatstar Industrial (SZSE:002444) - Share price, News & Analysis

Q: What is the Fair Price of 2444 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

002444 (CN¥24.48) is trading above our estimate of [[fair value]] (CN¥0.59)

2444 fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	2/6
Past Performance	2/6
Financial Health	4/6
Dividends	0/6

2444 Stock Overview

Hangzhou GreatStar Industrial Co., Ltd. designs, develops, manufactures, and supplies tools for the DIY, professional, and industrial markets worldwide.

Rewards

Price-To-Earnings ratio (23.3x) is below the CN market (35.3x)

Earnings are forecast to grow 23.15% per year

Risk Analysis

Profit margins (10.1%) are lower than last year (15.5%)

Hangzhou Greatstar Industrial Competitors

Hangzhou Robam Appliances

SZSE:002508

CN¥25.3b

Kingclean ElectricLtd

SHSE:603355

CN¥19.4b

Guangdong Xinbao Electrical Appliances Holdings

SZSE:002705

CN¥16.9b

Zhejiang Supor

SZSE:002032

CN¥36.6b

Price History & Performance

Summary of all time highs, changes and price drops for Hangzhou Greatstar Industrial
Historical stock prices
Current Share Price	CN¥24.48
52 Week High	CN¥35.79
52 Week Low	CN¥13.09
Beta	1.19
1 Month Change	38.38%
3 Month Change	36.91%
1 Year Change	-25.82%
3 Year Change	134.03%
5 Year Change	62.66%
Change since IPO	256.72%

Shareholder Returns

	2444	CN Consumer Durables	CN Market
7D	12.3%	2.1%	1.6%
1Y	-25.8%	-24.1%	-10.1%

Return vs Industry: 002444 underperformed the CN Consumer Durables industry which returned -24.1% over the past year.

Return vs Market: 002444 underperformed the CN Market which returned -10.1% over the past year.

Price Volatility

Is 2444's price volatile compared to industry and market?
2444 volatility
2444 Average Weekly Movement	7.3%
Consumer Durables Industry Average Movement	5.9%
Market Average Movement	6.0%
10% most volatile stocks in CN Market	9.1%
10% least volatile stocks in CN Market	3.9%

Stable Share Price: 002444 is not significantly more volatile than the rest of CN stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: 002444's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1993	10,778	Xiaoheng Chi	https://www.greatstartools.com

Hangzhou GreatStar Industrial Co., Ltd. designs, develops, manufactures, and supplies tools for the DIY, professional, and industrial markets worldwide. The company offers hand tools, including fastening, cutting, measuring, layout, striking, and mechanic tools, as well as clamps and vises, and tool sets; and specialty tools, such as electrician, drywall, and tiling and flooring tools. It also provides lighting tools comprising flash lights, spot lights and lanterns, head lamps, and work lights, as well as other lighting tools consisting of cylindrical LED key chains, flexible LED lights, LED push lights, and LED book lights, as well as masonry, painting, electrical, plumbing, automotive, and garden tools.

Hangzhou Greatstar Industrial Fundamentals Summary

How do Hangzhou Greatstar Industrial's earnings and revenue compare to its market cap?
2444 fundamental statistics
Market Cap	CN¥27.84b
Earnings (TTM)	CN¥1.20b
Revenue (TTM)	CN¥11.81b

23.3x

P/E Ratio

2.4x

P/S Ratio

Is 2444 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
2444 income statement (TTM)
Revenue	CN¥11.81b
Cost of Revenue	CN¥9.02b
Gross Profit	CN¥2.79b
Other Expenses	CN¥1.60b
Earnings	CN¥1.20b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	1.05
Gross Margin	23.63%
Net Profit Margin	10.12%
Debt/Equity Ratio	36.0%

How did 2444 perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is 2444 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

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 2444?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 2444. This is calculated by dividing 2444's market cap by their current preferred multiple.
What is 2444's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	CN¥27.84b

2444 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	2.4x
Enterprise Value/EBITDA	23x
PEG Ratio	1x

Price to Earnings Ratio vs Peers

How does 2444's PE Ratio compare to its peers?

2444 PE Ratio vs Peers

The above table shows the PE ratio for 2444 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	23.8x
002508 Hangzhou Robam Appliances	18.9x	16.3%	CN¥25.3b
603355 Kingclean ElectricLtd	37x	22.7%	CN¥19.4b
002705 Guangdong Xinbao Electrical Appliances Holdings	21.1x	16.7%	CN¥16.9b
002032 Zhejiang Supor	18.2x	13.3%	CN¥36.6b
002444 Hangzhou Greatstar Industrial	23.3x	23.2%	CN¥27.8b

Price-To-Earnings vs Peers: 002444 is good value based on its Price-To-Earnings Ratio (23.3x) compared to the peer average (23.8x).

Price to Earnings Ratio vs Industry

How does 2444's PE Ratio compare vs other companies in the CN Consumer Durables Industry?

Price-To-Earnings vs Industry: 002444 is good value based on its Price-To-Earnings Ratio (23.3x) compared to the CN Consumer Durables industry average (27.7x)

Price to Earnings Ratio vs Fair Ratio

What is 2444'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.

2444 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	23.3x
Fair PE Ratio	24.1x

Price-To-Earnings vs Fair Ratio: 002444 is good value based on its Price-To-Earnings Ratio (23.3x) compared to the estimated Fair Price-To-Earnings Ratio (24.1x).

Share Price vs Fair Value

What is the Fair Price of 2444 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 002444 (CN¥24.48) is trading above our estimate of fair value (CN¥0.59)

Significantly Below Fair Value: 002444 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 Hangzhou Greatstar Industrial forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

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

23.2%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 002444's forecast earnings growth (23.2% per year) is above the savings rate (3.2%).

Earnings vs Market: 002444's earnings (23.2% per year) are forecast to grow slower than the CN market (24.5% per year).

High Growth Earnings: 002444's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 002444's revenue (15.9% per year) is forecast to grow slower than the CN market (17.7% per year).

High Growth Revenue: 002444's revenue (15.9% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 002444's Return on Equity is forecast to be low in 3 years time (13.7%).

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Past Performance

How has Hangzhou Greatstar Industrial performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

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

20.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 002444 has high quality earnings.

Growing Profit Margin: 002444's current net profit margins (10.1%) are lower than last year (15.5%).

Past Earnings Growth Analysis

Earnings Trend: 002444's earnings have grown significantly by 20.5% per year over the past 5 years.

Accelerating Growth: 002444's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 002444 had negative earnings growth (-16.1%) over the past year, making it difficult to compare to the Consumer Durables industry average (-2.1%).

Return on Equity

High ROE: 002444's Return on Equity (11.2%) is considered low.

Discover strong past performing companies

Financial Health

How is Hangzhou Greatstar Industrial'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: 002444's short term assets (CN¥9.6B) exceed its short term liabilities (CN¥5.0B).

Long Term Liabilities: 002444's short term assets (CN¥9.6B) exceed its long term liabilities (CN¥1.3B).

Debt to Equity History and Analysis

Debt Level: 002444 has more cash than its total debt.

Reducing Debt: 002444's debt to equity ratio has increased from 11.2% to 36% over the past 5 years.

Debt Coverage: 002444's debt is not well covered by operating cash flow (3.3%).

Interest Coverage: 002444 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is Hangzhou Greatstar Industrial 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

0.16%

Forecast Dividend Yield

Dividend Yield vs Market

Notable Dividend: Unable to evaluate 002444's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate 002444's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 002444's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 002444's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: 002444 is not paying a notable dividend for the CN market.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as 002444 has not reported any payouts.

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Management

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

14.2yrs

Average management tenure

CEO

Xiaoheng Chi (47 yo)

1.58yrs

Tenure

CN¥1,800,000

Compensation

Ms. Xiaoheng Chi is General Manager of Hangzhou Great Star Industrial Co., Ltd since January 2021. Ms. Chi is Deputy Chairman of Hangzhou Great Star Industrial Co., Ltd. since August 31, 2020.She was Vice...

Leadership Team

Experienced Management: 002444's management team is seasoned and experienced (14.2 years average tenure).

Board Members

Experienced Board: 002444's board of directors are seasoned and experienced ( 11.2 years average tenure).

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	2022/08/14 00:00
End of Day Share Price	2022/08/12 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31