SZSE:002624

Stock Analysis Report

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Executive Summary

Perfect World Co., Ltd., together with its subsidiaries, engages in the development, publishing, and operation of online games in China. More Details


Snowflake Analysis

Flawless balance sheet and undervalued.

Share Price & News

How has Perfect World's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 002624 is not significantly more volatile than the rest of CN stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: 002624's weekly volatility (8%) has been stable over the past year.


Market Performance


7 Day Return

6.1%

2624

0.6%

CN Entertainment

-2.1%

CN Market


1 Year Return

-21.8%

2624

-12.0%

CN Entertainment

18.7%

CN Market

Return vs Industry: 002624 underperformed the CN Entertainment industry which returned -12% over the past year.

Return vs Market: 002624 underperformed the CN Market which returned 18.7% over the past year.


Shareholder returns

2624IndustryMarket
7 Day6.1%0.6%-2.1%
30 Day-5.3%-6.6%-3.5%
90 Day-13.2%-8.8%0.9%
1 Year-21.4%-21.8%-11.5%-12.0%20.6%18.7%
3 Year15.7%13.8%-31.8%-33.0%27.0%20.8%
5 Year12.7%10.5%-44.9%-45.9%48.7%38.4%

Long-Term Price Volatility Vs. Market

How volatile is Perfect World's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Perfect World undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 002624 (CN¥25.04) is trading below our estimate of fair value (CN¥195.22)

Significantly Below Fair Value: 002624 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 002624 is good value based on its PE Ratio (26.5x) compared to the CN Entertainment industry average (33.6x).

PE vs Market: 002624 is good value based on its PE Ratio (26.5x) compared to the CN market (34.5x).


Price to Earnings Growth Ratio

PEG Ratio: 002624 is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: 002624 is overvalued based on its PB Ratio (4.5x) compared to the CN Entertainment industry average (2.7x).


Next Steps

Future Growth

How is Perfect World forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

29.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 002624's forecast earnings growth (29.1% per year) is above the savings rate (3.3%).

Earnings vs Market: 002624's earnings (29.1% per year) are forecast to grow faster than the CN market (24.9% per year).

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

Revenue vs Market: 002624's revenue (17.6% per year) is forecast to grow slower than the CN market (18.2% per year).

High Growth Revenue: 002624's revenue (17.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 002624's Return on Equity is forecast to be low in 3 years time (20%).


Next Steps

  • Explore growth companies in the Media industry.

Past Performance

How has Perfect World performed over the past 5 years?

25.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 002624 has high quality earnings.

Growing Profit Margin: 002624's current net profit margins (17.8%) are lower than last year (22.3%).


Past Earnings Growth Analysis

Earnings Trend: 002624's earnings have grown significantly by 25.5% per year over the past 5 years.

Accelerating Growth: 002624's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 002624 had negative earnings growth (-1.4%) over the past year, making it difficult to compare to the Entertainment industry average (17.1%).


Return on Equity

High ROE: 002624's Return on Equity (15%) is considered low.


Next Steps

Financial Health

How is Perfect World's financial position?


Financial Position Analysis

Short Term Liabilities: 002624's short term assets (CN¥8.9B) exceed its short term liabilities (CN¥4.3B).

Long Term Liabilities: 002624's short term assets (CN¥8.9B) exceed its long term liabilities (CN¥214.7M).


Debt to Equity History and Analysis

Debt Level: 002624's debt to equity ratio (9.8%) is considered satisfactory.

Reducing Debt: 002624's debt to equity ratio has reduced from 124.1% to 9.8% over the past 5 years.

Debt Coverage: 002624's debt is well covered by operating cash flow (352.2%).

Interest Coverage: 002624 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is Perfect World current dividend yield, its reliability and sustainability?

0.64%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 002624's dividend (0.64%) is higher than the bottom 25% of dividend payers in the CN market (0.4%).

High Dividend: 002624's dividend (0.64%) is low compared to the top 25% of dividend payers in the CN market (1.78%).


Stability and Growth of Payments

Stable Dividend: 002624 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 002624's dividend payments have increased, but the company has only paid a dividend for 6 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (17%), 002624's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 002624's dividends in 3 years are forecast to be well covered by earnings (26.2% payout ratio).


Next Steps

Management

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

4.6yrs

Average management tenure


CEO

Jie Lian (45 yo)

4.58yrs

Tenure

CN¥5,400,000

Compensation

Mr. Jie Lian has been President of Perfect World Co., Ltd. since August 25, 2016 and has been its Executive Deputy General Manager since September 22, 2016. Mr. Lian serves as Senior Advisor at Primavera C...


Leadership Team

NamePositionTenureCompensationOwnership
Jie Lian
President & Executive Deputy GM4.58yrsCN¥5.40mno data
Hong Xiao
GM & Directorno dataCN¥6.28mno data
Ying Zeng
CFO & Deputy GM6yrsCN¥3.61mno data
Wei Wei Wang
Deputy GM & Secretary of the Board of Directorsno dataCN¥3.61mno data

4.6yrs

Average Tenure

48yo

Average Age

Experienced Management: 002624's management team is considered experienced (4.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Hong Xiao
GM & Directorno dataCN¥6.28mno data
Yufeng Chi
Chairmanno dataCN¥6.65m7.69%
CN¥ 3.7b
Xiaoyin Lu
Non-Independent Director0.17yrno datano data
Xian Wen Xie
Member of Supervisory Boardno datano datano data
Tian Liang
Member of the Supervisory Boardno datano datano data
Li Yang
Member of the Supervisory Boardno datano datano data
Ziqiang Sun
Independent Director0.17yrno datano data
Doudou Wang
Independent Director0.17yrno datano data
Ying Guan
Member of Supervisory Board0.17yrno datano data
Dan Zhang
Member of Supervisory Board0.17yrno datano data

0.2yrs

Average Tenure

47yo

Average Age

Experienced Board: 002624's board of directors are not considered experienced ( 0.2 years average tenure), which suggests a new board.


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.


Top Shareholders

Company Information

Perfect World Co., Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Perfect World Co., Ltd.
  • Ticker: 2624
  • Exchange: SZSE
  • Founded: 2008
  • Industry: Interactive Home Entertainment
  • Sector: Media
  • Market Cap: CN¥48.167b
  • Shares outstanding: 1.94b
  • Website: https://www.pwpic.com

Number of Employees


Location

  • Perfect World Co., Ltd.
  • Perfect World Building
  • No.86 Beiyuan Road
  • Beijing
  • 100101
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2624SZSE (Shenzhen Stock Exchange)YesDomestic SharesCNCNYDec 2014
2624XSEC (Shenzhen Stock Exchange - Shenzhen-Hong Kong Stock Connect)YesDomestic SharesCNCNYDec 2014

Biography

Perfect World Co., Ltd., together with its subsidiaries, engages in the development, publishing, and operation of online games in China. It is also involved in engages in the production, distribution, and ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/03/05 09:14
End of Day Share Price2021/03/05 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.