Topsec Technologies Group (SZSE:002212) - Share price, News & Analysis

2212 fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	5/6
Past Performance	1/6
Financial Health	6/6
Dividends	1/6

2212 Stock Overview

Topsec Technologies Group Inc., together with its subsidiaries, provides cyber security, big data, and cloud services in China.

Rewards

Trading at 64.5% below our estimate of its fair value

Earnings are forecast to grow 77.41% per year

Risk Analysis

Large one-off items impacting financial results

Topsec Technologies Group Competitors

Qingdao Hanhe CableLtd

SZSE:002498

CN¥12.2b

Baosheng Science and Technology InnovationLtd

SHSE:600973

CN¥5.6b

Jiangsu Zhongchao Holding

SZSE:002471

CN¥2.9b

Jiangnan Group

SEHK:1366

HK$1.4b

Price History & Performance

Summary of all time highs, changes and price drops for Topsec Technologies Group
Historical stock prices
Current Share Price	CN¥8.93
52 Week High	CN¥21.30
52 Week Low	CN¥8.28
Beta	0.54
1 Month Change	-2.08%
3 Month Change	-37.20%
1 Year Change	-52.68%
3 Year Change	-38.96%
5 Year Change	-38.71%
Change since IPO	-3.32%

Shareholder Returns

	2212	CN Software	CN Market
7D	-4.7%	-3.5%	-1.0%
1Y	-52.7%	-37.1%	-18.0%

Return vs Industry: 002212 underperformed the CN Software industry which returned -32.9% over the past year.

Return vs Market: 002212 underperformed the CN Market which returned -14.2% over the past year.

Price Volatility

Is 2212's price volatile compared to industry and market?
2212 volatility
2212 Average Weekly Movement	6.9%
Software Industry Average Movement	7.0%
Market Average Movement	7.4%
10% most volatile stocks in CN Market	10.3%
10% least volatile stocks in CN Market	5.4%

Stable Share Price: 002212 is not significantly more volatile than the rest of CN stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: 002212's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1985	5,357	n/a	https://www.topsec.com.cn

Topsec Technologies Group Inc., together with its subsidiaries, provides cyber security, big data, and cloud services in China. The company offers network security products for various fields, such as border and cloud security, security detection and management, endpoint and data security, application and wireless security, etc.; and industrial internet security products comprising production network boundary isolation, industrial control network boundary protection, production network security behavior audit, production network intrusion detection, industrial control terminal security, industrial interconnection security vulnerability scanning, production network compliance inspection, security centralized management, and enterprise situation awareness products. It also provides IoT security access gateway, security identification management, and security management center; IoT enabling platform; video security monitoring and analysis, video security audit, video data protection, drone countermeasure system, and other products; and in-vehicle security gateways, in-vehicle IDPS, in-vehicle authentication encryption, internet of vehicles security situation awareness, internet of vehicles security detection and monitoring platform, and other products.

Topsec Technologies Group Fundamentals Summary

How do Topsec Technologies Group's earnings and revenue compare to its market cap?
2212 fundamental statistics
Market Cap	CN¥10.33b
Earnings (TTM)	CN¥260.65m
Revenue (TTM)	CN¥3.46b

39.6x

P/E Ratio

3.0x

P/S Ratio

Is 2212 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
2212 income statement (TTM)
Revenue	CN¥3.46b
Cost of Revenue	CN¥1.38b
Gross Profit	CN¥2.08b
Other Expenses	CN¥1.82b
Earnings	CN¥260.65m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

May 25, 2022

Earnings per share (EPS)	0.23
Gross Margin	60.15%
Net Profit Margin	7.52%
Debt/Equity Ratio	0%

How did 2212 perform over the long term?

See historical performance and comparison

Dividends

0.4%

Current Dividend Yield

17%

Payout Ratio

Valuation

Is Topsec Technologies Group undervalued compared to its fair value and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

>50%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: 002212 (CN¥8.93) is trading below our estimate of fair value (CN¥25.15)

Significantly Below Fair Value: 002212 is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: 002212 is good value based on its Price-To-Earnings Ratio (39.6x) compared to the CN Software industry average (49.4x).

PE vs Market: 002212 is poor value based on its Price-To-Earnings Ratio (39.6x) compared to the CN market (31.3x).

Price to Earnings Growth Ratio

PEG Ratio: 002212 is good value based on its PEG Ratio (0.5x)

Price to Book Ratio

PB vs Industry: 002212 is good value based on its Price-To-Book Ratio (1.1x) compared to the CN Software industry average (2.9x).

Future Growth

How is Topsec Technologies Group forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

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

77.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 002212's forecast earnings growth (77.4% per year) is above the savings rate (3.3%).

Earnings vs Market: 002212's earnings (77.4% per year) are forecast to grow faster than the CN market (23.7% per year).

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

Revenue vs Market: 002212's revenue (33.1% per year) is forecast to grow faster than the CN market (17.3% per year).

High Growth Revenue: 002212's revenue (33.1% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if 002212's Return on Equity is forecast to be high in 3 years time

Past Performance

How has Topsec Technologies Group performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

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

11.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 002212 has a large one-off gain of CN¥82.3M impacting its March 31 2022 financial results.

Growing Profit Margin: 002212's current net profit margins (7.5%) are lower than last year (8.8%).

Past Earnings Growth Analysis

Earnings Trend: 002212's earnings have grown by 11% per year over the past 5 years.

Accelerating Growth: 002212's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 002212 had negative earnings growth (-43.6%) over the past year, making it difficult to compare to the Software industry average (-12.9%).

Return on Equity

High ROE: 002212's Return on Equity (2.8%) is considered low.

Financial Health

How is Topsec Technologies Group's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

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

Financial Position Analysis

Short Term Liabilities: 002212's short term assets (CN¥4.0B) exceed its short term liabilities (CN¥1.6B).

Long Term Liabilities: 002212's short term assets (CN¥4.0B) exceed its long term liabilities (CN¥111.5M).

Debt to Equity History and Analysis

Debt Level: 002212 is debt free.

Reducing Debt: 002212 has no debt compared to 5 years ago when its debt to equity ratio was 8.6%.

Debt Coverage: 002212 has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 002212 has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

Dividend

What is Topsec Technologies Group current dividend yield, its reliability and sustainability?

Dividend Score

1/6

Dividend Score 1/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

0.44%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 002212's dividend (0.44%) isn’t notable compared to the bottom 25% of dividend payers in the CN market (0.52%).

High Dividend: 002212's dividend (0.44%) is low compared to the top 25% of dividend payers in the CN market (2.03%).

Stability and Growth of Payments

Stable Dividend: 002212's dividend payments have been volatile in the past 10 years.

Growing Dividend: 002212's dividend payments have fallen over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (16.8%), 002212's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: 002212 is paying a dividend but the company has no free cash flows.

Discover strong dividend paying companies

Management

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

1.6yrs

Average board tenure

CEO

Topsec Technologies Group has no CEO, or we have no data on them.

Board Members

Experienced Board: 002212's board of directors are not considered experienced ( 1.6 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.

Data	Last Updated (UTC time)
Company Analysis	2022/05/24 00:00
End of Day Share Price	2022/05/24 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31