DB:HB8

Stock Analysis Report

Huishang Bank

Executive Summary

Huishang Bank Corporation Limited, together with its subsidiaries, provides various commercial banking products and services in the People’s Republic of China.

Snowflake

Fundamentals

Very undervalued with flawless balance sheet.

Share Price & News

How has Huishang Bank's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-0.6%

HB8

1.5%

DE Banks

1.4%

DE Market


1 Year Return

-12.2%

HB8

-30.0%

DE Banks

3.7%

DE Market

Return vs Industry: HB8 exceeded the German Banks industry which returned -30% over the past year.

Return vs Market: HB8 underperformed the German Market which returned 3.7% over the past year.


Shareholder returns

HB8IndustryMarket
7 Day-0.6%1.5%1.4%
30 Day-5.7%-1.0%1.3%
90 Day-5.3%-8.4%3.4%
1 Year-10.3%-12.2%-27.8%-30.0%7.0%3.7%
3 Year-12.8%-16.9%-5.9%-10.6%18.5%8.3%
5 Year23.4%6.0%-12.8%-33.9%42.2%22.9%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

Is Huishang Bank undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: HB8 (€0.32) is trading below our estimate of fair value (€1.46)

Significantly Undervalued: HB8 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: HB8 is good value based on its PE Ratio (3.5x) compared to the Banks industry average (15.7x).

PE vs Market: HB8 is good value based on its PE Ratio (3.5x) compared to the German market (19.3x).


Price to Earnings Growth Ratio

Low PEG Ratio: HB8 is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: HB8 is good value based on its PB Ratio (0.5x) compared to the DE Banks industry average (0.8x).


Next Steps

Future Growth

How is Huishang Bank forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

9.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HB8's forecast earnings growth (9.4% per year) is above the savings rate (0.2%).

Earnings vs Market: HB8's earnings (9.4% per year) are forecast to grow slower than the German market (12.7% per year).

High Growth Earnings: HB8's earnings are forecast to grow, but not significantly.

Revenue vs Market: HB8's revenue (14.4% per year) is forecast to grow faster than the German market (5% per year).

High Growth Revenue: HB8's revenue (14.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: HB8's Return on Equity is forecast to be low in 3 years time (12.5%).


Next Steps

Past Performance

How has Huishang Bank performed over the past 5 years?

9.8%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: HB8's earnings have grown by 9.8% per year over the past 5 years.

Accelerating Growth: HB8's earnings growth over the past year (16.4%) exceeds its 5-year average (9.8% per year).

Earnings vs Industry: HB8 earnings growth over the past year (16.4%) exceeded the Banks industry -11.7%.


Return on Equity

High ROE: HB8's Return on Equity (12.9%) is considered low.


Return on Assets

ROA vs Industry: HB8 has a higher Return on Assets than the Banks industry average last year.


Return on Capital Employed

ROCE Improving: Insufficient data to calculate HB8's Return on Capital Employed to determine if it has improved over the past 3 years.


Next Steps

Financial Health

How is Huishang Bank's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: HB8 has a low level of unsold assets or inventory.

Debt Coverage by Assets: HB8's debt is covered by short term assets (assets are 1.427250x debt).


Financial Institutions Analysis

Asset Level: HB8's level of assets compared to its equity is moderate.

Allowance for Bad Loans: HB8 has a sufficient allowance for bad loans.

Low Risk Liabilities: HB8's liabilities are made up of primarily low risk sources of funding.

Loan Level: HB8 has an acceptable proportion of non-loan assets held.

Low Risk Deposits: HB8's loans are broadly funded by customer deposits.

Level of Bad Loans: HB8 has an appropriate level of bad loans (0.93%)


Next Steps

Dividend

What is Huishang Bank's current dividend yield, its reliability and sustainability?

2.17%

Current Dividend Yield


Dividend Yield vs Market

company2.2%marketbottom25%1.5%markettop25%3.8%industryaverage3.7%forecastin3Years2.7%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: HB8's dividend (2.17%) is higher than the bottom 25% of dividend payers in the German market (1.47%).

High Dividend: HB8's dividend (2.17%) is low compared to the top 25% of dividend payers in the German market (3.83%).

Stable Dividend: HB8 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: HB8 has only been paying a dividend for 5 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (7.5%), HB8's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HB8's dividends in 3 years are forecast to be thoroughly covered by earnings (8% payout ratio).


Next Steps

Management

What is the CEO of Huishang Bank's salary, the management and board of directors tenure and is there insider trading?

1.2yrs

Average management tenure


CEO

Renfu Zhang (57yo)

1.2yrs

Tenure

CN¥692,000

Compensation

Mr. Renfu Zhang has been President of Huishang Bank Corporation Ltd. since August 23, 2018 and it's Director since December 28, 2018. He had served as Executive Officer of Huishang Bank Corporation Ltd. fr ...


CEO Compensation Analysis

Compensation vs. Market: Renfu has recently become CEO, making it difficult to compare their total compensation against companies of similar size in the German market.

Compensation vs Earnings: Renfu's compensation has been consistent with company performance over the past year.


Management Age and Tenure

1.2yrs

Average Tenure

54yo

Average Age

Experienced Management: HB8's management team is not considered experienced ( 1.2 years average tenure), which suggests a new team.


Board Age and Tenure

1.0yrs

Average Tenure

55.5yo

Average Age

Experienced Board: HB8's board of directors are not considered experienced ( 1 years average tenure), which suggests a new board.


Insider Trading

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


Ownership Breakdown


Management Team

  • Maurice Ngai (57yo)

    Joint Company Secretary

    • Tenure: 6.3yrs
  • Jiehua He (53yo)

    Executive Director

    • Tenure: 0.2yrs
  • Xuemin Wu (51yo)

    Chairman of the Board

    • Tenure: 1.8yrs
    • Compensation: CN¥703.00k
  • Renfu Zhang (57yo)

    President & Director

    • Tenure: 1.2yrs
    • Compensation: CN¥692.00k
  • Min Xia (48yo)

    Head of Financial Dept

    • Tenure: 0yrs
    • Compensation: CN¥1.67m
  • Tong Zhou (54yo)

    GM of Compliance Department and Director of Compliance & Risk Management

    • Tenure: 0yrs
    • Compensation: CN¥325.00k
  • Dawei Li (55yo)

    GM of Financial Accounting Department & Financial Controller

    • Tenure: 0yrs
  • Chuan Tang (57yo)

    GM of HR Department

    • Tenure: 1.6yrs
  • Xiaoyan Huang (48yo)

    GM of Asset & Liability Management Department and Director of Investment & Wealth Management

    • Tenure: 0yrs
  • Baohua Lian (54yo)

    GM of Research & Development Department and Secretary to the Board

    • Tenure: 1.2yrs

Board Members

  • Yang Gao (53yo)

    Non-Executive Director

    • Tenure: 9.8yrs
  • Jiehua He (53yo)

    Executive Director

    • Tenure: 0.2yrs
  • Xuemin Wu (51yo)

    Chairman of the Board

    • Tenure: 1.8yrs
    • Compensation: CN¥703.00k
  • Renfu Zhang (57yo)

    President & Director

    • Tenure: 1.2yrs
    • Compensation: CN¥692.00k
  • Tian Wu (55yo)

    Non-Executive Director

    • Tenure: 0.8yrs
  • Youqi Zhang (54yo)

    Chairman of the Board of Supervisors

    • Tenure: 1.3yrs
    • Compensation: CN¥1.32m
  • Yana Zhou (65yo)

    Independent Non-Executive Director

    • Tenure: 1.2yrs
    • Compensation: CN¥100.00k
  • Chuan Tang (57yo)

    GM of HR Department

    • Tenure: 1.6yrs
  • Peikun Dai (66yo)

    Independent Non-Executive Director

    • Tenure: 0.8yrs
  • Xiaolin Dong (56yo)

    External Supervisor

    • Tenure: 0.9yrs

Company Information

Huishang Bank Corporation Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Huishang Bank Corporation Limited
  • Ticker: HB8
  • Exchange: DB
  • Founded: 1997
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: HK$34.641b
  • Listing Market Cap: HK$3.965b
  • Shares outstanding: 12.15b
  • Website: https://www.hsbank.com.cn

Number of Employees


Location

  • Huishang Bank Corporation Limited
  • Tianhui Building
  • Block A
  • Hefei
  • Anhui Province
  • 230001
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
3698SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDNov 2013
HB8DB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEURNov 2013
A1882LDB (Deutsche Boerse AG)5.5%-STP SUB BDS PERP USD1000 'REGS'DEEURJan 2017

Biography

Huishang Bank Corporation Limited, together with its subsidiaries, provides various commercial banking products and services in the People’s Republic of China. It operates through four segments: Corporate  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/19 21:41
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.