SEHK:1316

Stock Analysis Report

Nexteer Automotive Group

Executive Summary

Nexteer Automotive Group Limited, an investment holding company, designs, develops, manufactures, and distributes steering and driveline systems and components for automobile manufacturers and other automotive-related companies.

Snowflake

Fundamentals

Flawless balance sheet and undervalued.


Similar Companies

Share Price & News

How has Nexteer Automotive Group's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

2.9%

1316

-1.5%

HK Auto Components

0.3%

HK Market


1 Year Return

-37.1%

1316

-14.4%

HK Auto Components

1.3%

HK Market

Return vs Industry: 1316 underperformed the Hong Kong Auto Components industry which returned -14.4% over the past year.

Return vs Market: 1316 underperformed the Hong Kong Market which returned 1.3% over the past year.


Shareholder returns

1316IndustryMarket
7 Day2.9%-1.5%0.3%
30 Day-4.2%-1.8%0.5%
90 Day-25.1%-5.0%-4.6%
1 Year-35.5%-37.1%-11.4%-14.4%4.9%1.3%
3 Year-34.9%-38.6%-18.5%-24.5%15.3%3.7%
5 Year3.4%-5.3%32.4%17.6%20.0%-0.006%

Price Volatility Vs. Market

How volatile is Nexteer Automotive Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Nexteer Automotive Group undervalued compared to its fair value and its price relative to the market?

46.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 1316 (HK$6.45) is trading below our estimate of fair value (HK$12.01)

Significantly Below Fair Value: 1316 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 1316 is good value based on its PE Ratio (6.6x) compared to the Auto Components industry average (11.5x).

PE vs Market: 1316 is good value based on its PE Ratio (6.6x) compared to the Hong Kong market (10.3x).


Price to Earnings Growth Ratio

PEG Ratio: 1316 is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: 1316 is overvalued based on its PB Ratio (1.2x) compared to the HK Auto Components industry average (1.1x).


Next Steps

Future Growth

How is Nexteer Automotive Group forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

7.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1316's forecast earnings growth (7.4% per year) is above the savings rate (2%).

Earnings vs Market: 1316's earnings (7.4% per year) are forecast to grow slower than the Hong Kong market (11.1% per year).

High Growth Earnings: 1316's earnings are forecast to grow, but not significantly.

Revenue vs Market: 1316's revenue (4.2% per year) is forecast to grow slower than the Hong Kong market (10% per year).

High Growth Revenue: 1316's revenue (4.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1316's Return on Equity is forecast to be low in 3 years time (14.9%).


Next Steps

Past Performance

How has Nexteer Automotive Group performed over the past 5 years?

18.8%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: 1316's earnings have grown by 18.8% per year over the past 5 years.

Accelerating Growth: 1316's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 1316 had negative earnings growth (-16.3%) over the past year, making it difficult to compare to the Auto Components industry average (4.4%).


Return on Equity

High ROE: 1316's Return on Equity (17.8%) is considered low.


Return on Assets

ROA vs Industry: 1316 has a higher Return on Assets than the Auto Components industry average last year.


Return on Capital Employed

ROCE Improving: 1316's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Nexteer Automotive Group's financial position?


Financial Position Analysis

Short Term Liabilities: 1316's short term assets ($1.5B) exceeds its short term liabilities ($819.3M)

Long Term Liabilities: 1316's short term assets (1.5B) exceeds its long term liabilities (568.9M)


Debt to Equity History and Analysis

Debt Level: 1316's debt to equity ratio (19.2%) is considered satisfactory

Reducing Debt: 1316's debt to equity ratio has reduced from 86.5% to 19.2% over the past 5 years.

Debt Coverage: 1316's debt is well covered by operating cash flow (156.9%).

Interest Coverage: 1316's interest payments on its debt are well covered by EBIT (116.1x coverage).


Balance Sheet

Inventory Level: 1316 has a high level of physical assets or inventory.

Debt Coverage by Assets: 1316's debt is covered by short term assets (assets are 4.4x debt).


Next Steps

Dividend

What is Nexteer Automotive Group's current dividend yield, its reliability and sustainability?

3.77%

Current Dividend Yield


Dividend Yield vs Market

company3.8%marketbottom25%2.3%markettop25%6.2%industryaverage4.3%forecastin3Years3.2%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: 1316's dividend (3.77%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.26%).

High Dividend: 1316's dividend (3.77%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.18%).

Stable Dividend: Whilst dividend payments have been stable, 1316 has been paying a dividend for less than 10 years.

Growing Dividend: 1316'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 (25%), 1316's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 1316's dividends in 3 years are forecast to be well covered by earnings (21.7% payout ratio).


Next Steps

Management

What is the CEO of Nexteer Automotive Group's salary, the management and board of directors tenure and is there insider trading?

3.0yrs

Average management tenure


CEO

Guibin Zhao (55yo)

7.3yrs

Tenure

US$1,184,000

Compensation

Mr. Guibin Zhao has been Chief Executive Officer of Nexteer Automotive Group Limited since June 2012 and has been its Vice Chairman since June 3, 2019. Mr. Zhao is responsible for setting Nexteer's strateg ...


CEO Compensation Analysis

Compensation vs. Market: Guibin's total compensation ($USD1.18M) is about average for companies of similar size in the Hong Kong market ($USD557.11K).

Compensation vs Earnings: Guibin's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

3.0yrs

Average Tenure

54yo

Average Age

Experienced Management: 1316's management team is considered experienced (3 years average tenure).


Board Age and Tenure

2.2yrs

Average Tenure

53yo

Average Age

Experienced Board: 1316's board of directors are not considered experienced ( 2.2 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

  • Guibin Zhao (55yo)

    Vice Chairman & CEO

    • Tenure: 7.3yrs
    • Compensation: US$1.18m
  • Mike Richardson (63yo)

    President & Executive Director

    • Tenure: 6.3yrs
    • Compensation: US$1.27m
  • Yi Fan (53yo)

    VP, Joint Company Secretary & Executive Director

    • Tenure: 7.2yrs
    • Compensation: US$584.00k
  • Tao Liu (54yo)

    Senior VP & Global COO

    • Tenure: 3yrs
  • Peter Ziparo (49yo)

    VP & General Counsel

    • Tenure: 2.8yrs
  • William Quigley (57yo)

    Senior VP & CFO

    • Tenure: 3.3yrs
  • Ot Benson (44yo)

    Vice President of Global Sales & Marketing

    • Tenure: 0.8yrs
  • Robin Milavec

    Senior VP

    • Tenure: 0.8yrs
  • Cameron Wang

    Investor Relations Director

    • Tenure: 0yrs
  • Lynn Pavlawk

    Executive Director of Global Marketing

    • Tenure: 0yrs

Board Members

  • Simon Yick (61yo)

    Independent Non-Executive Director

    • Tenure: 2.2yrs
    • Compensation: US$65.00k
  • Guibin Zhao (55yo)

    Vice Chairman & CEO

    • Tenure: 7.3yrs
    • Compensation: US$1.18m
  • Kevin Wei (51yo)

    Independent Non-Executive Director

    • Tenure: 6.3yrs
    • Compensation: US$65.00k
  • Mike Richardson (63yo)

    President & Executive Director

    • Tenure: 6.3yrs
    • Compensation: US$1.27m
  • Jian Wang (57yo)

    Non-Executive Chairman

    • Tenure: 0.3yrs
  • Yi Fan (53yo)

    VP, Joint Company Secretary & Executive Director

    • Tenure: 7.2yrs
    • Compensation: US$584.00k
  • Jianjun Liu (51yo)

    Independent Non-Executive Director

    • Tenure: 6.3yrs
    • Compensation: US$53.00k
  • Jianxun Zhang (39yo)

    Non-Executive Director

    • Tenure: 1.6yrs
    • Compensation: US$30.00k
  • Ping Liu (51yo)

    Non-Executive Director

    • Tenure: 0.3yrs

Company Information

Nexteer Automotive Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Nexteer Automotive Group Limited
  • Ticker: 1316
  • Exchange: SEHK
  • Founded: 1906
  • Industry: Auto Parts and Equipment
  • Sector: Automobiles
  • Market Cap: HK$15.923b
  • Shares outstanding: 2.51b
  • Website: https://www.nexteer.com

Number of Employees


Location

  • Nexteer Automotive Group Limited
  • 1272 Doris Road
  • Auburn Hills
  • Michigan
  • 48326
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
1316SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDOct 2013
NTXV.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDOct 2013
1316SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesOrdinary SharesHKHKDOct 2013
1316SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesOrdinary SharesHKHKDOct 2013

Biography

Nexteer Automotive Group Limited, an investment holding company, designs, develops, manufactures, and distributes steering and driveline systems and components for automobile manufacturers and other automo ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/23 12:47
End of Day Share Price2019/10/23 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.