SEHK:3328

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Bank of Communications

Executive Summary

Bank of Communications Co., Ltd. provides commercial banking products and services primarily in the People’s Republic of China, Hong Kong, Macau, Taiwan, and internationally.


Snowflake Analysis

Flawless balance sheet, undervalued and pays a dividend.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 3328 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.6%

3328

1.7%

HK Banks

0.5%

HK Market


1 Year Return

-17.8%

3328

-8.9%

HK Banks

6.6%

HK Market

Return vs Industry: 3328 underperformed the Hong Kong Banks industry which returned -8.4% over the past year.

Return vs Market: 3328 underperformed the Hong Kong Market which returned 7.2% over the past year.


Shareholder returns

3328IndustryMarket
7 Day2.6%1.7%0.5%
30 Day-4.0%-4.4%-0.8%
90 Day-8.8%-7.3%9.4%
1 Year-11.9%-17.8%-3.2%-8.9%11.0%6.6%
3 Year-7.6%-23.1%-8.7%-22.3%3.2%-7.8%
5 Year-5.0%-29.8%11.3%-15.8%22.5%1.9%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Bank of Communications 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: 3328 (HK$4.33) is trading below our estimate of fair value (HK$11.31)

Significantly Below Fair Value: 3328 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 3328 is good value based on its PE Ratio (4x) compared to the HK Banks industry average (5x).

PE vs Market: 3328 is good value based on its PE Ratio (4x) compared to the Hong Kong market (10.4x).


Price to Earnings Growth Ratio

PEG Ratio: 3328 is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: 3328's PB Ratio (0.4x) is in line with the HK Banks industry average.


Next Steps

Future Growth

How is Bank of Communications forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

5.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 3328's forecast earnings growth (5.1% per year) is above the savings rate (1.6%).

Earnings vs Market: 3328's earnings (5.1% per year) are forecast to grow slower than the Hong Kong market (18.6% per year).

High Growth Earnings: 3328's earnings are forecast to grow, but not significantly.

Revenue vs Market: 3328's revenue (6.6% per year) is forecast to grow slower than the Hong Kong market (11.3% per year).

High Growth Revenue: 3328's revenue (6.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 3328's Return on Equity is forecast to be low in 3 years time (9.9%).


Next Steps

Past Performance

How has Bank of Communications performed over the past 5 years?

2.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 3328 has high quality earnings.

Growing Profit Margin: 3328's current net profit margins (41.1%) are higher than last year (40.3%).


Past Earnings Growth Analysis

Earnings Trend: 3328's earnings have grown by 2.6% per year over the past 5 years.

Accelerating Growth: 3328's earnings growth over the past year (4.1%) exceeds its 5-year average (2.6% per year).

Earnings vs Industry: 3328 earnings growth over the past year (4.1%) underperformed the Banks industry 4.8%.


Return on Equity

High ROE: 3328's Return on Equity (9.5%) is considered low.


Next Steps

Financial Health

How is Bank of Communications'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


Financial Institutions Analysis

Asset Level: 3328's Assets to Equity ratio (12.7x) is moderate.

Allowance for Bad Loans: 3328 has a sufficient allowance for bad loans (136%).

Low Risk Liabilities: 72% of 3328's liabilities are made up of primarily low risk sources of funding.

Loan Level: 3328 has an appropriate level of Loans to Assets ratio (52%).

Low Risk Deposits: 3328's Loans to Deposits ratio (79%) is appropriate.

Level of Bad Loans: 3328 has an appropriate level of bad loans (1.6%).


Next Steps

Dividend

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

8.12%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 3328's dividend (8.13%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.38%).

High Dividend: 3328's dividend (8.13%) is in the top 25% of dividend payers in the Hong Kong market (6.8%)


Stability and Growth of Payments

Stable Dividend: 3328's dividend payments have been volatile in the past 10 years.

Growing Dividend: 3328's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (32.3%), 3328's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 3328's dividends in 3 years are forecast to be well covered by earnings (31% payout ratio).


Next Steps

Management

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

0.9yrs

Average management tenure


CEO

Jun Liu (48 yo)

0.25

Tenure

Mr. Jun Liu serves as President at Bank of Communications Co., Ltd. since May 29, 2020 and serves as its Vice Chairman since August 5, 2020. He serves as an Executice Director of Bank of Communications Co. ...


Leadership Team

NamePositionTenureCompensationOwnership
Deqi Ren
Executive Chairman1.33yrsCN¥779.00k0.00013%
CN¥ 468.1k
Mang Guo
Executive VP & Head of Accountingno dataCN¥716.90k0.000070%
CN¥ 252.1k
Sheng Gu
GM of HR Department2.33yrsCN¥1.16m0.00012%
CN¥ 432.1k
Hong Tu
Chief Business Officer of Interbank & Market Business1.92yrsCN¥1.18m0.000070%
CN¥ 252.1k
Jiuyong Yin
Executive Vice President0.92yrCN¥298.60kno data
Jun Liu
Vice Chairman & President0.25yrno datano data
Eric Pan
Senior Managerno datano datano data
Zhao Wu
Strategic Cooperation Consultant7.42yrsno datano data
Chris J. Durack
Co-Head of Asia Pacific0.42yrno datano data
Susan Soh
Co-Head of Asia Pacific0.42yrno datano data
Chen Wei
Head of Accounting Institutionno datano datano data
Junkang Xu
General Managerno datano datano data

0.9yrs

Average Tenure

57yo

Average Age

Experienced Management: 3328's management team is not considered experienced ( 0.9 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Deqi Ren
Executive Chairman1.33yrsCN¥779.00k0.00013%
CN¥ 468.1k
Jun Liu
Vice Chairman & President0.25yrno datano data
Chi Wai Yeung
Independent Non-Executive Director3.83yrsCN¥282.00kno data
Haoyi Cai
Independent Non-Executive Director2yrsno datano data
Jian Li
Independent Non-Executive Director5.83yrsCN¥292.00kno data
Li Liu
Independent Non-Executive Director5.92yrsCN¥292.00kno data
Haoyang Liu
Non-Executive Director4yrsno datano data
Chin Wan Woo
Independent Non-Executive Director2.75yrsCN¥282.00kno data
Zhaobin He
Non-Executive Director3yrsCN¥863.00k0.000030%
CN¥ 108.0k
Guobin Song
Non-Executive Director3yrsCN¥863.00k0.000030%
CN¥ 108.0k
Hongjun Song
Non-Executive Director1yrno datano data
Siu Chan
Non-Executive Director0.83yrno data0.000070%
CN¥ 252.1k

3.0yrs

Average Tenure

57yo

Average Age

Experienced Board: 3328's board of directors are considered experienced (3 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.


Top Shareholders

Company Information

Bank of Communications Co., Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Bank of Communications Co., Ltd.
  • Ticker: 3328
  • Exchange: SEHK
  • Founded: 1908
  • Industry: Diversified Banks
  • Sector: Banks
  • Market Cap: HK$360.103b
  • Shares outstanding: 74.26b
  • Website: https://www.bankcomm.com

Number of Employees


Location

  • Bank of Communications Co., Ltd.
  • 188 Yin Cheng Zhong Lu
  • China (Shanghai) Pilot Free Trade Zone
  • Shanghai
  • Shanghai Province
  • 200120
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
3328SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDJun 2005
C4CDB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEURJun 2005
BKFC.FOTCPK (Pink Sheets LLC)YesForeign Shares-Foreign ListedUSUSDJun 2005
3328SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDJun 2005
3328SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDJun 2005
601328SHSE (Shanghai Stock Exchange)Domestic SharesCNCNYMay 2007
601328XSSC (Shanghai Stock Exchange - Shanghai - Hong Kong Stock Connect)Domestic SharesCNCNYMay 2007
BCMX.YOTCPK (Pink Sheets LLC)ADRUSUSDOct 2008

Biography

Bank of Communications Co., Ltd. provides commercial banking products and services primarily in the People’s Republic of China, Hong Kong, Macau, Taiwan, and internationally. The company offers personal ba ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/08/14 07:56
End of Day Share Price2020/08/13 00:00
Earnings2020/03/31
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.