SEHK:1183

Stock Analysis Report

MECOM Power and Construction

Executive Summary

MECOM Power and Construction Limited, an investment holding company, operates as an integrated construction engineering contractor in Macau.

Snowflake

Fundamentals

Flawless balance sheet with poor track record.

Share Price & News

How has MECOM Power and Construction's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

4.4%

1183

-0.2%

HK Construction

0.9%

HK Market


1 Year Return

-6.9%

1183

-17.5%

HK Construction

0.6%

HK Market

Return vs Industry: 1183 exceeded the Hong Kong Construction industry which returned -17.5% over the past year.

Return vs Market: 1183 underperformed the Hong Kong Market which returned 0.6% over the past year.


Shareholder returns

1183IndustryMarket
7 Day4.4%-0.2%0.9%
30 Day5.6%-4.5%0.5%
90 Day-7.8%-10.5%-4.3%
1 Year-4.3%-6.9%-14.0%-17.5%4.2%0.6%
3 Yearn/a-24.4%-32.9%15.6%4.0%
5 Yearn/a0.9%-14.3%20.0%-0.08%

Price Volatility Vs. Market

How volatile is MECOM Power and Construction's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is MECOM Power and Construction undervalued compared to its fair value and its price relative to the market?

30.2x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 1183 (HK$0.95) is trading above our estimate of fair value (HK$0.29)

Significantly Below Fair Value: 1183 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 1183 is poor value based on its PE Ratio (30.2x) compared to the Construction industry average (10.1x).

PE vs Market: 1183 is poor value based on its PE Ratio (30.2x) compared to the Hong Kong market (10.3x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 1183's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 1183 is overvalued based on its PB Ratio (2.9x) compared to the HK Construction industry average (1.1x).


Next Steps

Future Growth

How is MECOM Power and Construction forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

0.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1183's forecast earnings growth (0.2% per year) is below the savings rate (2%).

Earnings vs Market: 1183's earnings (0.2% per year) are forecast to grow slower than the Hong Kong market (11.3% per year).

High Growth Earnings: 1183's earnings are forecast to grow, but not significantly.

Revenue vs Market: Insufficient data to determine if 1183's revenue is forecast to grow faster than the Hong Kong market.

High Growth Revenue: Insufficient data to determine if 1183's revenue 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 1183's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has MECOM Power and Construction performed over the past 5 years?

-12.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: 1183's earnings have declined by -12.6% per year over the past 5 years.

Accelerating Growth: 1183's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 1183 had negative earnings growth (-42%) over the past year, making it difficult to compare to the Construction industry average (-12.3%).


Return on Equity

High ROE: 1183's Return on Equity (9.5%) is considered low.


Return on Assets

ROA vs Industry: 1183 has a higher Return on Assets than the Construction industry average last year.


Return on Capital Employed

ROCE Improving: 1183's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is MECOM Power and Construction's financial position?


Financial Position Analysis

Short Term Liabilities: 1183's short term assets (MOP482.1M) exceeds its short term liabilities (MOP133.6M)

Long Term Liabilities: 1183 has no long term liabilities


Debt to Equity History and Analysis

Debt Level: 1183 is debt free.

Reducing Debt: 1183 had no debt 5 years ago.

Debt Coverage: 1183 has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 1183 has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: 1183 has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if 1183's debt is covered by short term assets.


Next Steps

Dividend

What is MECOM Power and Construction's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

company0%marketbottom25%2.3%markettop25%6.3%industryaverage4.7%forecastin3Yearsn/a

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: Unable to evaluate 1183's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 1183's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if 1183's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 1183's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: 1183 is not paying a notable dividend for the Hong Kong market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 1183's dividend in 3 years as they are not forecast to pay a notable one for the Hong Kong market.


Next Steps

Management

What is the CEO of MECOM Power and Construction's salary, the management and board of directors tenure and is there insider trading?

1.8yrs

Average board tenure


CEO

Sou Tou (52yo)

0yrs

Tenure

MO$4,201,000

Compensation

Mr. Sou Kun Tou serves as an Executive Director, Deputy Chairman of the Board and Chief Executive Officer of the MECOM Power and Construction. He was appointed as a Director in May 2017 and was re-designat ...


CEO Compensation Analysis

Compensation vs. Market: Insufficient data to establish whether Sou's total compensation is reasonable compared to companies of similar size in the Hong Kong market.

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


Board Age and Tenure

1.8yrs

Average Tenure

55yo

Average Age

Experienced Board: 1183's board of directors are not considered experienced ( 1.8 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

  • Sou Tou (52yo)

    Deputy Chairman of the Board & CEO

    • Tenure: 0yrs
    • Compensation: MO$4.20m
  • Lam Kuok (56yo)

    Chairman

    • Tenure: 0yrs
    • Compensation: MO$4.20m
  • Kuok Lam (45yo)

    Chief Operating Officer

    • Tenure: 0yrs
  • Wing Tam (37yo)

    Finance Manager & Company Secretary

    • Tenure: 0yrs

Board Members

  • Vincent Cheung (43yo)

    Independent Non-Executive Director

    • Tenure: 1.8yrs
    • Compensation: MO$278.00k
  • Patsy Chan (55yo)

    Independent Non-Executive Director

    • Tenure: 1.8yrs
    • Compensation: MO$278.00k
  • Sou Tou (52yo)

    Deputy Chairman of the Board & CEO

    • Tenure: 0yrs
    • Compensation: MO$4.20m
  • Lam Kuok (56yo)

    Chairman

    • Tenure: 0yrs
    • Compensation: MO$4.20m
  • Matthew Ngan (79yo)

    Independent Non-executive Directors

    • Tenure: 1.8yrs
    • Compensation: MO$278.00k

Company Information

MECOM Power and Construction Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: MECOM Power and Construction Limited
  • Ticker: 1183
  • Exchange: SEHK
  • Founded: 2000
  • Industry: Construction and Engineering
  • Sector: Capital Goods
  • Market Cap: HK$1.102b
  • Shares outstanding: 1.20b
  • Website: https://www.mecommacau.com

Number of Employees


Location

  • MECOM Power and Construction Limited
  • Praça Kin Heng Long-Heng Hoi Kuok
  • Units Q, R and S, 6th Floor
  • Macau
  • Macau

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
1183SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDFeb 2018

Biography

MECOM Power and Construction Limited, an investment holding company, operates as an integrated construction engineering contractor in Macau. It provides steel structure erection services, including structu ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/21 13:01
End of Day Share Price2019/10/21 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.