SEHK:1727

Stock Analysis Report

Hebei Construction Group

Executive Summary

Hebei Construction Group Corporation Limited engages in the construction contracting of buildings and infrastructure projects in the People's Republic of China.

Snowflake

Fundamentals

High growth potential with mediocre balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 1727 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.2%

1727

-0.1%

HK Construction

-0.02%

HK Market


1 Year Return

32.3%

1727

-17.5%

HK Construction

0.6%

HK Market

Return vs Industry: 1727 exceeded the Hong Kong Construction industry which returned -17.5% over the past year.

Return vs Market: 1727 exceeded the Hong Kong Market which returned 0.6% over the past year.


Shareholder returns

1727IndustryMarket
7 Day3.2%-0.1%-0.02%
30 Day1.7%-0.5%1.4%
90 Day-5.1%-0.9%3.8%
1 Year39.8%32.3%-13.8%-17.5%4.2%0.6%
3 Yearn/a-26.1%-34.1%20.4%8.3%
5 Yearn/a-13.2%-26.5%18.9%-0.9%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Hebei Construction Group undervalued compared to its fair value and its price relative to the market?

10.97x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 1727 (HK$5.53) is trading above our estimate of fair value (HK$3.72)

Significantly Below Fair Value: 1727 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 1727 is poor value based on its PE Ratio (11x) compared to the Construction industry average (10.3x).

PE vs Market: 1727 is poor value based on its PE Ratio (11x) compared to the Hong Kong market (10.3x).


Price to Earnings Growth Ratio

PEG Ratio: 1727 is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: 1727 is overvalued based on its PB Ratio (1.6x) compared to the HK Construction industry average (1.1x).


Next Steps

Future Growth

How is Hebei Construction Group forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

28.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1727's forecast earnings growth (28% per year) is above the savings rate (2%).

Earnings vs Market: 1727's earnings (28% per year) are forecast to grow faster than the Hong Kong market (11.6% per year).

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

Revenue vs Market: 1727's revenue (15.2% per year) is forecast to grow faster than the Hong Kong market (10.1% per year).

High Growth Revenue: 1727's revenue (15.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1727's Return on Equity is forecast to be high in 3 years time (21.2%)


Next Steps

Past Performance

How has Hebei Construction Group performed over the past 5 years?

14.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 1727 has high quality earnings.

Growing Profit Margin: 1727's current net profit margins (1.7%) are lower than last year (3.4%).


Past Earnings Growth Analysis

Earnings Trend: 1727's earnings have grown by 14.5% per year over the past 5 years.

Accelerating Growth: 1727's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 1727 had negative earnings growth (-42.2%) over the past year, making it difficult to compare to the Construction industry average (-10.2%).


Return on Equity

High ROE: 1727's Return on Equity (15.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Hebei Construction Group's financial position?


Financial Position Analysis

Short Term Liabilities: 1727's short term assets (CN¥56.6B) exceeds its short term liabilities (CN¥51.8B)

Long Term Liabilities: 1727's short term assets (CN¥56.6B) exceeds its long term liabilities (2.0B)


Debt to Equity History and Analysis

Debt Level: 1727's debt to equity ratio (72%) is considered high.

Reducing Debt: Insufficient data to determine if 1727's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: 1727's debt is not well covered by operating cash flow (3.3%).

Interest Coverage: 1727's interest payments on its debt are well covered by EBIT (17.4x coverage).


Balance Sheet

Inventory Level: 1727 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 1727's debt is covered by short term assets (assets are 14x debt).


Next Steps

Dividend

What is Hebei Construction Group's current dividend yield, its reliability and sustainability?

6.04%

Current Dividend Yield


Dividend Yield vs Market

company6.0%marketbottom25%2.3%markettop25%6.3%industryaverage4.7%forecastin3Years5.2%

Current dividend yield vs market & industry

Notable Dividend: 1727's dividend (6.04%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.25%).

High Dividend: 1727's dividend (6.04%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.33%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether 1727's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if 1727's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (66.3%), 1727's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 1727's dividends in 3 years are forecast to be well covered by earnings (30.1% payout ratio).


Next Steps

Management

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

5.4yrs

Average management tenure


CEO

Jinfeng Shang (42yo)

2.7yrs

Tenure

CN¥808,000

Compensation

Mr. Jinfeng Shang has been President and Executive Director of Hebei Construction Group Corporation Limited since March 31, 2017. Mr. Shang serves as the General Manager of Baoding Mancheng District Zhongb ...


CEO Compensation Analysis

Compensation vs Market: Jinfeng's total compensation ($USD114.99K) is below average for companies of similar size in the Hong Kong market ($USD496.66K).

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


Management Age and Tenure

5.4yrs

Average Tenure

47.5yo

Average Age

Experienced Management: 1727's management team is seasoned and experienced (5.4 years average tenure).


Board Age and Tenure

2.7yrs

Average Tenure

49.5yo

Average Age

Experienced Board: 1727's board of directors are not considered experienced ( 2.7 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.


Recent Insider Transactions

SellCN¥66,060,03715 Jan 19
Wei Zhang
EntityIndividual
Shares18,000,000
Max PriceCN¥3.67

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 13.8%.


Management Team

  • Baozhong Li (49yo)

    Executive Chairman of the Board

    • Tenure: 3.9yrs
    • Compensation: CN¥991.00k
  • Jinfeng Shang (42yo)

    President & Executive Director

    • Tenure: 2.7yrs
    • Compensation: CN¥808.00k
  • Yongjian Liu (55yo)

    VP & Executive Director

    • Tenure: 5.9yrs
    • Compensation: CN¥943.00k
  • Jingqiao Liu (57yo)

    Director of Party & Administration Office and Employee Supervisor

    • Tenure: 2.7yrs
  • Xiujian Feng (41yo)

    Vice Chief Accountant

    • Tenure: 6.8yrs
  • Jianming Yue (46yo)

    Head of Legal Affairs Department & Employee Supervisor

    • Tenure: 2.7yrs
  • Feng Wang (39yo)

    Deputy Head of Enterprise Management Dept.

    • Tenure: 2.7yrs
  • Wutie Li (32yo)

    Joint Company Secretary & Assistant to the President

    • Tenure: 1.9yrs
  • Qiuli Gao (55yo)

    VP & Chief Engineer

    • Tenure: 18.3yrs
    • Compensation: CN¥518.00k
  • Wensheng Zhao (50yo)

    Chief Accountant

    • Tenure: 0.8yrs

Board Members

  • Baozhong Li (49yo)

    Executive Chairman of the Board

    • Tenure: 3.9yrs
    • Compensation: CN¥991.00k
  • Jinfeng Shang (42yo)

    President & Executive Director

    • Tenure: 2.7yrs
    • Compensation: CN¥808.00k
  • Yongjian Liu (55yo)

    VP & Executive Director

    • Tenure: 5.9yrs
    • Compensation: CN¥943.00k
  • Baoyuan Li (68yo)

    Honorary Chairman

    • Tenure: 3.9yrs
    • Compensation: CN¥884.00k
  • Qingshe Cao (54yo)

    Vice Chairman of the Board

    • Tenure: 2.7yrs
    • Compensation: CN¥817.00k
  • Jingqiao Liu (57yo)

    Director of Party & Administration Office and Employee Supervisor

    • Tenure: 2.7yrs
  • Xiujian Feng (41yo)

    Vice Chief Accountant

    • Tenure: 6.8yrs
  • Jianming Yue (46yo)

    Head of Legal Affairs Department & Employee Supervisor

    • Tenure: 2.7yrs
  • Feng Wang (39yo)

    Deputy Head of Enterprise Management Dept.

    • Tenure: 2.7yrs
  • Wensheng Zhao (50yo)

    Chief Accountant

    • Tenure: 0.8yrs

Company Information

Hebei Construction Group Corporation Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Hebei Construction Group Corporation Limited
  • Ticker: 1727
  • Exchange: SEHK
  • Founded: 1952
  • Industry: Construction and Engineering
  • Sector: Capital Goods
  • Market Cap: HK$9.881b
  • Shares outstanding: 1.76b
  • Website: https://www.hebjs.com.cn

Number of Employees


Location

  • Hebei Construction Group Corporation Limited
  • 125 Lugang Road
  • Jingxiu District
  • Baoding
  • Hebei Province
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
1727SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDDec 2017

Biography

Hebei Construction Group Corporation Limited engages in the construction contracting of buildings and infrastructure projects in the People's Republic of China. The company operates through two segments, C ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/11/20 13:10
End of Day Share Price2019/11/20 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.