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Hebei Construction Group

SEHK:1727
Snowflake Description

Reasonable growth potential with adequate balance sheet.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
1727
SEHK
HK$11B
Market Cap
  1. Home
  2. HK
  3. Capital Goods
Company description

Hebei Construction Group Corporation Limited engages in the construction contracting of buildings and infrastructure projects in the People's Republic of China. The last earnings update was 88 days ago. More info.


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1727 Share Price and Events
7 Day Returns
6.5%
SEHK:1727
1.1%
HK Construction
0.8%
HK Market
1 Year Returns
32.5%
SEHK:1727
-11.1%
HK Construction
-4.4%
HK Market
1727 Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Hebei Construction Group (1727) 6.5% -4.9% 2.6% 32.5% - -
HK Construction 1.1% -4.7% -13.3% -11.1% -21.2% -4.5%
HK Market 0.8% 1.5% -7.4% -4.4% 17.7% 1.6%
1 Year Return vs Industry and Market
  • 1727 outperformed the Construction industry which returned -11.1% over the past year.
  • 1727 outperformed the Market in Hong Kong which returned -4.4% over the past year.
Price Volatility
Industry
5yr Volatility vs Market

Value

 Is Hebei Construction Group undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Hebei Construction Group to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Hebei Construction Group.

SEHK:1727 Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 1 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 9.2%
Perpetual Growth Rate 10-Year HK Government Bond Rate 2%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for SEHK:1727
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year HK Govt Bond Rate 2%
Equity Risk Premium S&P Global 6%
Construction Unlevered Beta Simply Wall St/ S&P Global 1.04
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 1.036 (1 + (1- 25%) (35.93%))
1.211
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.21
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2% + (1.211 * 5.96%)
9.22%

Discounted Cash Flow Calculation for SEHK:1727 using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Hebei Construction Group is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

SEHK:1727 DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (CNY, Millions) Source Present Value
Discounted (@ 9.22%)
2020 440.88 Est @ -40.3% 403.65
2021 319.15 Est @ -27.61% 267.53
2022 259.39 Est @ -18.73% 199.07
2023 226.95 Est @ -12.51% 159.47
2024 208.44 Est @ -8.15% 134.10
2025 197.80 Est @ -5.11% 116.50
2026 191.91 Est @ -2.97% 103.49
2027 189.07 Est @ -1.48% 93.35
2028 188.25 Est @ -0.44% 85.09
2029 188.80 Est @ 0.3% 78.14
Present value of next 10 years cash flows CN¥1,640.39
SEHK:1727 DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= CN¥188.80 × (1 + 2%) ÷ (9.22% – 2%)
CN¥2,667.40
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= CN¥2,667.40 ÷ (1 + 9.22%)10
CN¥1,103.95
SEHK:1727 Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= CN¥1,640.39 + CN¥1,103.95
CN¥2,744.34
Equity Value per Share
(CNY)
= Total value / Shares Outstanding
= CN¥2,744.34 / 1,761.38
CN¥1.56
SEHK:1727 Discount to Share Price
Calculation Result
Exchange Rate CNY/HKD
(Reporting currency to currency of SEHK:1727)
1.135
Value per Share
(HKD)
= Value per Share in CNY x Exchange Rate (CNY/HKD)
= CN¥1.56 x 1.135
HK$1.77
Value per share (HKD) From above. HK$1.77
Current discount Discount to share price of HK$6.24
= -1 x (HK$6.24 - HK$1.77) / HK$1.77
-253%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

  • The current share price of Hebei Construction Group is above its future cash flow value.
Often investors are willing to pay a premium for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Hebei Construction Group's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Hebei Construction Group's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
SEHK:1727 PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-12-31) in CNY CN¥0.63
SEHK:1727 Share Price ** SEHK (2019-07-19) in HKD HK$6.24
SEHK:1727 Share Price converted to CNY reporting currency Exchange rate (HKD/ CNY) 0.881 CN¥5.5
Hong Kong Construction Industry PE Ratio Median Figure of 105 Publicly-Listed Construction Companies 10.19x
Hong Kong Market PE Ratio Median Figure of 1,511 Publicly-Listed Companies 10.76x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Hebei Construction Group.

SEHK:1727 PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= SEHK:1727 Share Price ÷ EPS (both in CNY)

= 5.5 ÷ 0.63

8.71x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Hebei Construction Group is good value based on earnings compared to the HK Construction industry average.
  • Hebei Construction Group is good value based on earnings compared to the Hong Kong market.
Price based on expected Growth
Does Hebei Construction Group's expected growth come at a high price?
Raw Data
SEHK:1727 PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 8.71x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 1 Analysts
16.5%per year
Hong Kong Construction Industry PEG Ratio Median Figure of 10 Publicly-Listed Construction Companies 0.56x
Hong Kong Market PEG Ratio Median Figure of 480 Publicly-Listed Companies 0.8x

*Line of best fit is calculated by linear regression .

SEHK:1727 PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 8.71x ÷ 16.5%

0.53x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Hebei Construction Group is good value based on expected growth next year.
Price based on value of assets
What value do investors place on Hebei Construction Group's assets?
Raw Data
SEHK:1727 PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-12-31) in CNY CN¥2.94
SEHK:1727 Share Price * SEHK (2019-07-19) in HKD HK$6.24
SEHK:1727 Share Price converted to CNY reporting currency Exchange rate (HKD/ CNY) 0.881 CN¥5.5
Hong Kong Construction Industry PB Ratio Median Figure of 136 Publicly-Listed Construction Companies 1.37x
Hong Kong Market PB Ratio Median Figure of 2,197 Publicly-Listed Companies 0.92x
SEHK:1727 PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= SEHK:1727 Share Price ÷ Book Value per Share (both in CNY)

= 5.5 ÷ 2.94

1.87x

* Primary Listing of Hebei Construction Group.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Hebei Construction Group is overvalued based on assets compared to the HK Construction industry average.
X
Value checks
We assess Hebei Construction Group's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Construction industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Construction industry average (and greater than 0)? (1 check)
  5. Hebei Construction Group has a total score of 3/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

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

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
16.5%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Hebei Construction Group expected to grow at an attractive rate?
  • Hebei Construction Group's earnings growth is expected to exceed the low risk savings rate of 2%.
Growth vs Market Checks
  • Hebei Construction Group's earnings growth is expected to exceed the Hong Kong market average.
  • Hebei Construction Group's revenue growth is expected to exceed the Hong Kong market average.
Annual Growth Rates Comparison
Raw Data
SEHK:1727 Future Growth Rates Data Sources
Data Point Source Value (per year)
SEHK:1727 Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 1 Analysts 16.5%
SEHK:1727 Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 1 Analysts 13.4%
Hong Kong Construction Industry Earnings Growth Rate Market Cap Weighted Average 11.8%
Hong Kong Construction Industry Revenue Growth Rate Market Cap Weighted Average 9.6%
Hong Kong Market Earnings Growth Rate Market Cap Weighted Average 11.3%
Hong Kong Market Revenue Growth Rate Market Cap Weighted Average 10.7%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
SEHK:1727 Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 1 Analyst Estimates (S&P Global) See Below
All numbers in CNY Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
SEHK:1727 Future Estimates Data
Date (Data in CNY Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2021-12-31 69,811 908 1,795 1
2020-12-31 60,903 485 1,477 1
2019-12-31 53,183 538 1,217 1
SEHK:1727 Past Financials Data
Date (Data in CNY Millions) Revenue Cash Flow Net Income *
2018-12-31 46,649 939 1,113
2018-09-30 43,507 718 1,106
2018-06-30 40,365 497 1,100
2018-03-31 40,771 11 1,063
2017-12-31 41,177 -475 1,026
2017-09-30 40,612 -551 1,098
2017-06-30 40,047 -628 1,169
2017-03-31 39,328 817 1,087
2016-12-31 38,609 2,262 1,005

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Hebei Construction Group's earnings are expected to grow by 16.5% yearly, however this is not considered high growth (20% yearly).
  • Hebei Construction Group's revenue is expected to grow by 13.4% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
SEHK:1727 Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 1 Analyst Estimates (S&P Global) See Below

All data from Hebei Construction Group Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

SEHK:1727 Future Estimates Data
Date (Data in CNY Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2021-12-31 1.02 1.02 1.02 1.00
2020-12-31 0.84 0.84 0.84 1.00
2019-12-31 0.69 0.69 0.69 1.00
SEHK:1727 Past Financials Data
Date (Data in CNY Millions) EPS *
2018-12-31 0.63
2018-09-30 0.67
2018-06-30 0.71
2018-03-31 0.74
2017-12-31 0.78
2017-09-30 0.86
2017-06-30 0.94
2017-03-31 0.89
2016-12-31 0.84

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Hebei Construction Group is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).
X
Future performance checks
We assess Hebei Construction Group's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the Hong Kong market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Hong Kong market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Hebei Construction Group has a total score of 4/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

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

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Hebei Construction Group's growth in the last year to its industry (Construction).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Hebei Construction Group's year on year earnings growth rate has been positive over the past 5 years.
  • Hebei Construction Group's 1-year earnings growth is less than its 5-year average (8.5% vs 19.6%)
  • Hebei Construction Group's earnings growth has exceeded the HK Construction industry average in the past year (8.5% vs -13.1%).
Earnings and Revenue History
Hebei Construction Group's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Hebei Construction Group Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

SEHK:1727 Past Revenue, Cash Flow and Net Income Data
Date (Data in CNY Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-12-31 46,649.24 1,112.52 466.25
2018-09-30 43,507.08 1,106.43 447.91
2018-06-30 40,364.92 1,100.34 429.56
2018-03-31 40,771.13 1,062.93 446.06
2017-12-31 41,177.34 1,025.52 462.56
2017-09-30 40,612.27 1,097.51 444.98
2017-06-30 40,047.20 1,169.50 427.40
2017-03-31 39,328.30 1,087.40 409.53
2016-12-31 38,609.40 1,005.31 391.65
2015-12-31 27,215.65 539.09 265.53
2014-12-31 24,859.14 366.58 258.62

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Hebei Construction Group has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Hebei Construction Group used its assets less efficiently than the HK Construction industry average last year based on Return on Assets.
  • Hebei Construction Group has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Hebei Construction Group's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Construction industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Hebei Construction Group has a total score of 3/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is Hebei Construction Group's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Hebei Construction Group's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Hebei Construction Group is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Hebei Construction Group's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Hebei Construction Group's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • Low level of unsold assets.
  • Debt is covered by short term assets, assets are 16.5x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Hebei Construction Group Company Filings, last reported 6 months ago.

SEHK:1727 Past Debt and Equity Data
Date (Data in CNY Millions) Total Equity Total Debt Cash & Short Term Investments
2018-12-31 5,688.39 3,480.22 9,130.62
2018-09-30 5,688.39 3,480.22 9,130.62
2018-06-30 5,020.30 3,712.35 4,391.40
2018-03-31 5,020.30 3,712.35 4,391.40
2017-12-31 4,311.31 3,569.14 8,143.51
2017-09-30 4,311.31 3,569.14 8,143.51
2017-06-30 2,468.33 3,769.49 6,042.59
2017-03-31 2,468.33 3,769.49 6,042.59
2016-12-31 3,089.68 3,856.54 6,994.53
2015-12-31 2,171.77 5,471.45 5,422.44
2014-12-31 1,946.13 4,772.47 4,194.69
  • Hebei Construction Group's level of debt (61.2%) compared to net worth is high (greater than 40%).
  • Unable to establish if Hebei Construction Group's debt level has increased without past 5-year debt data.
  • Debt is well covered by operating cash flow (27%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 21.2x coverage).
X
Financial health checks
We assess Hebei Construction Group's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Hebei Construction Group has a total score of 4/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

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

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
5.46%
Current annual income from Hebei Construction Group dividends. Estimated to be 4.67% next year.
If you bought HK$2,000 of Hebei Construction Group shares you are expected to receive HK$109 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Hebei Construction Group's pays a higher dividend yield than the bottom 25% of dividend payers in Hong Kong (2.07%).
  • Hebei Construction Group's dividend is below the markets top 25% of dividend payers in Hong Kong (5.71%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
SEHK:1727 Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 1 Analyst Estimates (S&P Global) See Below
Hong Kong Construction Industry Average Dividend Yield Market Cap Weighted Average of 43 Stocks 3.9%
Hong Kong Market Average Dividend Yield Market Cap Weighted Average of 978 Stocks 3.6%
Hong Kong Minimum Threshold Dividend Yield 10th Percentile 1.2%
Hong Kong Bottom 25% Dividend Yield 25th Percentile 2.1%
Hong Kong Top 25% Dividend Yield 75th Percentile 5.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

SEHK:1727 Future Dividends Estimate Data
Date (Data in CN¥) Dividend per Share (annual) Avg. No. Analysts
2021-12-31 0.31 1.00
2020-12-31 0.25 1.00
2019-12-31 0.21 1.00
SEHK:1727 Past Annualized Dividends Data
Date (Data in CN¥) Dividend per share (annual) Avg. Yield (%)
2019-04-23 0.300 5.831
2019-03-25 0.300 5.216

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • It is too early to tell whether Hebei Construction Group has stable dividend payments.
  • Hebei Construction Group only just started paying a dividend, it is too early to tell if payments are increasing.
Current Payout to shareholders
What portion of Hebei Construction Group's earnings are paid to the shareholders as a dividend.
  • Dividends paid are well covered by earnings (2.1x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be well covered by earnings (3.3x coverage).
X
Income/ dividend checks
We assess Hebei Construction Group's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.2%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Hebei Construction Group afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Hebei Construction Group has a total score of 3/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

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

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Jinfeng Shang
COMPENSATION CN¥808,000
AGE 42
TENURE AS CEO 2.3 years
CEO Bio

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 Zhongbao Investment Co., Ltd. Mr. Shang has over 19 years of experience in the construction engineering industry and corporate management. His previous primary work experience included as a Technician, the person in charge of technology and the Project Manager of HCG Tianchen Construction Engineering from July 1998 to October 2008, Vice General Manager in charge of production of HCG Tianchen Construction Engineering from March 2008 to December 2010, a Standing Vice General Manager and the General Manager of HCG Tianchen Construction Engineering from December 2010 to January 2017 and a Vice President and a Standing Vice President of Hebei Construction Group Corporation Limited from December 2013 to March 2017. He joined the Hebei Construction Group Corporation Limited in July 1998. He serves as a director of HCG Tianchen Construction Engineering and Hebei Lvjian Investment Company. Mr. Shang obtained the qualifications of national certified constructor from the Ministry of Construction of the PRC in January 2008 and senior engineer from the Qualification Reform Leading Group Office of Hebei Province in December 2013. Mr. Shang was accredited the Wusi Youth Medal of Baoding City jointly from China Communist Youth League Baoding Committee, Bureau of Human Resources and Social Security of Baoding and Baoding Youth Federation in May 2012. Mr. Shang has been awarded as the Excellent Enterprise Manager in Construction Industry by Hebei Building Industry Association for five times from 2012 to 2017 and a second-level candidate of New Century Triple Talents Project of Hebei Province by Leading Group of Triple Talents Project of Hebei Province in December 2015. Mr. Shang obtained an undergraduate diploma in urban construction from the Agricultural University of Hebei Province in Baoding, the PRC in July 1998 and an EMBA degree from Peking University in Beijing, the PRC in January 2016.

CEO Compensation
  • Jinfeng's compensation has been consistent with company performance over the past year, both up more than 20%.
  • Jinfeng's remuneration is lower than average for companies of similar size in Hong Kong.
Management Team Tenure

Average tenure and age of the Hebei Construction Group management team in years:

5
Average Tenure
47.5
Average Age
  • The average tenure for the Hebei Construction Group management team is over 5 years, this suggests they are a seasoned and experienced team.
Management Team

Baozhong Li

TITLE
Executive Chairman of the Board
COMPENSATION
CN¥991K
AGE
49
TENURE
3.6 yrs

Jinfeng Shang

TITLE
President & Executive Director
COMPENSATION
CN¥808K
AGE
42
TENURE
2.3 yrs

Yongjian Liu

TITLE
VP & Executive Director
COMPENSATION
CN¥943K
AGE
55
TENURE
11.5 yrs

Xiujian Feng

TITLE
Vice Chief Accountant
AGE
41

Wensheng Zhao

TITLE
Chief Accountant
AGE
50
TENURE
6.5 yrs

Jingqiao Liu

TITLE
Director of Party & Administration Office and Employee Supervisor
AGE
57

Jianming Yue

TITLE
Head of Legal Affairs Department & Employee Supervisor
AGE
46

Feng Wang

TITLE
Deputy Head of Enterprise Management Dept.
AGE
39

Qiuli Gao

TITLE
VP & Chief Engineer
COMPENSATION
CN¥518K
AGE
55
TENURE
18 yrs

Wutie Li

TITLE
Joint Company Secretary & Assistant to the President
AGE
32
TENURE
1.6 yrs
Board of Directors Tenure

Average tenure and age of the Hebei Construction Group board of directors in years:

2.3
Average Tenure
49.5
Average Age
  • The average tenure for the Hebei Construction Group board of directors is less than 3 years, this suggests a new board.
Board of Directors

Baozhong Li

TITLE
Executive Chairman of the Board
COMPENSATION
CN¥991K
AGE
49
TENURE
3.6 yrs

Jinfeng Shang

TITLE
President & Executive Director
COMPENSATION
CN¥808K
AGE
42
TENURE
2.3 yrs

Qingshe Cao

TITLE
Vice Chairman of the Board
COMPENSATION
CN¥817K
AGE
54
TENURE
2.3 yrs

Baoyuan Li

TITLE
Honorary Chairman
COMPENSATION
CN¥884K
AGE
68
TENURE
3.6 yrs

Yongjian Liu

TITLE
VP & Executive Director
COMPENSATION
CN¥943K
AGE
55
TENURE
5.6 yrs

Xiujian Feng

TITLE
Vice Chief Accountant
AGE
41
TENURE
6.5 yrs

Wensheng Zhao

TITLE
Chief Accountant
AGE
50
TENURE
0.4 yrs

Jingqiao Liu

TITLE
Director of Party & Administration Office and Employee Supervisor
AGE
57
TENURE
2.3 yrs

Jianming Yue

TITLE
Head of Legal Affairs Department & Employee Supervisor
AGE
46
TENURE
2.3 yrs

Feng Wang

TITLE
Deputy Head of Enterprise Management Dept.
AGE
39
TENURE
2.3 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month individual insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (HK$) Value (HK$)
15. Jan 19 Sell Wei Zhang Individual 14. Jan 19 14. Jan 19 -18,000,000 HK$3.67 HK$-66,060,037
06. Dec 18 Sell Wei Zhang Individual 05. Nov 18 05. Nov 18 -13,500,000 HK$4.27 HK$-57,644,955
05. Nov 18 Sell Wei Zhang Individual 30. Oct 18 30. Oct 18 -14,100,000 HK$4.08 HK$-57,489,876
13. Aug 18 Sell Panhou Capital Management Limited Company 31. Jul 18 31. Jul 18 -29,996,000 HK$4.68 HK$-140,381,343
X
Management checks
We assess Hebei Construction Group's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Hebei Construction Group has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

Is It Too Late To Buy Hebei Construction Group Corporation Limited (HKG:1727) At Its July Price?

Hebei Construction Group Corporation Limited (HKG:1727) closed yesterday at HK$5.86, which left some investors asking whether the high earnings potential can still be justified at this price. … Hebei Construction Group is poised for extremely high earnings growth in the near future. … But, seeing as Hebei Construction Group is perceived as a high-growth stock, we must also account for its earnings growth, which is captured in the PEG ratio.

Simply Wall St -

Do You Like Hebei Construction Group Corporation Limited (HKG:1727) At This P/E Ratio?

View our latest analysis for Hebei Construction Group How Do You Calculate Hebei Construction Group's P/E Ratio? … The formula for price to earnings is: Price to Earnings Ratio = Share Price (in reporting currency) ÷ Earnings per Share (EPS) Or for Hebei Construction Group: P/E of 9.23 = CN¥5.83 (Note: this is the share price in the reporting currency, namely, CNY ) ÷ CN¥0.63 (Based on the year to December 2018.) Is A High Price-to-Earnings Ratio Good? … Hebei Construction Group saw earnings per share decrease by 19% last year.

Simply Wall St -

Hebei Construction Group Corporation Limited (HKG:1727) Delivered A Better ROE Than Its Industry

The formula for ROE is: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Hebei Construction Group: 20% = CN¥1.1b ÷ CN¥5.7b (Based on the trailing twelve months to December 2018.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. … Does Hebei Construction Group Have A Good Return On Equity? … Hebei Construction Group's Debt And Its 20% ROE While Hebei Construction Group does have some debt, with debt to equity of just 0.61, we wouldn't say debt is excessive.

Simply Wall St -

Are Hebei Construction Group Corporation Limited's (HKG:1727) Interest Costs Too High?

While small-cap stocks, such as Hebei Construction Group Corporation Limited (HKG:1727) with its market cap of HK$11b, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn.

Simply Wall St -

Update: Hebei Construction Group (HKG:1727) Stock Gained 32% In The Last Year

For example, the Hebei Construction Group Corporation Limited (HKG:1727) share price is up 32% in the last year, clearly besting than the market return of around -10% (not including dividends). … During the last year, Hebei Construction Group actually saw its earnings per share drop 25%. … Revenue was pretty stable on last year, so deeper research might be needed to explain the share price rise.

Simply Wall St -

Here's How P/E Ratios Can Help Us Understand Hebei Construction Group Corporation Limited (HKG:1727)

To keep it practical, we'll show how Hebei Construction Group Corporation Limited's (HKG:1727) P/E ratio could help you assess the value on offer. … Price to Earnings Ratio = Share Price (in reporting currency) ÷ Earnings per Share (EPS) … P/E of 6.52 = CN¥4.63 (Note: this is the share price in the reporting currency, namely, CNY ) ÷ CN¥0.71

Simply Wall St -

Can Hebei Construction Group Corporation Limited (HKG:1727) Maintain Its Strong Returns?

With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. … To keep the lesson grounded in practicality, we'll use ROE to better understand Hebei Construction Group Corporation Limited (HKG:1727). … One way to conceptualize this, is that for each HK$1 of shareholders' equity it has, the company made HK$0.22 in profit.

Simply Wall St -

Have Investors Priced In Hebei Construction Group Corporation Limited's (HKG:1727) Growth?

Hebei Construction Group Corporation Limited (HKG:1727) closed yesterday at HK$4.32, which left some investors asking whether the high earnings potential can still be justified at this price. … What can we expect from Hebei Construction Group in the future. … According to the analysts covering the company, the following few years should bring about good growth prospects for Hebei Construction Group

Simply Wall St -

What You Need To Know About Hebei Construction Group Corporation Limited’s (HKG:1727) Cash Situation

Two important questions to ask before you buy Hebei Construction Group Corporation Limited (HKG:1727) is, how it makes money and how it spends its cash. … Today we will examine Hebei Construction Group’s ability to generate cash flows, as well as the level of capital expenditure it is expected to incur over the next couple of years, which will result in how much money goes to you. … Hebei Construction Group generates cash through its day-to-day business, which needs to be reinvested into the company in order for it to continue operating

Simply Wall St -

Hebei Construction Group Corporation Limited (HKG:1727) Insiders Increased Their Holdings

So shareholders might well want to know whether insiders have been buying or selling shares in Hebei Construction Group Corporation Limited (HKG:1727). … The Last 12 Months Of Insider Transactions At Hebei Construction Group. … In total, Hebei Construction Group insiders bought more than they sold over the last year

Simply Wall St -

Company Info

Description

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, Construction Contracting and Others. It undertakes construction contracting works of residential, public, industrial, and commercial buildings; and municipal and transportation infrastructure, including facilities for water supply and treatment, gas and heating, urban pipelines, roads, bridges, and airport runways, as well as specialized construction works, including electrical and mechanical installation, steel structure, and decoration and fireproofing projects. The company also develops and manages properties. Hebei Construction Group Corporation Limited was founded in 1952 and is headquartered in Baoding, the People's Republic of China.

Details
Name: Hebei Construction Group Corporation Limited
1727
Exchange: SEHK
Founded: 1952
HK$10,991,033,040
1,761,383,500
Website: http://www.hebjs.com.cn
Address: Hebei Construction Group Corporation Limited
125 Lugang Road,
Jingxiu District,
Baoding,
Hebei Province, China
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
SEHK 1727 Foreign Shares-Foreign Listed The Stock Exchange of Hong Kong Ltd. HK HKD 15. Dec 2017
Number of employees
Current staff
Staff numbers
6,800
Hebei Construction Group employees.
Industry
Construction and Engineering
Capital Goods
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/07/20 13:05
End of day share price update: 2019/07/19 00:00
Last estimates confirmation: 2019/06/24
Last earnings filing: 2019/04/23
Last earnings reported: 2018/12/31
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.