SEHK:1829

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China Machinery Engineering

Executive Summary

China Machinery Engineering Corporation, together with its subsidiaries, operates as an engineering contracting and services provider in Asia, South America, North America, Africa, and Europe. More Details


Snowflake Analysis

Very undervalued with excellent balance sheet and pays a dividend.

Share Price & News

How has China Machinery Engineering's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 1829's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-3.0%

1829

-3.8%

HK Construction

-2.6%

HK Market


1 Year Return

-52.0%

1829

-18.4%

HK Construction

-0.3%

HK Market

Return vs Industry: 1829 underperformed the Hong Kong Construction industry which returned -19.3% over the past year.

Return vs Market: 1829 underperformed the Hong Kong Market which returned 0.4% over the past year.


Shareholder returns

1829IndustryMarket
7 Day-3.0%-3.8%-2.6%
30 Day-15.3%-6.4%-4.2%
90 Day-22.0%2.5%0.7%
1 Year-47.5%-52.0%-14.1%-18.4%3.7%-0.3%
3 Year-57.5%-65.8%-34.9%-43.1%-5.1%-15.3%
5 Year-65.8%-74.8%-32.0%-43.7%25.0%4.0%

Price Volatility Vs. Market

How volatile is China Machinery Engineering's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is China Machinery Engineering 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: 1829 (HK$1.6) is trading below our estimate of fair value (HK$8.94)

Significantly Below Fair Value: 1829 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 1829 is good value based on its PE Ratio (3.2x) compared to the HK Construction industry average (8.5x).

PE vs Market: 1829 is good value based on its PE Ratio (3.2x) compared to the Hong Kong market (11.1x).


Price to Earnings Growth Ratio

PEG Ratio: 1829 is good value based on its PEG Ratio (0.3x)


Price to Book Ratio

PB vs Industry: 1829 is good value based on its PB Ratio (0.3x) compared to the HK Construction industry average (0.8x).


Next Steps

Future Growth

How is China Machinery Engineering forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

12.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1829's forecast earnings growth (12.6% per year) is above the savings rate (1.6%).

Earnings vs Market: 1829's earnings (12.6% per year) are forecast to grow slower than the Hong Kong market (22.4% per year).

High Growth Earnings: 1829's earnings are forecast to grow, but not significantly.

Revenue vs Market: 1829's revenue (12.2% per year) is forecast to grow slower than the Hong Kong market (13.1% per year).

High Growth Revenue: 1829's revenue (12.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1829's Return on Equity is forecast to be low in 3 years time (10.6%).


Next Steps

  • Explore growth companies in the Capital Goods industry.

Past Performance

How has China Machinery Engineering performed over the past 5 years?

-0.06%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 1829 has high quality earnings.

Growing Profit Margin: 1829's current net profit margins (7.8%) are higher than last year (7.2%).


Past Earnings Growth Analysis

Earnings Trend: 1829's earnings have declined by 0.06% per year over the past 5 years.

Accelerating Growth: 1829's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 1829 had negative earnings growth (-18%) over the past year, making it difficult to compare to the Construction industry average (-5.6%).


Return on Equity

High ROE: 1829's Return on Equity (10.2%) is considered low.


Next Steps

Financial Health

How is China Machinery Engineering's financial position?


Financial Position Analysis

Short Term Liabilities: 1829's short term assets (CN¥39.1B) exceed its short term liabilities (CN¥34.3B).

Long Term Liabilities: 1829's short term assets (CN¥39.1B) exceed its long term liabilities (CN¥1.8B).


Debt to Equity History and Analysis

Debt Level: 1829's debt to equity ratio (5.4%) is considered satisfactory.

Reducing Debt: 1829's debt to equity ratio has increased from 3.9% to 5.4% over the past 5 years.

Debt Coverage: 1829's debt is well covered by operating cash flow (92.2%).

Interest Coverage: 1829 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is China Machinery Engineering current dividend yield, its reliability and sustainability?

11.29%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 1829's dividend (11.29%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.24%).

High Dividend: 1829's dividend (11.29%) is in the top 25% of dividend payers in the Hong Kong market (6.92%)


Stability and Growth of Payments

Stable Dividend: 1829 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 1829 has only been paying a dividend for 7 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (35.9%), 1829's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 1829's dividends in 3 years are forecast to be well covered by earnings (29.7% payout ratio).


Next Steps

Management

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

3.1yrs

Average management tenure


CEO

Yanshui Fang (49 yo)

0.75

Tenure

CN¥1,447,000

Compensation

Mr. Yanshui Fang is an Executive Director at China Machinery Engineering Corporation since February 14, 2020. Mr. Fang has been the President at China Machinery Engineering Corporation since December 30, 2 ...


CEO Compensation Analysis

Compensation vs Market: Yanshui's total compensation ($USD212.63K) is below average for companies of similar size in the Hong Kong market ($USD462.71K).

Compensation vs Earnings: Insufficient data to compare Yanshui's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Yanshui Fang
President & Executive Director0.75yrCN¥1.45mno data
Weiling Wang
Chief Financial Officer2.58yrsno datano data
Jianguo Zhang
Vice President14.33yrsno datano data
Wei Ai
Vice President5.83yrsno datano data
Wei Zhang
Vice President5yrsno datano data
Zigang Tong
Vice President3.58yrsno datano data
Siu Man KR Kwok
Joint Company Secretary2.58yrsno datano data
Runhai Sun
Joint Company Secretary0.33yrno datano data

3.1yrs

Average Tenure

52yo

Average Age

Experienced Management: 1829's management team is considered experienced (3.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Yanshui Fang
President & Executive Director0.75yrCN¥1.45mno data
Shaotong Bai
Chairman of the Board0.75yrno datano data
Hong Yu Liu
Independent Non-Executive Director9.67yrsCN¥246.00kno data
Yongzhong Fang
Independent Non-Executive Director9.17yrsCN¥246.00kno data
Tak Lung Wu
Independent Non Executive Director6.58yrsCN¥246.00kno data
Li Liu
Independent Non-Executive Director9.67yrsCN¥246.00kno data
Fusheng Zhang
Non Executive Director6.58yrsCN¥116.00kno data
Benli Yu
Non Executive Director6.58yrsCN¥112.00kno data
Ting Liu
Deputy GM of the Audit Department & Staff Representative Supervisor2.67yrsno datano data
Weihua Guo
Shareholder Representative Supervisor1.25yrsno datano data
Huifang Wang
Chairman of Supervisory Board0.58yrno datano data

6.6yrs

Average Tenure

57yo

Average Age

Experienced Board: 1829's board of directors are considered experienced (6.6 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.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

China Machinery Engineering Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: China Machinery Engineering Corporation
  • Ticker: 1829
  • Exchange: SEHK
  • Founded: 1978
  • Industry: Construction and Engineering
  • Sector: Capital Goods
  • Market Cap: HK$6.601b
  • Shares outstanding: 4.13b
  • Website: https://www.cmec.com

Number of Employees


Location

  • China Machinery Engineering Corporation
  • CMEC Mansion
  • No. 178 Guang’anmenwai Street
  • Beijing
  • 100055
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
1829SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDDec 2012
C3MDB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEURDec 2012
CMEG.FOTCPK (Pink Sheets LLC)YesForeign Shares-Foreign ListedUSUSDDec 2012
CMYY.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDApr 2018

Biography

China Machinery Engineering Corporation, together with its subsidiaries, operates as an engineering contracting and services provider in Asia, South America, North America, Africa, and Europe. It operates ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/09/22 19:23
End of Day Share Price2020/09/22 00:00
Earnings2020/06/30
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.