SEHK:2277

Stock Analysis Report

Huarong Investment Stock

Executive Summary

Huarong Investment Stock Corporation Limited, an investment holding company, engages in the investment, financial services and others, and foundation and substructure construction businesses in the People’s Republic of China.


Snowflake Analysis

Fair value with mediocre balance sheet.


Similar Companies

Share Price & News

How has Huarong Investment Stock's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 2277 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

10.7%

2277

-2.3%

HK Construction

-3.2%

HK Market


1 Year Return

-15.1%

2277

-28.6%

HK Construction

-10.2%

HK Market

Return vs Industry: 2277 exceeded the Hong Kong Construction industry which returned -28.6% over the past year.

Return vs Market: 2277 underperformed the Hong Kong Market which returned -10.2% over the past year.


Shareholder returns

2277IndustryMarket
7 Day10.7%-2.3%-3.2%
30 Day19.2%-4.3%-3.3%
90 Day19.2%-5.9%0.2%
1 Year-15.1%-15.1%-25.1%-28.6%-6.9%-10.2%
3 Year-76.2%-76.2%-35.3%-42.3%11.7%0.4%
5 Year-76.2%-76.2%-27.7%-38.4%11.1%-7.3%

Price Volatility Vs. Market

How volatile is Huarong Investment Stock's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Huarong Investment Stock 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: 2277 (HK$0.31) is trading below our estimate of fair value (HK$50.71)

Significantly Below Fair Value: 2277 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 2277 is unprofitable, so we can't compare its PE Ratio to the Construction industry average.

PE vs Market: 2277 is unprofitable, so we can't compare its PE Ratio to the Hong Kong market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 2277's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 2277 is good value based on its PB Ratio (0.3x) compared to the HK Construction industry average (1x).


Next Steps

Future Growth

How is Huarong Investment Stock forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

10.9%

Forecasted Capital Goods industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Huarong Investment Stock has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Huarong Investment Stock performed over the past 5 years?

-17.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 2277 is currently unprofitable.

Growing Profit Margin: 2277 is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: 2277 is unprofitable, and losses have increased over the past 5 years at a rate of -17.9% per year.

Accelerating Growth: Unable to compare 2277's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 2277 is unprofitable, making it difficult to compare its past year earnings growth to the Construction industry (-5.4%).


Return on Equity

High ROE: 2277 has a negative Return on Equity (-15.89%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Huarong Investment Stock's financial position?


Financial Position Analysis

Short Term Liabilities: 2277's short term assets (HK$6.9B) exceed its short term liabilities (HK$3.8B).

Long Term Liabilities: 2277's short term assets (HK$6.9B) exceed its long term liabilities (HK$4.7B).


Debt to Equity History and Analysis

Debt Level: 2277's debt to equity ratio (399.3%) is considered high.

Reducing Debt: 2277's debt to equity ratio has increased from 19.3% to 399.3% over the past 5 years.


Balance Sheet

Inventory Level: 2277 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 2277's debt is not covered by short term assets (assets are 0.9x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: 2277 has been profitable on average in the past, therefore cash runway is not a concern.

Forecast Cash Runway: 2277 has been profitable on average in the past, therefore cash runway is not a concern.


Next Steps

Dividend

What is Huarong Investment Stock's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%2.3%markettop25%6.4%industryaverage4.6%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate 2277's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 2277's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 2277's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 2277's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 2277's dividend in 3 years as they are not forecast to pay a notable one for the Hong Kong market.


Next Steps

Management

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

1.8yrs

Average board tenure


CEO

Xiaowu Xu (49yo)

0.6yrs

Tenure

HK$2,583,400

Compensation

Mr. Xiaowu Xu serves as Chief Executive Officer and Executive Director of Huarong Investment Stock Corporation Limited since July 8, 2019. Mr. Xu has been Chief Executive Officer and Executive Director of  ...


CEO Compensation Analysis

Compensation vs Market: Xiaowu's total compensation ($USD331.40K) is above average for companies of similar size in the Hong Kong market ($USD226.90K).

Compensation vs Earnings: Xiaowu's compensation has increased whilst the company is unprofitable.


Board Members

NamePositionTenureCompensationOwnership
Meng Yu
Chairman of the Board1.3yrsHK$1.66mno data
Xiaowu Xu
CEO, Chief Supervisor & Director0.6yrsHK$2.58mno data
Qinghua Chen
Executive Director & Deputy CEO0.2yrsno datano data
Lee Lam
Independent Non-Executive Director2.4yrsHK$240.00kno data
Chi Wai Tse
Independent Non-Executive Director3.8yrsHK$240.00kno data
Kee Huen Chan
Independent Non-Executive Director3.7yrsHK$240.00kno data

1.8yrs

Average Tenure

50yo

Average Age

Experienced Board: 2277's board of directors are not considered experienced ( 1.8 years average tenure), which suggests a new board.


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

Huarong Investment Stock Corporation Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Huarong Investment Stock Corporation Limited
  • Ticker: 2277
  • Exchange: SEHK
  • Founded: 1993
  • Industry: Construction and Engineering
  • Sector: Capital Goods
  • Market Cap: HK$562.960m
  • Shares outstanding: 1.82b
  • Website: https://www.hriv.com.hk

Number of Employees


Location

  • Huarong Investment Stock Corporation Limited
  • Two Pacific Place
  • Suite B
  • Hong Kong
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2277SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDDec 2014

Biography

Huarong Investment Stock Corporation Limited, an investment holding company, engages in the investment, financial services and others, and foundation and substructure construction businesses in the People’s Republic of China. The company invests in equities, bonds, funds, derivative instruments, and other financial products; and offers finance lease, business consulting, and other related services. It also undertakes excavation and lateral support works; and pile cap and substructure construction for residential, commercial, and infrastructure projects, as well as rents related equipment. In addition, Huarong Investment Stock Corporation Limited provides securities trading and financial advisory services. The company was formerly known as Chun Sing Engineering Holdings Limited and changed its name to Huarong Investment Stock Corporation Limited in October 2016. Huarong Investment Stock Corporation Limited was founded in 1993 and is headquartered in Hong Kong, Hong Kong. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/25 13:17
End of Day Share Price2020/02/24 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.