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Huarong Investment Stock

SEHK:2277
Snowflake Description

Fair value with moderate growth potential.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
2277
SEHK
HK$726M
Market Cap
  1. Home
  2. HK
  3. Capital Goods
Company description

Huarong Investment Stock Corporation Limited, an investment holding company, engages in investment, financial services and others, and foundation and substructure construction businesses in the People’s Republic of China. The last earnings update was 81 days ago. More info.


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2277 Share Price and Events
7 Day Returns
-4.9%
SEHK:2277
-0.5%
HK Construction
-0.2%
HK Market
1 Year Returns
-9.3%
SEHK:2277
-11.4%
HK Construction
-4.5%
HK Market
2277 Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Huarong Investment Stock (2277) -4.9% -2.5% -1.3% -9.3% -80.5% -
HK Construction -0.5% -3.6% -14% -11.4% -21.9% -4.9%
HK Market -0.2% 2.7% -8.3% -4.5% 16.5% 1%
1 Year Return vs Industry and Market
  • 2277 outperformed the Construction industry which returned -11.4% over the past year.
  • 2277 underperformed the Market in Hong Kong which returned -4.5% over the past year.
Price Volatility
2277
Industry
5yr Volatility vs Market

Value

 Is Huarong Investment Stock 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 Huarong Investment Stock 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 Huarong Investment Stock.

SEHK:2277 Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Extrapolated from most recent financials. See below
Discount Rate (Cost of Equity) See below 15.3%
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:2277
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year HK Govt Bond Rate 2%
Equity Risk Premium S&P Global 6.7%
Construction Unlevered Beta Simply Wall St/ S&P Global 1.03
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 1.035 (1 + (1- 25%) (1065.21%))
6.561
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
2
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2% + (2 * 6.65%)
15.3%

Discounted Cash Flow Calculation for SEHK:2277 using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Huarong Investment Stock 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:2277 DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (HKD, Millions) Source Present Value
Discounted (@ 15.3%)
2020 4,387.81 Est @ 44.58% 3,805.46
2021 5,783.49 Est @ 31.81% 4,350.20
2022 7,105.98 Est @ 22.87% 4,635.56
2023 8,286.10 Est @ 16.61% 4,688.00
2024 9,299.17 Est @ 12.23% 4,562.90
2025 10,150.90 Est @ 9.16% 4,319.77
2026 10,862.72 Est @ 7.01% 4,009.17
2027 11,461.20 Est @ 5.51% 3,668.64
2028 11,972.10 Est @ 4.46% 3,323.57
2029 12,417.60 Est @ 3.72% 2,989.73
Present value of next 10 years cash flows HK$40,353.01
SEHK:2277 DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= HK$12,417.60 × (1 + 2%) ÷ (15.3% – 2%)
HK$95,235.54
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= HK$95,235.54 ÷ (1 + 15.3%)10
HK$22,929.42
SEHK:2277 Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= HK$40,353.01 + HK$22,929.42
HK$63,282.43
Equity Value per Share
(HKD)
= Total value / Shares Outstanding
= HK$63,282.43 / 1,816.00
HK$34.85
SEHK:2277 Discount to Share Price
Calculation Result
Value per share (HKD) From above. HK$34.85
Current discount Discount to share price of HK$0.39
= -1 x (HK$0.39 - HK$34.85) / HK$34.85
98.9%

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

Current Discount
Amount off the current price Huarong Investment Stock is available for.
Intrinsic value
>50%
Share price is HK$0.39 vs Future cash flow value of HK$34.85
Current Discount Checks
For Huarong Investment Stock to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Huarong Investment Stock's share price is below the future cash flow value, and at a moderate discount (> 20%).
  • Huarong Investment Stock's share price is below the future cash flow value, and at a substantial discount (> 40%).
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 Huarong Investment Stock's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Huarong Investment Stock's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
SEHK:2277 PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-12-31) in HKD HK$0.01
SEHK:2277 Share Price ** SEHK (2019-07-19) in HKD HK$0.39
Hong Kong Construction Industry PE Ratio Median Figure of 105 Publicly-Listed Construction Companies 10.19x
Hong Kong Market PE Ratio Median Figure of 1,510 Publicly-Listed Companies 10.72x

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

** Primary Listing of Huarong Investment Stock.

SEHK:2277 PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= SEHK:2277 Share Price ÷ EPS (both in HKD)

= 0.39 ÷ 0.01

76.58x

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

  • Huarong Investment Stock is overvalued based on earnings compared to the HK Construction industry average.
  • Huarong Investment Stock is overvalued based on earnings compared to the Hong Kong market.
Price based on expected Growth
Does Huarong Investment Stock's expected growth come at a high price?
Raw Data
SEHK:2277 PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 76.58x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 0 Analysts
25.4%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 479 Publicly-Listed Companies 0.79x

*Line of best fit is calculated by linear regression .

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

  • Unable to calculate PEG ratio for Huarong Investment Stock, we can't assess if its growth is good value.
Price based on value of assets
What value do investors place on Huarong Investment Stock's assets?
Raw Data
SEHK:2277 PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-12-31) in HKD HK$1.22
SEHK:2277 Share Price * SEHK (2019-07-19) in HKD HK$0.39
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:2277 PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= SEHK:2277 Share Price ÷ Book Value per Share (both in HKD)

= 0.39 ÷ 1.22

0.32x

* Primary Listing of Huarong Investment Stock.

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

  • Huarong Investment Stock is good value based on assets compared to the HK Construction industry average.
X
Value checks
We assess Huarong Investment Stock'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. Huarong Investment Stock 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 Huarong Investment Stock expected to perform in the next 1 to 3 years based on estimates from 0 analysts?

  • No analysts cover Huarong Investment Stock, future earnings growth has been estimated based on fundamentals.
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
25.4%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Huarong Investment Stock expected to grow at an attractive rate?
  • Huarong Investment Stock's earnings growth is expected to exceed the low risk savings rate of 2%.
Growth vs Market Checks
  • Huarong Investment Stock's earnings growth is expected to exceed the Hong Kong market average.
  • Unable to compare Huarong Investment Stock's revenue growth to the Hong Kong market average as no estimate data is available.
Annual Growth Rates Comparison
Raw Data
SEHK:2277 Future Growth Rates Data Sources
Data Point Source Value (per year)
SEHK:2277 Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 0 Analysts 25.4%
Hong Kong Construction Industry Earnings Growth Rate Market Cap Weighted Average 11.9%
Hong Kong Construction Industry Revenue Growth Rate Market Cap Weighted Average 9.6%
Hong Kong Market Earnings Growth Rate Market Cap Weighted Average 11.4%
Hong Kong Market Revenue Growth Rate Market Cap Weighted Average 10.6%

*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:2277 Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 0 Analyst Estimates (S&P Global) See Below
All numbers in HKD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
SEHK:2277 Future Estimates Data
Date (Data in HKD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
SEHK:2277 Past Financials Data
Date (Data in HKD Millions) Revenue Cash Flow Net Income *
2018-12-31 1,496 3,075 9
2018-09-30 1,445 136 121
2018-06-30 1,394 -2,804 233
2018-03-31 1,152 -3,899 251
2017-12-31 910 -4,994 270
2016-12-31 867 -555 208
2016-09-30 747 -237 34
2016-06-30 769 -83 39
2016-03-31 792 71 44

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Huarong Investment Stock's earnings are expected to grow significantly at over 20% yearly.
  • Unable to determine if Huarong Investment Stock is high growth as no revenue estimate data is available.
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:2277 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 0 Analyst Estimates (S&P Global) See Below

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

SEHK:2277 Future Estimates Data
Date (Data in HKD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
SEHK:2277 Past Financials Data
Date (Data in HKD Millions) EPS *
2018-12-31 0.01
2018-09-30 0.07
2018-06-30 0.13
2018-03-31 0.14
2017-12-31 0.16
2016-12-31 0.17
2016-09-30 0.03
2016-06-30 0.04
2016-03-31 0.04

*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.
  • Unable to establish if Huarong Investment Stock will efficiently use shareholders’ funds in the future without estimates of Return on Equity.
X
Future performance checks
We assess Huarong Investment Stock'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.
Huarong Investment Stock has a total score of 3/6, 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 Huarong Investment Stock 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 Huarong Investment Stock'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.
  • Huarong Investment Stock has delivered over 20% year on year earnings growth in the past 5 years.
  • Huarong Investment Stock's 1-year earnings growth is negative, it can't be compared to the 5-year average.
  • Huarong Investment Stock's 1-year earnings growth is negative, it can't be compared to the HK Construction industry average.
Earnings and Revenue History
Huarong Investment Stock'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 Huarong Investment Stock Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

SEHK:2277 Past Revenue, Cash Flow and Net Income Data
Date (Data in HKD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-12-31 1,496.10 9.25 94.14
2018-09-30 1,444.82 121.21 86.92
2018-06-30 1,393.54 233.17 56.54
2018-03-31 1,151.61 251.38 58.57
2017-12-31 909.68 269.60 83.75
2016-12-31 866.56 207.76 87.42
2016-09-30 747.21 34.30 30.74
2016-06-30 769.44 38.92 31.52
2016-03-31 791.66 43.54 32.30
2015-12-31 797.96 53.22 32.34
2015-09-30 804.25 62.91 32.37
2015-06-30 790.67 62.77 31.06
2015-03-31 808.08 65.77 29.87
2014-06-30 669.21 62.13 19.08
2014-03-31 581.43 56.82 17.96
2013-03-31 452.27 44.42 14.58

*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.
  • Huarong Investment Stock has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Huarong Investment Stock used its assets less efficiently than the HK Construction industry average last year based on Return on Assets.
  • Huarong Investment Stock's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Huarong Investment Stock'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.
Huarong Investment Stock has a total score of 1/6, 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 Huarong Investment Stock'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 Huarong Investment Stock's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Huarong Investment Stock is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Huarong Investment Stock's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Huarong Investment Stock'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 not covered by short term assets, assets are 0.8x 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 Huarong Investment Stock Company Filings, last reported 6 months ago.

SEHK:2277 Past Debt and Equity Data
Date (Data in HKD Millions) Total Equity Total Debt Cash & Short Term Investments
2018-12-31 2,215.78 7,729.92 3,683.43
2018-09-30 2,215.78 7,729.92 3,683.43
2018-06-30 2,209.66 10,879.94 4,614.75
2018-03-31 2,209.66 10,879.94 4,614.75
2017-12-31 2,362.97 11,076.56 6,195.34
2016-12-31 562.04 2,752.57 2,044.53
2016-09-30 430.43 2,676.84 2,833.61
2016-06-30 430.43 2,676.84 2,833.61
2016-03-31 226.12 0.07 146.76
2015-12-31 226.12 0.07 146.76
2015-09-30 212.73 0.00 85.65
2015-06-30 212.73 0.00 85.65
2015-03-31 182.59 0.00 120.28
2014-06-30 114.81 22.34 75.76
2014-03-31 112.74 18.29 10.36
2013-03-31 55.92 10.21 7.71
  • Huarong Investment Stock's level of debt (349.2%) compared to net worth is high (greater than 40%).
  • The level of debt compared to net worth has increased over the past 5 years (31.6% vs 349.2% today).
  • Debt is well covered by operating cash flow (39.7%, greater than 20% of total debt).
  • Interest payments on debt are not well covered by earnings (EBIT is 1.5x annual interest expense, ideally 3x coverage).
X
Financial health checks
We assess Huarong Investment Stock'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. Huarong Investment Stock has a total score of 3/6, 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 Huarong Investment Stock'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
0%
Current annual income from Huarong Investment Stock dividends.
If you bought HK$2,000 of Huarong Investment Stock shares you are expected to receive HK$0 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?
  • Unable to evaluate Huarong Investment Stock's dividend yield against the bottom 25% of dividend payers as the company has not reported any payouts.
  • Unable to evaluate Huarong Investment Stock's dividend against the top 25% market benchmark as the company has not reported any payouts.
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:2277 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 0 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:2277 Future Dividends Estimate Data
Date (Data in HK$) Dividend per Share (annual) Avg. No. Analysts

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

  • Unable to perform a dividend volatility check as Huarong Investment Stock has not reported any payouts.
  • Unable to verify if Huarong Investment Stock's dividend has been increasing as the company has not reported any payouts.
Current Payout to shareholders
What portion of Huarong Investment Stock's earnings are paid to the shareholders as a dividend.
  • Unable to calculate sustainability of dividends as Huarong Investment Stock has not reported any payouts.
Future Payout to shareholders
  • Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.
X
Income/ dividend checks
We assess Huarong Investment Stock'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 Huarong Investment Stock afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Huarong Investment Stock has a total score of 0/6, 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 Huarong Investment Stock'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
Xiaowu Xu
COMPENSATION HK$2,583,400
AGE 49
TENURE AS CEO 0 years
CEO Bio

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 Chun Sing Engineering Holdings Limited since September 19, 2016. He serves as Chief Supervisor of Huarong Investment Stock Corporation Limited. He was Chief Executive Officer & Executive Director of Huarong Investment Stock Corp. Ltd until March 13, 2018. Mr. Xu served as a Vice President of China Development Bank Financial Leasing Co., Ltd. since November 1999 until August 2016. Mr. Xu joined China Development Bank Financial Leasing in November 1999. Mr. Xu served as the Assistant to the head of the finance department and the Director of the settlement center in Shenzhen Southern Pharmaceutical Factory (now China Resources Sanjiu Medical & Pharmaceutical Co., Ltd.) from July 1992 to November 1999. He also served as a Supervisor of Sanjiu Medical & Pharmaceutical Co., Ltd. from 1999 to 2002. Mr. Xu graduated from Wuhan University in Wuhan, Hubei Province, the PRC, majoring in auditing with a bachelor’s degree in economics in July 1992. He then graduated from Xiamen University in Xiamen, Fujian Province, the PRC, majoring in world economy with a master’s degree in economics in November 2008. Mr. Xu attended the EMBA course in Cheung Kong Graduate School of Business in Beijing, the PRC, from 2007 to 2009.

CEO Compensation
  • Xiaowu's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.
  • Xiaowu's remuneration is higher than average for companies of similar size in Hong Kong.
Management Team

Meng Yu

TITLE
Chairman of the Board
COMPENSATION
HK$2M
AGE
41

Xiaowu Xu

TITLE
CEO, Chief Supervisor & Director
COMPENSATION
HK$3M
AGE
49

Wai Ming Kwan

TITLE
Executive Director
COMPENSATION
HK$1M
AGE
61

Chin Wan Leung

TITLE
Co-Head of Finance Department & Company Secretary
TENURE
2.3 yrs

Changchun Cheng

TITLE
Vice Chief Executive Officer
AGE
53

Qinghua Chen

TITLE
Deputy Chief Executive Officer
AGE
40
Board of Directors Tenure

Average tenure and age of the Huarong Investment Stock board of directors in years:

3.1
Average Tenure
51
Average Age
  • The tenure for the Huarong Investment Stock board of directors is about average.
Board of Directors

Meng Yu

TITLE
Chairman of the Board
COMPENSATION
HK$2M
AGE
41
TENURE
0.7 yrs

Xiaowu Xu

TITLE
CEO, Chief Supervisor & Director
COMPENSATION
HK$3M
AGE
49

Wai Ming Kwan

TITLE
Executive Director
COMPENSATION
HK$1M
AGE
61
TENURE
5 yrs

Chi Wai Tse

TITLE
Independent Non-Executive Director
COMPENSATION
HK$240K
AGE
51
TENURE
3.3 yrs

Michael Chan

TITLE
Independent Non-Executive Director
COMPENSATION
HK$240K
AGE
67
TENURE
3.1 yrs

Lee George Lam

TITLE
Independent Non-Executive Director
COMPENSATION
HK$240K
AGE
60
TENURE
1.8 yrs

Yingxuan Zhao

TITLE
Non-Executive Director
AGE
39
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$) Value (HK$)
X
Management checks
We assess Huarong Investment Stock'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. Huarong Investment Stock 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

Do Institutions Own Shares In Huarong Investment Stock Corporation Limited (HKG:2277)?

Insider Ownership Of Huarong Investment Stock While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. … Shareholders would probably be interested to learn that insiders own shares in Huarong Investment Stock Corporation Limited. … In their own names, insiders own HK$9.5m worth of stock in the HK$717m company.

Simply Wall St -

Those Who Purchased Huarong Investment Stock (HKG:2277) Shares Three Years Ago Have A 67% Loss To Show For It

But the last three years have been particularly tough on longer term Huarong Investment Stock Corporation Limited (HKG:2277) shareholders. … So they might be feeling emotional about the 67% share price collapse, in that time. … One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Simply Wall St -

Is Huarong Investment Stock Corporation Limited (HKG:2277) Investing Your Capital Efficiently?

To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business. … What is Return On Capital Employed (ROCE)? … ROCE measures the 'return' (pre-tax profit) a company generates from capital employed in its business.

Simply Wall St -

Where Huarong Investment Stock Corporation Limited's (HKG:2277) Earnings Growth Stands Against Its Industry

Improvement in profitability and outperformance against the industry can be important characteristics in a stock for some investors. … Below, I will assess Huarong Investment Stock Corporation Limited's (HKG:2277) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers. … Did 2277 beat its long-term earnings growth trend and its industry.

Simply Wall St -

Will Huarong Investment Stock Corporation Limited (HKG:2277) Continue To Underperform Its Industry?

and looking to gauge the potential return on investment in Huarong Investment Stock Corporation Limited (HKG:2277). … With an ROE of 11.41%, Huarong Investment Stock Corporation Limited (HKG:2277) returned in-line to its own industry which delivered 11.59% over the past year. … But what is more interesting is whether 2277 can sustain or improve on this level of return

Simply Wall St -

Company Info

Description

Huarong Investment Stock Corporation Limited, an investment holding company, engages in 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.

Details
Name: Huarong Investment Stock Corporation Limited
2277
Exchange: SEHK
Founded: 1993
HK$726,400,000
1,816,000,000
Website: http://www.hriv.com.hk
Address: Huarong Investment Stock Corporation Limited
Two Pacific Place,
Room 3201,
Hong Kong,
Hong Kong
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
SEHK 2277 Ordinary Shares The Stock Exchange of Hong Kong Ltd. HK HKD 29. Dec 2014
Number of employees
Current staff
Staff numbers
197
Huarong Investment Stock employees.
Industry
Construction and Engineering
Capital Goods
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/07/19 13:06
End of day share price update: 2019/07/19 00:00
Last estimates confirmation: 2018/03/13
Last earnings filing: 2019/04/29
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.