TK Group (Holdings) (SEHK:2283) - Share price, News & Analysis

Q: What is the Fair Price of 2283 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

2283 (HK$1.8) is trading below our estimate of [[fair value]] (HK$12.78)

2283 fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	5/6
Past Performance	3/6
Financial Health	6/6
Dividends	3/6

2283 Stock Overview

TK Group (Holdings) Limited, an investment holding company, engages in the manufacture, sale, subcontracting, fabrication, and modification of molds and plastic components.

Rewards

Trading at 85.9% below our estimate of its fair value

Earnings are forecast to grow 22.4% per year

Risk Analysis

Unstable dividend track record

TK Group (Holdings) Competitors

Lung Kee (Bermuda) Holdings

SEHK:255

HK$1.7b

Chen Hsong Holdings

SEHK:57

HK$1.3b

IPE Group

SEHK:929

HK$757.6m

Pujiang International Group

SEHK:2060

HK$2.4b

Price History & Performance

Summary of all time highs, changes and price drops for TK Group (Holdings)
Historical stock prices
Current Share Price	HK$1.80
52 Week High	HK$3.43
52 Week Low	HK$1.65
Beta	0.98
1 Month Change	-5.26%
3 Month Change	-18.18%
1 Year Change	-41.94%
3 Year Change	-34.78%
5 Year Change	-48.72%
Change since IPO	45.16%

Recent News & Updates

Jul 27

TK Group (Holdings) (HKG:2283) Might Be Having Difficulty Using Its Capital Effectively

Did you know there are some financial metrics that can provide clues of a potential multi-bagger? Typically, we'll want...

Shareholder Returns

	2283	HK Machinery	HK Market
7D	0%	-0.5%	-0.6%
1Y	-41.9%	-36.5%	-23.8%

Return vs Industry: 2283 underperformed the Hong Kong Machinery industry which returned -36.5% over the past year.

Return vs Market: 2283 underperformed the Hong Kong Market which returned -23.8% over the past year.

Price Volatility

Is 2283's price volatile compared to industry and market?
2283 volatility
2283 Average Weekly Movement	6.2%
Machinery Industry Average Movement	6.6%
Market Average Movement	6.5%
10% most volatile stocks in HK Market	12.8%
10% least volatile stocks in HK Market	3.1%

Stable Share Price: 2283 is not significantly more volatile than the rest of Hong Kong stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: 2283's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1983	3,641	Michael Yung	https://www.tkmold.com

TK Group (Holdings) Limited, an investment holding company, engages in the manufacture, sale, subcontracting, fabrication, and modification of molds and plastic components. The company operates in two segments, Mold Fabrication and Plastic Components Manufacturing. It provides precision, high performance, special decoration, and medical molding products.

TK Group (Holdings) Fundamentals Summary

How do TK Group (Holdings)'s earnings and revenue compare to its market cap?
2283 fundamental statistics
Market Cap	HK$1.50b
Earnings (TTM)	HK$282.38m
Revenue (TTM)	HK$2.40b

5.3x

P/E Ratio

0.6x

P/S Ratio

Is 2283 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
2283 income statement (TTM)
Revenue	HK$2.40b
Cost of Revenue	HK$1.84b
Gross Profit	HK$569.17m
Other Expenses	HK$286.78m
Earnings	HK$282.38m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.34
Gross Margin	23.67%
Net Profit Margin	11.74%
Debt/Equity Ratio	20.9%

How did 2283 perform over the long term?

See historical performance and comparison

Dividends

7.8%

Current Dividend Yield

41%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 2283 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 2283?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 2283. This is calculated by dividing 2283's market cap by their current preferred multiple.
What is 2283's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	HK$1.50b

2283 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.4x
Enterprise Value/EBITDA	2.1x
PEG Ratio	0.2x

Price to Earnings Ratio vs Peers

How does 2283's PE Ratio compare to its peers?

2283 PE Ratio vs Peers

The above table shows the PE ratio for 2283 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	8.4x
255 Lung Kee (Bermuda) Holdings	7.8x	n/a	HK$1.7b
57 Chen Hsong Holdings	6.3x	n/a	HK$1.3b
929 IPE Group	9.8x	n/a	HK$757.6m
2060 Pujiang International Group	9.6x	n/a	HK$2.4b
2283 TK Group (Holdings)	5.3x	22.4%	HK$1.5b

Price-To-Earnings vs Peers: 2283 is good value based on its Price-To-Earnings Ratio (5.3x) compared to the peer average (8.4x).

Price to Earnings Ratio vs Industry

How does 2283's PE Ratio compare vs other companies in the HK Machinery Industry?

Price-To-Earnings vs Industry: 2283 is good value based on its Price-To-Earnings Ratio (5.3x) compared to the Hong Kong Machinery industry average (10.8x)

Price to Earnings Ratio vs Fair Ratio

What is 2283's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

2283 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	5.3x
Fair PE Ratio	6.5x

Price-To-Earnings vs Fair Ratio: 2283 is good value based on its Price-To-Earnings Ratio (5.3x) compared to the estimated Fair Price-To-Earnings Ratio (6.5x).

Share Price vs Fair Value

What is the Fair Price of 2283 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 2283 (HK$1.8) is trading below our estimate of fair value (HK$12.78)

Significantly Below Fair Value: 2283 is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but there are not enough analysts covering the stock to determine statistical confidence in agreement.

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Future Growth

How is TK Group (Holdings) forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

22.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 2283's forecast earnings growth (22.4% per year) is above the savings rate (1.6%).

Earnings vs Market: 2283's earnings (22.4% per year) are forecast to grow faster than the Hong Kong market (16.6% per year).

High Growth Earnings: 2283's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 2283's revenue (16.6% per year) is forecast to grow faster than the Hong Kong market (10% per year).

High Growth Revenue: 2283's revenue (16.6% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 2283's Return on Equity is forecast to be high in 3 years time (23.2%)

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Past Performance

How has TK Group (Holdings) performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-0.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 2283 has high quality earnings.

Growing Profit Margin: 2283's current net profit margins (11.7%) are higher than last year (10.3%).

Past Earnings Growth Analysis

Earnings Trend: 2283's earnings have declined by 0.5% per year over the past 5 years.

Accelerating Growth: 2283's earnings growth over the past year (34.7%) exceeds its 5-year average (-0.5% per year).

Earnings vs Industry: 2283 earnings growth over the past year (34.7%) underperformed the Machinery industry 35.1%.

Return on Equity

High ROE: 2283's Return on Equity (17.4%) is considered low.

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Financial Health

How is TK Group (Holdings)'s financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 2283's short term assets (HK$2.1B) exceed its short term liabilities (HK$963.9M).

Long Term Liabilities: 2283's short term assets (HK$2.1B) exceed its long term liabilities (HK$265.4M).

Debt to Equity History and Analysis

Debt Level: 2283 has more cash than its total debt.

Reducing Debt: 2283's debt to equity ratio has reduced from 29% to 20.9% over the past 5 years.

Debt Coverage: 2283's debt is well covered by operating cash flow (105.4%).

Interest Coverage: 2283 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is TK Group (Holdings) current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

7.78%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 2283's dividend (7.78%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.86%).

High Dividend: 2283's dividend (7.78%) is low compared to the top 25% of dividend payers in the Hong Kong market (8.39%).

Stability and Growth of Payments

Stable Dividend: 2283 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 2283's dividend payments have increased, but the company has only paid a dividend for 8 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (41.2%), 2283's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (46.9%), 2283's dividend payments are well covered by cash flows.

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Management

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

7.3yrs

Average management tenure

CEO

Michael Yung (61 yo)

no data

Tenure

HK$5,151,000

Compensation

Mr. Kin Cheung Yung, also known as Michael, serves as the Chief Executive Officer at TK Group Holdings Limited. Mr. Yung has approximately 25 years of experience in plastic mold fabrication and plastic inj...

CEO Compensation Analysis

Compensation vs Market: Michael's total compensation ($USD656.38K) is above average for companies of similar size in the Hong Kong market ($USD305.74K).

Compensation vs Earnings: Michael's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: 2283's management team is seasoned and experienced (7.3 years average tenure).

Board Members

Experienced Board: 2283's board of directors are considered experienced (8.8 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.

Data	Last Updated (UTC time)
Company Analysis	2022/08/11 00:00
End of Day Share Price	2022/08/11 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31