Chevalier International (SEHK:25): Loss Deepens to -$553M HKD, Profitability Pressures Reinforce Bearish Narratives

Chevalier International Holdings (SEHK:25) just released its H1 2026 financial results, posting revenue of $5.2 billion HKD and a basic EPS of -1.84 HKD for the period. Looking back, revenue has shifted from $4.3 billion HKD in H2 2024 to $4.0 billion HKD in H1 2025, before rebounding this half. EPS figures have alternated between losses and small gains. For investors, the underlying story this half is about continued margin pressures and earnings volatility as the company works to steady its profitability trajectory.

See our full analysis for Chevalier International Holdings.

Next, we will see how these latest numbers stack up when weighed against the prevailing narratives from the market and Simply Wall St community and where some storylines may get tested.

Curious how numbers become stories that shape markets? Explore Community Narratives

Losses Deepen Despite Revenue Uptick

• Net losses for H1 2026 came in at $553.4 million HKD, widening compared to H2 2024’s $429.0 million HKD loss. Revenue rebounded to $5.2 billion HKD this half.
• With overall net losses accelerating at a 59.2% annual rate over five years, the prevailing market view notes this persistent decline is a central challenge. Profitability remains elusive, and there is still no sign of a turnaround in margin trends.
  • Trailing-twelve-month net income sits at a negative $322.8 million HKD, which confirms the ongoing severity of profitability pressures.
  • Despite fluctuations in revenue, margin improvement has not materialized, lending weight to the argument that structural headwinds are not yet resolved.

Valuation Signal: Cheap on Sales, Pricey on DCF

• Chevalier’s Price-to-Sales Ratio is 0.1x, well below the peer group’s 1.3x and the sector’s 0.8x average. The share price of $4.15 HKD trades above the DCF fair value of $1.39 HKD.
• While many investors might see the low sales multiple as a bargain opportunity, the prevailing opinion cautions that value is only clear if the company can restore its profitability. This is particularly relevant since the discounted cash flow valuation suggests the market is still pricing in optimism not supported by current earnings.
  • The disconnect between cheap sales multiples and a market price above fair value reflects skepticism about near-term recovery.
  • This tension means Chevalier’s valuation story is nuanced and will depend heavily on future profit trends rather than sales alone.

Dividend Yield Draws Scrutiny

• The current yield stands at 3.86%, but analysis shows it is not covered by earnings or free cash flow. This undermines its sustainability in the absence of improving profits.
• Prevailing analysis suggests the dividend’s allure is dampened by persistent operating losses, since the payout now appears vulnerable without a material earnings rebound.
  • With no uptrend in profitability across recent halves, the risk that the dividend could be cut has increased.
  • Investors are being urged to look past the headline yield and closely examine underlying cash flows and loss trends.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Chevalier International Holdings's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Chevalier’s continued operating losses, profit volatility, and dividend coverage concerns highlight ongoing risks to shareholders seeking reliable returns.

If dependable payouts and financial strength are your priority, check out these 1927 dividend stocks with yields > 3% to focus on companies delivering dividends that are better supported by earnings.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com