SEHK:3339

Stock Analysis Report

Executive Summary

Lonking Holdings Limited, an investment holding company, manufactures and distributes wheel loaders, road rollers, excavators, forklifts, and other construction machinery in Mainland China.

Snowflake

Fundamentals

Flawless balance sheet, undervalued and pays a dividend.


Similar Companies

Share Price & News

How has Lonking Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 3339 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-4.6%

3339

-5.2%

HK Machinery

-4.2%

HK Market


1 Year Return

4.6%

3339

21.1%

HK Machinery

-2.6%

HK Market

Return vs Industry: 3339 underperformed the Hong Kong Machinery industry which returned 21.1% over the past year.

Return vs Market: 3339 exceeded the Hong Kong Market which returned -2.6% over the past year.


Shareholder returns

3339IndustryMarket
7 Day-4.6%-5.2%-4.2%
30 Day2.7%3.2%-1.4%
90 Day26.1%10.7%3.5%
1 Year14.2%4.6%24.6%21.1%0.9%-2.6%
3 Year81.7%55.5%62.4%52.0%19.6%7.6%
5 Year96.5%59.9%40.2%28.4%18.6%-1.0%

Price Volatility Vs. Market

How volatile is Lonking Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Lonking Holdings 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: 3339 (HK$2.27) is trading below our estimate of fair value (HK$7.18)

Significantly Below Fair Value: 3339 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 3339 is good value based on its PE Ratio (6.5x) compared to the Machinery industry average (10.2x).

PE vs Market: 3339 is good value based on its PE Ratio (6.5x) compared to the Hong Kong market (10.1x).


Price to Earnings Growth Ratio

PEG Ratio: 3339's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: 3339 is good value based on its PB Ratio (1x) compared to the HK Machinery industry average (1x).


Next Steps

Future Growth

How is Lonking Holdings forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

-3.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 3339's earnings are forecast to decline over the next 3 years (-3.8% per year).

Earnings vs Market: 3339's earnings are forecast to decline over the next 3 years (-3.8% per year).

High Growth Earnings: 3339's earnings are forecast to decline over the next 3 years.

Revenue vs Market: 3339's revenue is expected to decline over the next 3 years (-0.7% per year).

High Growth Revenue: 3339's revenue is forecast to decline over the next 3 years (-0.7% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 3339's Return on Equity is forecast to be low in 3 years time (13.7%).


Next Steps

Past Performance

How has Lonking Holdings performed over the past 5 years?

36.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 3339 has high quality earnings.

Growing Profit Margin: 3339's current net profit margins (11.1%) are lower than last year (11.3%).


Past Earnings Growth Analysis

Earnings Trend: 3339's earnings have grown significantly by 36% per year over the past 5 years.

Accelerating Growth: 3339's earnings growth over the past year (6.1%) is below its 5-year average (36% per year).

Earnings vs Industry: 3339 earnings growth over the past year (6.1%) exceeded the Machinery industry 5.7%.


Return on Equity

High ROE: 3339's Return on Equity (15.9%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Lonking Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 3339's short term assets (CN¥10.8B) exceeds its short term liabilities (CN¥4.9B)

Long Term Liabilities: 3339's short term assets (10.8B) exceeds its long term liabilities (1.3B)


Debt to Equity History and Analysis

Debt Level: 3339's debt to equity ratio (15.5%) is considered satisfactory

Reducing Debt: 3339's debt to equity ratio has reduced from 64% to 15.5% over the past 5 years.

Debt Coverage: 3339's debt is well covered by operating cash flow (111.1%).

Interest Coverage: 3339 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: 3339 has a high level of physical assets or inventory.

Debt Coverage by Assets: 3339's debt is covered by short term assets (assets are 8.4x debt).


Next Steps

Dividend

What is Lonking Holdings's current dividend yield, its reliability and sustainability?

8.39%

Current Dividend Yield


Dividend Yield vs Market

company8.4%marketbottom25%2.3%markettop25%6.4%industryaverage3.0%forecastin3Years8.1%

Current dividend yield vs market & industry

Notable Dividend: 3339's dividend (8.39%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.27%).

High Dividend: 3339's dividend (8.39%) is in the top 25% of dividend payers in the Hong Kong market (6.38%)


Stability and Growth of Payments

Stable Dividend: 3339's dividend payments have been volatile in the past 10 years.

Growing Dividend: 3339's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (56.6%), 3339's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 3339's dividends in 3 years are forecast to be covered by earnings (51.8% payout ratio).


Next Steps

Management

What is the CEO of Lonking Holdings's salary, the management and board of directors tenure and is there insider trading?

7.5yrs

Average board tenure


CEO

San Li (68yo)

3.9yrs

Tenure

CN¥9,925,000

Compensation

Mr. San Yim Li is the Founder of Lonking Holdings Ltd. (Also called as China Infrastructure Machinery Holdings Ltd.) and serves as its Executive Chairman and has also been Chief Executive Officer since Dec ...


CEO Compensation Analysis

Compensation vs Market: San's total compensation ($USD1.42M) is above average for companies of similar size in the Hong Kong market ($USD488.74K).

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


Board Age and Tenure

7.5yrs

Average Tenure

63yo

Average Age

Experienced Board: 3339's board of directors are considered experienced (7.5 years average tenure).


Insider Trading

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.


Management Team

  • San Li (68yo)

    Founder

    • Tenure: 3.9yrs
    • Compensation: CN¥9.93m
  • Jianru Luo (72yo)

    VP & Executive Director

    • Tenure: 14.8yrs
    • Compensation: CN¥900.00k
  • Chao Chen (44yo)

    Executive VP & Executive Director

    • Tenure: 14.8yrs
    • Compensation: CN¥1.25m
  • Shun Chu (41yo)

    Company Secretary & Financial Controller

    • Tenure: 10.3yrs
  • Ke Zheng (44yo)

    VP, GM of Excavator Business Segment & Executive Director

    • Tenure: 7.5yrs
    • Compensation: CN¥1.25m
  • Kun Yin (51yo)

    CFO & Executive Director

    • Tenure: 7.5yrs
    • Compensation: CN¥850.00k

Board Members

  • Shizheng Qian (67yo)

    Independent Non Executive Director

    • Tenure: 14.8yrs
    • Compensation: CN¥200.00k
  • San Li (68yo)

    Founder

    • Tenure: 3.9yrs
    • Compensation: CN¥9.93m
  • Jianru Luo (72yo)

    VP & Executive Director

    • Tenure: 14.8yrs
    • Compensation: CN¥900.00k
  • Ngan Ngai (63yo)

    Non Executive Vice Chairman

    • Tenure: 0yrs
    • Compensation: CN¥1.20m
  • Chao Chen (44yo)

    Executive VP & Executive Director

    • Tenure: 14.8yrs
    • Compensation: CN¥1.25m
  • Ke Zheng (44yo)

    VP, GM of Excavator Business Segment & Executive Director

    • Tenure: 7.5yrs
    • Compensation: CN¥1.25m
  • Kun Yin (51yo)

    CFO & Executive Director

    • Tenure: 7.5yrs
    • Compensation: CN¥850.00k
  • Jian Wu (65yo)

    Independent Non-Executive Director

    • Tenure: 6.3yrs
    • Compensation: CN¥100.00k
  • Zhen Chen (44yo)

    Independent Non-Executive Director

    • Tenure: 5.1yrs
    • Compensation: CN¥100.00k

Company Information

Lonking Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lonking Holdings Limited
  • Ticker: 3339
  • Exchange: SEHK
  • Founded: 1993
  • Industry: Construction Machinery and Heavy Trucks
  • Sector: Capital Goods
  • Market Cap: HK$9.716b
  • Shares outstanding: 4.28b
  • Website: https://www.lonking.cn

Number of Employees


Location

  • Lonking Holdings Limited
  • No. 26 Mingyi Road
  • Xinqiao
  • Shanghai
  • 201612
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
3339SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDNov 2005
C9IBDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 2005
LONK.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 2005
3339SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesOrdinary SharesHKHKDNov 2005
3339SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesOrdinary SharesHKHKDNov 2005
LKHL.YOTCPK (Pink Sheets LLC)ADRUSUSDMay 2010

Biography

Lonking Holdings Limited, an investment holding company, manufactures and distributes wheel loaders, road rollers, excavators, forklifts, and other construction machinery in Mainland China. It also provide ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/11/16 12:42
End of Day Share Price2019/11/15 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.