SEHK:53

Stock Analysis Report

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Executive Summary

Guoco Group Limited, together with its subsidiaries, engages in the investment, property investment and development, hospitality and leisure, and financial service businesses.


Snowflake Analysis

Adequate balance sheet with acceptable track record.

Share Price & News

How has Guoco Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 53 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.0%

53

3.9%

HK Industrials

4.0%

HK Market


1 Year Return

-8.7%

53

-29.1%

HK Industrials

-4.9%

HK Market

Return vs Industry: 53 exceeded the Hong Kong Industrials industry which returned -29.8% over the past year.

Return vs Market: 53 underperformed the Hong Kong Market which returned -6.6% over the past year.


Shareholder returns

53IndustryMarket
7 Day-1.0%3.9%4.0%
30 Day4.2%0.09%5.3%
90 Day1.0%2.7%13.3%
1 Year-5.8%-8.7%-25.2%-29.1%-1.4%-4.9%
3 Year38.2%24.5%-27.2%-35.9%7.7%-3.5%
5 Year50.8%23.9%-35.0%-45.5%7.1%-10.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Guoco Group undervalued compared to its fair value and its price relative to the market?

8.36x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 53 (HK$110.9) is trading above our estimate of fair value (HK$54.8)

Significantly Below Fair Value: 53 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 53 is poor value based on its PE Ratio (8.4x) compared to the Industrials industry average (5.6x).

PE vs Market: 53 is good value based on its PE Ratio (8.4x) compared to the Hong Kong market (10.1x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 53's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 53 is overvalued based on its PB Ratio (0.6x) compared to the HK Industrials industry average (0.4x).


Next Steps

Future Growth

How is Guoco Group forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

1.1%

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 Guoco Group 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 Guoco Group performed over the past 5 years?

-4.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 53 has a large one-off gain of $307.8M impacting its December 31 2004 financial results.

Growing Profit Margin: 53's current net profit margins (23.3%) are higher than last year (8.2%).


Past Earnings Growth Analysis

Earnings Trend: 53's earnings have declined by -4.7% per year over the past 5 years.

Accelerating Growth: 53's earnings growth over the past year (238.9%) exceeds its 5-year average (-4.7% per year).

Earnings vs Industry: 53 earnings growth over the past year (238.9%) exceeded the Industrials industry 1.3%.


Return on Equity

High ROE: 53's Return on Equity (6.8%) is considered low.


Next Steps

Financial Health

How is Guoco Group's financial position?


Financial Position Analysis

Short Term Liabilities: 53's short term assets ($6.7B) exceed its short term liabilities ($1.8B).

Long Term Liabilities: 53's short term assets ($6.7B) exceed its long term liabilities ($5.5B).


Debt to Equity History and Analysis

Debt Level: 53's debt to equity ratio (51.2%) is considered high.

Reducing Debt: 53's debt to equity ratio has reduced from 70.6% to 51.2% over the past 5 years.

Debt Coverage: 53's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: 53's interest payments on its debt are well covered by EBIT (3.7x coverage).


Balance Sheet


Next Steps

Dividend

What is Guoco Group current dividend yield, its reliability and sustainability?

3.57%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 53's dividend (3.57%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.39%).

High Dividend: 53's dividend (3.57%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.84%).


Stability and Growth of Payments

Stable Dividend: 53's dividend payments have been volatile in the past 10 years.

Growing Dividend: 53's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (30%), 53's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

5.4yrs

Average board tenure


CEO

Hong Cheong Tang (65yo)

3.83yrs

Tenure

US$3,656,000

Compensation

Mr. Hong Cheong Tang has been the Chief Executive Officer and President at Guoco Group Limited since September 1, 2016. Mr. Tang has been Group Managing Director at GL Limited since September 15, 2016. He  ...


CEO Compensation Analysis

Compensation vs Market: Hong Cheong's total compensation ($USD3.66M) is above average for companies of similar size in the Hong Kong market ($USD488.00K).

Compensation vs Earnings: Hong Cheong's compensation has been consistent with company performance over the past year.


Board Members

NamePositionTenureCompensationOwnership
Leng Hai Kwek
Executive Chairman3.83yrsUS$8.22m1.16% $423.8m
Hong Cheong Tang
President3.83yrsUS$3.66m0.040% $14.5m
David Michael Norman
Independent Non-Executive Director7yrsUS$55.00k0.0012% $447.6k
Leng San Kwek
Non-Executive Director30.5yrsno data0.064% $23.3m
Roderic Noel Sage
Independent Non-Executive Director10.75yrsUS$66.00kno data
Lester Garson Huang
Independent Non-executive Director0.67yrno datano data

5.4yrs

Average Tenure

65yo

Average Age

Experienced Board: 53's board of directors are considered experienced (5.4 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.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Guoco Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Guoco Group Limited
  • Ticker: 53
  • Exchange: SEHK
  • Founded:
  • Industry: Industrial Conglomerates
  • Sector: Capital Goods
  • Market Cap: HK$36.689b
  • Shares outstanding: 329.05m
  • Website: https://www.guoco.com

Number of Employees


Location

  • Guoco Group Limited
  • The Center
  • 50th Floor
  • Hong Kong
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GULR.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
53SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDJan 1992
GULR.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDNov 2008

Biography

Guoco Group Limited, together with its subsidiaries, engages in the investment, property investment and development, hospitality and leisure, and financial service businesses. Its Principal Investment segment offers equity and direct investment activities and treasury operations with trading and strategic investments in global capital markets. The company’s Property Development and Investment segment develops residential and commercial properties and holds properties for rental income in Singapore, China, Malaysia, Vietnam, and Hong Kong. Its Hospitality and Leisure Business segment owns, leases, and manages hotels; and operates gaming and leisure businesses in United Kingdom, Spain, and Belgium. This segment owns and operates 17 hotels under Amba, Guoman, Thistle, and Thistle Express brands. It offers Mecca, a bingo operator in Great Britain with 82 clubs; Grosvenor Casinos, a casino operator with 52 casinos in Great Britain, and 1 casino in Belgium; online and mobile casino business; and Enracha, an operator of 9 bingo clubs in Spain. The company’s Financial Services segment provides commercial and consumer, Islamic, and investment banking services; and life and general insurance, Takaful insurance, fund management and unit trust, stock broking, and corporate advisory services. The company also offers royalty entitlement of Bass Strait’s oil and gas production, marketing, and distribution of health products. In addition, it provides hotel and property management, marketing and maintenance services, support services for interactive gaming, funding, and trustee services; and apiculture services, which includes manufacture and distribution of New Zealand natural healthcare products. The company operates in the People’s Republic of China, the United Kingdom and Continental Europe, Singapore, Australasia, and internationally. Guoco Group Limited is based in Hong Kong, Hong Kong. Guoco Group Limited is a subsidiary of GuoLine Overseas Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/03 12:41
End of Day Share Price2020/07/03 00:00
Earnings2019/12/31
Annual Earnings2019/06/30


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.