SEHK:6038

Stock Analysis Report

Executive Summary

G & M Holdings Limited, an investment holding company, provides design and build, and repair and maintenance services in relation to podium facade and curtain wall works in Hong Kong.


Snowflake Analysis

Undervalued with excellent balance sheet.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 6038's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-7.6%

6038

2.2%

HK Construction

2.9%

HK Market


1 Year Return

-43.9%

6038

-25.9%

HK Construction

-3.8%

HK Market

Return vs Industry: 6038 underperformed the Hong Kong Construction industry which returned -25.9% over the past year.

Return vs Market: 6038 underperformed the Hong Kong Market which returned -3.8% over the past year.


Shareholder returns

6038IndustryMarket
7 Day-7.6%2.2%2.9%
30 Day-17.8%-4.7%-4.1%
90 Day-14.7%-2.3%2.9%
1 Year-39.9%-43.9%-22.4%-25.9%-0.2%-3.8%
3 Yearn/a-34.1%-41.3%15.3%3.7%
5 Yearn/a-22.3%-33.8%16.8%-2.7%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is G & M 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: 6038 (HK$0.16) is trading below our estimate of fair value (HK$0.87)

Significantly Below Fair Value: 6038 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 6038 is good value based on its PE Ratio (4.4x) compared to the Construction industry average (9.2x).

PE vs Market: 6038 is good value based on its PE Ratio (4.4x) compared to the Hong Kong market (10.1x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 6038's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 6038 is good value based on its PB Ratio (0.7x) compared to the HK Construction industry average (1x).


Next Steps

Future Growth

How is G & M Holdings forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

10.9%

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 G & M Holdings 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 G & M Holdings performed over the past 5 years?

-0.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 6038 has a high level of non-cash earnings.

Growing Profit Margin: 6038's current net profit margins (10.8%) are lower than last year (14.5%).


Past Earnings Growth Analysis

Earnings Trend: 6038's earnings have declined by -0.9% per year over the past 5 years.

Accelerating Growth: 6038's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 6038 had negative earnings growth (-29.7%) over the past year, making it difficult to compare to the Construction industry average (-5.4%).


Return on Equity

High ROE: 6038's Return on Equity (16.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is G & M Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 6038's short term assets (HK$292.3M) exceed its short term liabilities (HK$78.3M).

Long Term Liabilities: 6038's short term assets (HK$292.3M) exceed its long term liabilities (HK$2.1M).


Debt to Equity History and Analysis

Debt Level: 6038's debt to equity ratio (1.4%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if 6038's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: 6038's debt is well covered by operating cash flow (292.6%).

Interest Coverage: 6038's interest payments on its debt are well covered by EBIT (142.5x coverage).


Balance Sheet

Inventory Level: 6038 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 6038's debt is covered by short term assets (assets are 97.4x debt).


Next Steps

Dividend

What is G & M Holdings's current dividend yield, its reliability and sustainability?

11.46%

Current Dividend Yield


Dividend Yield vs Market

company11.5%marketbottom25%2.2%markettop25%6.3%industryaverage4.4%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: 6038's dividend (11.46%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.25%).

High Dividend: 6038's dividend (11.46%) is in the top 25% of dividend payers in the Hong Kong market (6.33%)


Stability and Growth of Payments

Stable Dividend: 6038 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 6038 has only been paying a dividend for 2 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (50.7%), 6038's dividend payments are 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?

3.1yrs

Average management tenure


CEO

Chi Hung Lee (53yo)

HK$3,859,000

Compensation

Mr. Lee Chi Hung is a Co-Owner of Luxury Booming Limited. Mr. Lee serves as the Chairman of the Board and Chief Executive Officer of G & M Holdings Limited and has been its Executive Director since Novembe ...


CEO Compensation Analysis

Compensation vs Market: Chi Hung's total compensation ($USD496.77K) is above average for companies of similar size in the Hong Kong market ($USD225.53K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Chi Hung Lee
Chairman of the Board & CEO0yrsHK$3.86mno data
Wai Yin Chan
Executive Director3.1yrsHK$1.64mno data
Shuk Man Huen
Financial Controller & Joint Company Secretary3.1yrsno datano data
Yau Choi
Chief Operating Officer2.5yrsno datano data
Baldwin Lee
Joint Company Secretary3.1yrsno datano data

3.1yrs

Average Tenure

52yo

Average Age

Experienced Management: 6038's management team is considered experienced (3.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Chi Hung Lee
Chairman of the Board & CEO0yrsHK$3.86mno data
Wai Yin Chan
Executive Director3.1yrsHK$1.64mno data
Sue Cheun Wong
Independent Non-Executive Director2.8yrsHK$240.00kno data
Kwok Leung Tai
Independent Non-Executive Director2.8yrsHK$240.00kno data
Ping Kwan Leung
Non-Executive Director3.1yrsHK$784.00kno data
Cheuk Kui Kwan
Independent Non-Executive Director2.8yrsHK$240.00kno data

2.8yrs

Average Tenure

55.5yo

Average Age

Experienced Board: 6038's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


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

G & M Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: G & M Holdings Limited
  • Ticker: 6038
  • Exchange: SEHK
  • Founded: 1993
  • Industry: Construction and Engineering
  • Sector: Capital Goods
  • Market Cap: HK$161.000m
  • Shares outstanding: 1.00b
  • Website: https://www.gm-eng.com.hk

Number of Employees


Location

  • G & M Holdings Limited
  • Manhattan Centre
  • Units 1709-14
  • Kwai Chung
  • New Territories
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
6038SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDJun 2017

Biography

G & M Holdings Limited, an investment holding company, provides design and build, and repair and maintenance services in relation to podium facade and curtain wall works in Hong Kong. It undertakes design and build project works, such as developing facade or curtain wall system design, structural calculation and shop drawings, sourcing and procurement of materials, arrangement for material fabrication and processing, installation works, and post-completion maintenance services. The company also offers repair and maintenance, and inspection and consultancy services. G & M Holdings Limited was founded in 1993 and is headquartered in Kwai Chung, Hong Kong. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 13:21
End of Day Share Price2020/02/18 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.