SEHK:8356

Stock Analysis Report

Executive Summary

CNC Holdings Limited, an investment holding company, primarily provides waterworks engineering services.

Rewards

Trading at 49.4% below its fair value

Risk Analysis

Currently unprofitable and not forecast to become profitable over the next 3 years

Highly volatile share price over past 3 months

Does not have a meaningful market cap (HK$118M)



Snowflake Analysis

Slightly overvalued with imperfect balance sheet.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 8356's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-3.4%

8356

-0.8%

HK Construction

-1.4%

HK Market


1 Year Return

-54.8%

8356

-18.0%

HK Construction

3.5%

HK Market

Return vs Industry: 8356 underperformed the Hong Kong Construction industry which returned -16.2% over the past year.

Return vs Market: 8356 underperformed the Hong Kong Market which returned 6.4% over the past year.


Shareholder returns

8356IndustryMarket
7 Day-3.4%-0.8%-1.4%
30 Day-6.7%-0.9%1.8%
90 Day-26.3%0.01%6.0%
1 Year-54.8%-54.8%-14.0%-18.0%7.3%3.5%
3 Year-82.4%-82.4%-28.4%-36.2%23.3%10.8%
5 Year-90.2%-90.2%-20.8%-32.5%19.2%-0.7%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is CNC 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: 8356 (HK$0.03) is trading below our estimate of fair value (HK$0.06)

Significantly Below Fair Value: 8356 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 8356 is unprofitable, so we can't compare its PE Ratio to the Construction industry average.

PE vs Market: 8356 is unprofitable, so we can't compare its PE Ratio to the Hong Kong market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 8356's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 8356 has negative assets, so we can't compare its PB Ratio to the HK Construction industry average.


Next Steps

Future Growth

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

10.8%

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 CNC 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 CNC Holdings performed over the past 5 years?

33.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 8356 is currently unprofitable.

Growing Profit Margin: 8356 is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: 8356 is unprofitable, but has reduced losses over the past 5 years at a rate of 33.7% per year.

Accelerating Growth: Unable to compare 8356's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 8356 is unprofitable, making it difficult to compare its past year earnings growth to the Construction industry (-12.3%).


Return on Equity

High ROE: 8356's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is CNC Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 8356 has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: 8356 has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: 8356 has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: 8356's has negative shareholder equity, so we do not need to check if its debt has reduced over time.


Balance Sheet

Inventory Level: 8356 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 8356 has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable 8356 has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: 8356 is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 55% per year.


Next Steps

Dividend

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


Dividend Yield vs Market

company0%marketbottom25%2.2%markettop25%6.1%industryaverage4.3%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate 8356's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 8356's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 8356's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 8356's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: 8356 is not paying a notable dividend for the Hong Kong market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 8356's dividend in 3 years as they are not forecast to pay a notable one for the Hong Kong market.


Next Steps

Management

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

2.1yrs

Average management tenure


CEO

Yong Sheng Li (48yo)

2.1yrs

Tenure

0

Mr. Yong Sheng Li has been Vice Chairman, Chief Executive Officer and Executive Director of CNC Holdings Limited since December 8, 2017 and its Compliance Officer since January 5, 2018. Mr. Li a Reporter s ...


CEO Compensation Analysis

Compensation vs Market: Yong Sheng's total compensation ($USD0.00) is below average for companies of similar size in the Hong Kong market ($USD228.16K).

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


Management Age and Tenure

2.1yrs

Average Tenure

51yo

Average Age

Experienced Management: 8356's management team is considered experienced (2.1 years average tenure).


Board Age and Tenure

2.1yrs

Average Tenure

52.5yo

Average Age

Experienced Board: 8356's board of directors are not considered experienced ( 2.1 years average tenure), which suggests a new board.


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

  • Kwok Cheung Kan (54yo)

    Executive Director

    • Tenure: 23.9yrs
    • Compensation: HK$4.78m
  • Mabel Kan (51yo)

    Administration Officer

    • Yuet Tai Li (36yo)

      CFO & Company Secretary

      • Tenure: 5.9yrs
    • Yong Sheng Li (48yo)

      Executive Vice Chairman

      • Tenure: 2.1yrs
    • Yan Jiang (51yo)

      Chairman of the Board

      • Tenure: 2.4yrs
    • Da Yong Liu

      Executive Director

      • Tenure: 2.1yrs

    Board Members

    • Aaron Wan (69yo)

      Independent Non-Executive Director

      • Tenure: 4.9yrs
      • Compensation: HK$144.00k
    • Andrew Fan (40yo)

      Independent Non-Executive Director

      • Tenure: 2yrs
      • Compensation: HK$144.00k
    • Kwok Cheung Kan (54yo)

      Executive Director

      • Tenure: 23.9yrs
      • Compensation: HK$4.78m
    • Yong Sheng Li (48yo)

      Executive Vice Chairman

      • Tenure: 2.1yrs
    • Kenneth Wong (51yo)

      Independent Non-Executive Director

      • Tenure: 6.1yrs
      • Compensation: HK$144.00k
    • Yan Jiang (51yo)

      Chairman of the Board

      • Tenure: 2.4yrs
    • Guo Ming Wu (55yo)

      Independent Non-Executive Director

      • Tenure: 2yrs
      • Compensation: HK$144.00k
    • Cheuk Hung Law (61yo)

      Non-Executive Director

      • Tenure: 2yrs
      • Compensation: HK$1.00m
    • Li Tang

      Non-Executive Director

      • Tenure: 2.1yrs
    • Da Yong Liu

      Executive Director

      • Tenure: 2.1yrs

    Company Information

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


    Key Information

    • Name: CNC Holdings Limited
    • Ticker: 8356
    • Exchange: SEHK
    • Founded: 1989
    • Industry: Construction and Engineering
    • Sector: Capital Goods
    • Market Cap: HK$113.550m
    • Shares outstanding: 4.06b
    • Website: https://www.cnctv.hk

    Number of Employees


    Location

    • CNC Holdings Limited
    • Everbright Centre
    • Suites 2708-2710
    • Wanchai
    • Hong Kong

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    8356SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDAug 2010

    Biography

    CNC Holdings Limited, an investment holding company, primarily provides waterworks engineering services. It operates through Provision of Civil Engineering Services and Television Broadcasting Business segments. The company provides road works and drainage services, and site formation works for the public sector in Hong Kong, as well as laying of water pipes. It also broadcasts television programs on television channels operated by television broadcasting companies in the Asia-Pacific region. In addition, it holds and leases motor vehicles; and provides management services. Further, the company engages in advertising business. The company was formerly known as Tsun Yip Holdings Limited and changed its name to CNC Holdings Limited in February 2012. CNC Holdings Limited was founded in 1989 and is headquartered in Wanchai, Hong Kong. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/22 12:58
    End of Day Share Price2020/01/22 00:00
    Earnings2019/09/30
    Annual Earnings2019/03/31


    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.