SEHK:8506

Stock Analysis Report

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Executive Summary

China Futex Holdings Limited, an investment holding company, engages in the research and development, manufacture, and sale of circular knitting machines in the People's Republic of China, India, South Korea, Bangladesh, Vietnam, and internationally. More Details


Snowflake Analysis

Excellent balance sheet and slightly overvalued.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 8506 is more volatile than 90% of Hong Kong stocks over the past 3 months, typically moving +/- 18% a week.

Volatility Over Time: 8506's weekly volatility (18%) has been stable over the past year, but is still higher than 75% of Hong Kong stocks.


Market Performance


7 Day Return

-5.9%

8506

4.4%

HK Machinery

0.7%

HK Market


1 Year Return

96.5%

8506

42.1%

HK Machinery

7.8%

HK Market

Return vs Industry: 8506 exceeded the Hong Kong Machinery industry which returned 42.1% over the past year.

Return vs Market: 8506 exceeded the Hong Kong Market which returned 7.8% over the past year.


Shareholder returns

8506IndustryMarket
7 Day-5.9%4.4%0.7%
30 Day-38.3%8.3%5.9%
90 Day-42.3%8.8%4.7%
1 Year96.5%96.5%45.6%42.1%12.2%7.8%
3 Yearn/a70.9%57.9%-1.5%-11.7%
5 Yearn/a141.1%120.3%30.2%8.2%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is China Futex Holdings undervalued compared to its fair value and its price relative to the market?

23.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 8506 (HK$0.22) is trading below our estimate of fair value (HK$0.29)

Significantly Below Fair Value: 8506 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 8506 is poor value based on its PE Ratio (27.2x) compared to the HK Machinery industry average (13.1x).

PE vs Market: 8506 is poor value based on its PE Ratio (27.2x) compared to the Hong Kong market (11.2x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 8506's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 8506 is overvalued based on its PB Ratio (1.3x) compared to the HK Machinery industry average (0.9x).


Next Steps

Future Growth

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

6.0%

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 China Futex 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 China Futex Holdings performed over the past 5 years?

3.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 8506 has high quality earnings.

Growing Profit Margin: 8506's current net profit margins (9.2%) are lower than last year (15.6%).


Past Earnings Growth Analysis

Earnings Trend: 8506's earnings have grown by 3.5% per year over the past 5 years.

Accelerating Growth: 8506's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 8506 had negative earnings growth (-65.3%) over the past year, making it difficult to compare to the Machinery industry average (-1.6%).


Return on Equity

High ROE: 8506's Return on Equity (4.9%) is considered low.


Next Steps

Financial Health

How is China Futex Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 8506's short term assets (CN¥178.3M) exceed its short term liabilities (CN¥58.4M).

Long Term Liabilities: 8506 has no long term liabilities.


Debt to Equity History and Analysis

Debt Level: 8506's debt to equity ratio (35.3%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if 8506's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: 8506's debt is well covered by operating cash flow (35.6%).

Interest Coverage: 8506's interest payments on its debt are well covered by EBIT (4.4x coverage).


Balance Sheet


Next Steps

Dividend

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


Dividend Yield vs Market

Notable Dividend: Unable to evaluate 8506's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate 8506's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 8506's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 8506's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 8506's dividend in 3 years as they are not forecast to pay a notable one for the Hong Kong market.


Next Steps

Management

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

2.9yrs

Average board tenure


CEO

Yuan Yuan (44 yo)

no data

Tenure

CN¥301,000

Compensation

Ms. Yuan Yuan has been Executive Director at China Futex Holdings Ltd. since December 11, 2017 and has been its Chairlady, Compliance Officer and Chief Executive Officer since December 11, 2017 and serve...


CEO Compensation Analysis

Compensation vs Market: Yuan's total compensation ($USD45.67K) is below average for companies of similar size in the Hong Kong market ($USD230.39K).

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


Board Members

NamePositionTenureCompensationOwnership
Yuan Yuan
Chairladyno dataCN¥301.00kno data
Yihui Chen
Executive Director4.33yrsCN¥305.00k8.12%
CN¥ 17.5m
Xudong Hu
Independent Non-Executive Director2.92yrsCN¥60.00kno data
Shing Kei Shum
Independent Non-Executive Director2.92yrsCN¥88.00kno data
Zhirong Mu
Independent Non-Executive Director2.92yrsCN¥60.00kno data

2.9yrs

Average Tenure

48yo

Average Age

Experienced Board: 8506's board of directors are not considered experienced ( 2.9 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

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


Key Information

  • Name: China Futex Holdings Limited
  • Ticker: 8506
  • Exchange: SEHK
  • Founded: 2016
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: HK$216.000m
  • Shares outstanding: 1.00b
  • Website: https://www.kx-machine.com

Number of Employees


Location

  • China Futex Holdings Limited
  • Xiawei Village
  • Fugong Town
  • Longhai
  • Fujian Province
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
8506SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary Shares of HK$0.01HKHKDJan 2018

Biography

China Futex Holdings Limited, an investment holding company, engages in the research and development, manufacture, and sale of circular knitting machines in the People's Republic of China, India, South Kor...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/11/25 12:51
End of Day Share Price2020/11/25 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


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.