SEHK:114

Stock Analysis Report

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Executive Summary

Herald Holdings Limited, an investment holding company, manufactures, sells, and distributes toys, computer products, housewares, clocks, watches, and electronic and gift products. More Details


Snowflake Analysis

Flawless balance sheet and slightly overvalued.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 114 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.4%

114

-2.0%

HK Leisure

1.2%

HK Market


1 Year Return

-11.1%

114

-30.9%

HK Leisure

2.7%

HK Market

Return vs Industry: 114 exceeded the Hong Kong Leisure industry which returned -30.9% over the past year.

Return vs Market: 114 underperformed the Hong Kong Market which returned 2.7% over the past year.


Shareholder returns

114IndustryMarket
7 Day-3.4%-2.0%1.2%
30 Day-11.1%-3.1%4.0%
90 Day-11.1%-2.9%3.2%
1 Year-4.2%-11.1%-28.7%-30.9%7.0%2.7%
3 Year-41.3%-50.9%-51.8%-55.4%-4.4%-14.8%
5 Year-17.5%-40.4%-63.2%-65.1%19.5%-0.7%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Herald 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: 114 (HK$0.56) is trading below our estimate of fair value (HK$7.7)

Significantly Below Fair Value: 114 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 114 is poor value based on its PE Ratio (38.5x) compared to the HK Leisure industry average (7.5x).

PE vs Market: 114 is poor value based on its PE Ratio (38.5x) compared to the Hong Kong market (11.1x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 114's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 114's PB Ratio (0.5x) is in line with the HK Leisure industry average.


Next Steps

Future Growth

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

21.3%

Forecasted Consumer Durables 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 Herald 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 Herald Holdings performed over the past 5 years?

-39.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 114 has a large one-off gain of HK$20.3M impacting its March 31 2020 financial results.

Growing Profit Margin: 114 became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: 114's earnings have declined by 39.5% per year over the past 5 years.

Accelerating Growth: 114 has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: 114 has become profitable in the last year, making it difficult to compare its past year earnings growth to the Leisure industry (-27.7%).


Return on Equity

High ROE: 114's Return on Equity (1.1%) is considered low.


Next Steps

Financial Health

How is Herald Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 114's short term assets (HK$531.0M) exceed its short term liabilities (HK$173.5M).

Long Term Liabilities: 114's short term assets (HK$531.0M) exceed its long term liabilities (HK$22.9M).


Debt to Equity History and Analysis

Debt Level: 114's debt to equity ratio (0.5%) is considered satisfactory.

Reducing Debt: 114's debt to equity ratio has reduced from 1% to 0.5% over the past 5 years.

Debt Coverage: 114's debt is well covered by operating cash flow (1355%).

Interest Coverage: 114 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

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

10.71%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 114's dividend (10.71%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.24%).

High Dividend: 114's dividend (10.71%) is in the top 25% of dividend payers in the Hong Kong market (6.77%)


Stability and Growth of Payments

Stable Dividend: 114's dividend payments have been volatile in the past 10 years.

Growing Dividend: 114's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (343.5%), 114's dividend payments are not 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?

12.8yrs

Average board tenure


CEO

Kam-Hung Shum (56 yo)

5.25yrs

Tenure

HK$3,159,000

Compensation

Mr. Kam-Hung Shum, ACIS, CPA has been the Managing Director of Herald Holdings Limited since July 1, 2015 and served as its Secretary since July 04, 2008 until June 30, 2015. Mr. Shum served at Herald Hold ...


CEO Compensation Analysis

Compensation vs Market: Kam-Hung's total compensation ($USD407.61K) is above average for companies of similar size in the Hong Kong market ($USD232.63K).

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


Board Members

NamePositionTenureCompensationOwnership
Robert Dorfman
Executive Chairman6.5yrsHK$5.58m8.51%
HK$ 28.8m
Kam-Hung Shum
MD & Executive Director 5.25yrsHK$3.16mno data
Tsang-Kay Cheung
Executive Director28.75yrsHK$5.31m26.73%
HK$ 90.5m
Tze-Kin Ng
Independent Non-Executive Director10.67yrsHK$300.00kno data
Tai Chong Lie-A-Cheong
Independent Non-Executive Director15.33yrsHK$300.00kno data
Man-Chun Yeh
Independent Non-Executive Director15yrsHK$300.00kno data

12.8yrs

Average Tenure

65yo

Average Age

Experienced Board: 114's board of directors are seasoned and experienced ( 12.8 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.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

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


Key Information

  • Name: Herald Holdings Limited
  • Ticker: 114
  • Exchange: SEHK
  • Founded: 1992
  • Industry: Leisure Products
  • Sector: Consumer Durables
  • Market Cap: HK$338.515m
  • Shares outstanding: 604.49m
  • Website: https://www.heraldgroup.com.hk

Number of Employees


Location

  • Herald Holdings Limited
  • Tower Two
  • 31st floor
  • Hong Kong
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HHOL.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDOct 1992
114SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDOct 1992
HH3BST (Boerse-Stuttgart)YesOrdinary SharesDEEUROct 1992

Biography

Herald Holdings Limited, an investment holding company, manufactures, sells, and distributes toys, computer products, housewares, clocks, watches, and electronic and gift products. The company offers a ran ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/24 12:38
End of Day Share Price2020/10/23 00:00
Earnings2020/03/31
Annual Earnings2020/03/31


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.