SEHK:52

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Executive Summary

Fairwood Holdings Limited, an investment holding company, engages in the operation of fast food restaurants.


Snowflake Analysis

Reasonable growth potential with adequate balance sheet.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 52 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

6.3%

52

6.1%

HK Hospitality

5.8%

HK Market


1 Year Return

-38.8%

52

1.9%

HK Hospitality

-4.0%

HK Market

Return vs Industry: 52 underperformed the Hong Kong Hospitality industry which returned 1.9% over the past year.

Return vs Market: 52 underperformed the Hong Kong Market which returned -4% over the past year.


Shareholder returns

52IndustryMarket
7 Day6.3%6.1%5.8%
30 Day-8.5%7.8%4.0%
90 Day-12.5%2.0%-2.6%
1 Year-36.1%-38.8%4.1%1.9%-0.6%-4.0%
3 Year-41.2%-48.8%-6.1%-13.6%1.3%-9.2%
5 Year-0.6%-20.0%9.6%-6.6%-9.2%-23.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

44.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 52 (HK$17) is trading below our estimate of fair value (HK$30.5)

Significantly Below Fair Value: 52 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 52 is poor value based on its PE Ratio (16.1x) compared to the Hospitality industry average (15.4x).

PE vs Market: 52 is poor value based on its PE Ratio (16.1x) compared to the Hong Kong market (9.5x).


Price to Earnings Growth Ratio

PEG Ratio: 52 is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: 52 is overvalued based on its PB Ratio (2.9x) compared to the HK Hospitality industry average (0.8x).


Next Steps

Future Growth

How is Fairwood Holdings forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

20.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 52's forecast earnings growth (20.9% per year) is above the savings rate (1.6%).

Earnings vs Market: 52's earnings (20.9% per year) are forecast to grow faster than the Hong Kong market (17.1% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 52's revenue (2.1% per year) is forecast to grow slower than the Hong Kong market (10.6% per year).

High Growth Revenue: 52's revenue (2.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 52's Return on Equity is forecast to be high in 3 years time (25.3%)


Next Steps

Past Performance

How has Fairwood Holdings performed over the past 5 years?

4.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 52 has high quality earnings.

Growing Profit Margin: 52's current net profit margins (4.5%) are lower than last year (6.9%).


Past Earnings Growth Analysis

Earnings Trend: 52's earnings have grown by 4% per year over the past 5 years.

Accelerating Growth: 52's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 52 had negative earnings growth (-31.6%) over the past year, making it difficult to compare to the Hospitality industry average (-12.4%).


Return on Equity

High ROE: 52's Return on Equity (18.3%) is considered low.


Next Steps

Financial Health

How is Fairwood Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 52's short term assets (HK$773.8M) do not cover its short term liabilities (HK$979.5M).

Long Term Liabilities: 52's short term assets (HK$773.8M) do not cover its long term liabilities (HK$997.5M).


Debt to Equity History and Analysis

Debt Level: 52 is debt free.

Reducing Debt: 52 has no debt compared to 5 years ago when its debt to equity ratio was 2.3%.

Debt Coverage: 52 has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 52 has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

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

6.94%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 52's dividend (6.94%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.43%).

High Dividend: 52's dividend (6.94%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.03%).


Stability and Growth of Payments

Stable Dividend: 52's dividend payments have been volatile in the past 10 years.

Growing Dividend: 52's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (98.3%), 52's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 52's dividends in 3 years are forecast to be covered by earnings (70.2% payout ratio).


Next Steps

Management

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

2.4yrs

Average management tenure


CEO

Francis Lo (36yo)

0.17

Tenure

HK$1,334,000

Compensation

Mr. Fai Shing Lo, also known as Francis, serves as Chief Executive Officer at Fairwood Holdings Limited since April 1, 2020. He has been Executive Director of Fairwood Holdings Limited since January 1, 201 ...


CEO Compensation Analysis

Compensation vs Market: Francis's total compensation ($USD172.13K) is below average for companies of similar size in the Hong Kong market ($USD279.62K).

Compensation vs Earnings: Insufficient data to compare Francis's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Hoi Lo
Executive Chairman20.42yrsHK$11.26m0.084% HK$1.9m
Fai Shing Lo
CEO & Executive Director0.17yrHK$1.33mno data
Peggy Lee
Chief Marketing Officer & Executive Director2.42yrsHK$2.85m0.31% HK$6.8m
Chee Shing Chan
Consultant & Non Executive Director22.42yrsHK$6.45m0.62% HK$13.6m
Yee Mak
Company Secretary & Executive Director10.42yrsHK$3.53m0.91% HK$20.1m

2.4yrs

Average Tenure

52yo

Average Age

Experienced Management: 52's management team is considered experienced (2.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Hoi Lo
Executive Chairman20.42yrsHK$11.26m0.084% HK$1.9m
Fai Shing Lo
CEO & Executive Director0.17yrHK$1.33mno data
Peggy Lee
Chief Marketing Officer & Executive Director2.42yrsHK$2.85m0.31% HK$6.8m
Chee Shing Chan
Consultant & Non Executive Director22.42yrsHK$6.45m0.62% HK$13.6m
Yee Mak
Company Secretary & Executive Director10.42yrsHK$3.53m0.91% HK$20.1m
Kwok Kuen Lau
Independent Non-Executive Director19.75yrsHK$170.00kno data
Chi Keung Ng
Independent Non-Executive Director24.58yrsHK$180.00kno data
Kai Chan
Independent Non-Executive Director29.42yrsHK$190.00kno data
Tong Tsoi
Independent Non-Executive Director11.58yrsHK$170.00kno data
Kam To Wan
Independent Non-Executive Director10.75yrsHK$240.00kno data

15.7yrs

Average Tenure

65.5yo

Average Age

Experienced Board: 52's board of directors are seasoned and experienced ( 15.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 52 insiders have only sold shares 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

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


Key Information


Number of Employees


Location

  • Fairwood Holdings Limited
  • TRP Commercial Centre
  • 2nd Floor
  • North Point
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FRWD.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
52SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDJan 1992
FWOADB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992

Biography

Fairwood Holdings Limited, an investment holding company, engages in the operation of fast food restaurants. The company operates in two segments, Hong Kong Restaurants and Mainland China Restaurants. As of March 31, 2019, it operated 148 stores in Hong Kong, which included 138 fast food stores and 10 specialty restaurants; and 11 stores in Mainland China. The company is also involved in the property investment, and trademark and restaurants license holding activities. Fairwood Holdings Limited was founded in 1972 and is headquartered in North Point, Hong Kong. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/06 12:59
End of Day Share Price2020/06/05 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.