Xiabuxiabu Catering Management (China) Holdings (SEHK:520) - Share price, News & Analysis

520 fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	4/6
Past Performance	0/6
Financial Health	4/6
Dividends	1/6

520 Stock Overview

Xiabuxiabu Catering Management (China) Holdings Co., Ltd., an investment holding company, operates Chinese hotpot restaurants in the People’s Republic of China.

Rewards

Trading at 76.4% below our estimate of its fair value

Earnings are forecast to grow 82.75% per year

Risk Analysis

No risks detected for 520 from our risk checks.

Xiabuxiabu Catering Management (China) Holdings Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Xiabuxiabu Catering Management (China) Holdings
Historical stock prices
Current Share Price	HK$4.05
52 Week High	HK$8.78
52 Week Low	HK$2.84
Beta	1.07
1 Month Change	27.36%
3 Month Change	5.20%
1 Year Change	-51.21%
3 Year Change	-64.35%
5 Year Change	-44.29%
Change since IPO	-10.79%

Recent News & Updates

May 04

These 4 Measures Indicate That Xiabuxiabu Catering Management (China) Holdings (HKG:520) Is Using Debt Extensively

Warren Buffett famously said, 'Volatility is far from synonymous with risk.' So it seems the smart money knows that...

Shareholder Returns

	520	HK Hospitality	HK Market
7D	-4.9%	2.8%	2.1%
1Y	-51.2%	-39.2%	-23.3%

Return vs Industry: 520 underperformed the Hong Kong Hospitality industry which returned -39.2% over the past year.

Return vs Market: 520 underperformed the Hong Kong Market which returned -23.3% over the past year.

Price Volatility

Is 520's price volatile compared to industry and market?
520 volatility
520 Average Weekly Movement	9.4%
Hospitality Industry Average Movement	7.8%
Market Average Movement	7.0%
10% most volatile stocks in HK Market	13.8%
10% least volatile stocks in HK Market	3.3%

Stable Share Price: 520 is not significantly more volatile than the rest of Hong Kong stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: 520's weekly volatility (9%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1998	28,536	Kuang-Chi Ho	https://www.xiabu.com

Xiabuxiabu Catering Management (China) Holdings Co., Ltd., an investment holding company, operates Chinese hotpot restaurants in the People’s Republic of China. As of December 31, 2021, the company owned and operated 841 restaurants under the Xiabuxiabu brand name in 132 cities in approximately 21 provinces and three centrally administered municipalities; and 183 restaurants under the Coucou brand name in 42 cities in approximately 19 provinces in Beijing, Tianjin, Shanghai, and Hong Kong. It also offers catering services; and sells condiment products and other goods.

Xiabuxiabu Catering Management (China) Holdings Fundamentals Summary

How do Xiabuxiabu Catering Management (China) Holdings's earnings and revenue compare to its market cap?
520 fundamental statistics
Market Cap	CN¥3.74b
Earnings (TTM)	-CN¥293.21m
Revenue (TTM)	CN¥6.16b

0.6x

P/S Ratio

-12.7x

P/E Ratio

Is 520 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
520 income statement (TTM)
Revenue	CN¥6.16b
Cost of Revenue	CN¥4.70b
Gross Profit	CN¥1.46b
Other Expenses	CN¥1.75b
Earnings	-CN¥293.21m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	-0.27
Gross Margin	23.67%
Net Profit Margin	-4.76%
Debt/Equity Ratio	3.8%

How did 520 perform over the long term?

See historical performance and comparison

Dividends

1.6%

Current Dividend Yield

-21%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 520 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 520?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 520. This is calculated by dividing 520's market cap by their current preferred multiple.
What is 520's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	CN¥3.74b

520 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.7x
Enterprise Value/EBITDA	9.3x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does 520's PS Ratio compare to its peers?

520 PS Ratio vs Peers

The above table shows the PS ratio for 520 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	1.2x

Forward PS

Price-To-Sales vs Peers: 520 is good value based on its Price-To-Sales Ratio (0.6x) compared to the peer average (1.2x).

Price to Earnings Ratio vs Industry

How does 520's PE Ratio compare vs other companies in the Hong Kong Hospitality Industry?

Price-To-Sales vs Industry: 520 is good value based on its Price-To-Sales Ratio (0.6x) compared to the Hong Kong Hospitality industry average (1.7x)

Price to Sales Ratio vs Fair Ratio

What is 520's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

520 PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	0.6x
Fair PS Ratio	1.4x

Price-To-Sales vs Fair Ratio: 520 is good value based on its Price-To-Sales Ratio (0.6x) compared to the estimated Fair Price-To-Sales Ratio (1.4x).

Share Price vs Fair Value

What is the Fair Price of 520 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 520 (HK$4.05) is trading below our estimate of fair value (HK$17.15)

Significantly Below Fair Value: 520 is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 520's PEG Ratio to determine if it is good value.

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Future Growth

How is Xiabuxiabu Catering Management (China) Holdings forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

82.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 520 is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.5%).

Earnings vs Market: 520 is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: 520 is expected to become profitable in the next 3 years.

Revenue vs Market: 520's revenue (16.9% per year) is forecast to grow faster than the Hong Kong market (10.2% per year).

High Growth Revenue: 520's revenue (16.9% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 520's Return on Equity is forecast to be low in 3 years time (15.3%).

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Past Performance

How has Xiabuxiabu Catering Management (China) Holdings performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-40.8%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 520 is currently unprofitable.

Growing Profit Margin: 520 is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: 520 is unprofitable, and losses have increased over the past 5 years at a rate of 40.8% per year.

Accelerating Growth: Unable to compare 520's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 520 is unprofitable, making it difficult to compare its past year earnings growth to the Hospitality industry (18.5%).

Return on Equity

High ROE: 520 has a negative Return on Equity (-14.08%), as it is currently unprofitable.

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Financial Health

How is Xiabuxiabu Catering Management (China) Holdings's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 520's short term assets (CN¥2.0B) exceed its short term liabilities (CN¥1.8B).

Long Term Liabilities: 520's short term assets (CN¥2.0B) exceed its long term liabilities (CN¥1.2B).

Debt to Equity History and Analysis

Debt Level: 520 has more cash than its total debt.

Reducing Debt: Insufficient data to determine if 520's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: 520's debt is well covered by operating cash flow (1383.2%).

Interest Coverage: 520's interest payments on its debt are not well covered by EBIT (0.3x coverage).

Balance Sheet

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Dividend

What is Xiabuxiabu Catering Management (China) Holdings's current dividend yield, its reliability and sustainability?

Dividend Score

1/6

Dividend Score 1/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

1.62%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 520's dividend (1.62%) isn’t notable compared to the bottom 25% of dividend payers in the Hong Kong market (2.74%).

High Dividend: 520's dividend (1.62%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.89%).

Stability and Growth of Payments

Stable Dividend: 520 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 520 has only been paying a dividend for 7 years, and since then payments have fallen.

Earnings Payout to Shareholders

Earnings Coverage: 520 is paying a dividend but the company is unprofitable.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (10%), 520's dividend payments are thoroughly covered by cash flows.

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Management

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

1.1yrs

Average management tenure

CEO

Kuang-Chi Ho (57 yo)

1.08yrs

Tenure

CN¥9,962,000

Compensation

Mr. Kuang-Chi Ho serves as the Chairman of Xiabuxiabu Catering Management (China) Holdings Co., Ltd. and has been its Executive Director since May 14, 2008 and serves as its Chief Executive Officer since M...

Leadership Team

Experienced Management: 520's management team is not considered experienced ( 1.1 years average tenure), which suggests a new team.

Board Members

Experienced Board: 520's board of directors are considered experienced (7.6 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.

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/06/25 00:00
End of Day Share Price	2022/06/24 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31