Genertec Universal Medical Group (SEHK:2666) - Share price, News & Analysis

Q: What is the Fair Price of 2666 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

2666 (HK$4.85) is trading below our estimate of [[fair value]] (HK$8.15)

2666 fundamental analysis
Snowflake Score
Valuation	6/6
Future Growth	1/6
Past Performance	2/6
Financial Health	3/6
Dividends	2/6

2666 Stock Overview

Genertec Universal Medical Group Company Limited, together with its subsidiaries, offers financing and advisory services in the People’s Republic of China.

Rewards

Trading at 40.5% below our estimate of its fair value

Earnings are forecast to grow 16.05% per year

Earnings have grown 13% per year over the past 5 years

Risk Analysis

Debt is not well covered by operating cash flow

Dividend of 7.12% is not well covered by earnings

Genertec Universal Medical Group Competitors

CSSC (Hong Kong) Shipping

SEHK:3877

HK$8.7b

China Development Bank Financial Leasing

SEHK:1606

HK$14.0b

International Alliance Financial Leasing

SEHK:1563

HK$5.2b

Haitong Unitrust International Financial Leasing

SEHK:1905

HK$6.9b

Price History & Performance

Summary of all time highs, changes and price drops for Genertec Universal Medical Group
Historical stock prices
Current Share Price	HK$4.85
52 Week High	HK$7.94
52 Week Low	HK$4.20
Beta	0.62
1 Month Change	-3.39%
3 Month Change	-6.01%
1 Year Change	-36.10%
3 Year Change	-22.40%
5 Year Change	-20.62%
Change since IPO	-3.00%

Recent News & Updates

Jun 08

Genertec Universal Medical Group's (HKG:2666) Shareholders Will Receive A Bigger Dividend Than Last Year

Genertec Universal Medical Group Company Limited ( HKG:2666 ) has announced that it will be increasing its dividend on...

Shareholder Returns

	2666	HK Diversified Financial	HK Market
7D	5.9%	0.7%	1.7%
1Y	-36.1%	-10.5%	-21.2%

Return vs Industry: 2666 underperformed the Hong Kong Diversified Financial industry which returned -10.5% over the past year.

Return vs Market: 2666 underperformed the Hong Kong Market which returned -21.2% over the past year.

Price Volatility

Is 2666's price volatile compared to industry and market?
2666 volatility
2666 Average Weekly Movement	3.9%
Diversified Financial Industry Average Movement	6.2%
Market Average Movement	6.9%
10% most volatile stocks in HK Market	13.8%
10% least volatile stocks in HK Market	3.4%

Stable Share Price: 2666 is less volatile than 75% of Hong Kong stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: 2666's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1984	15,242	Wang Wenbing	https://www.umcare.cn

Genertec Universal Medical Group Company Limited, together with its subsidiaries, offers financing and advisory services in the People’s Republic of China. It operates in two segments, Finance and Advisory and Hospital Group. The Finance and Advisory segment provides direct finance leasing; sale and leaseback; factoring; operating leases; and advisory services.

Genertec Universal Medical Group Fundamentals Summary

How do Genertec Universal Medical Group's earnings and revenue compare to its market cap?
2666 fundamental statistics
Market Cap	CN¥7.82b
Earnings (TTM)	CN¥1.84b
Revenue (TTM)	CN¥9.57b

4.3x

P/E Ratio

0.8x

P/S Ratio

Is 2666 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
2666 income statement (TTM)
Revenue	CN¥9.57b
Cost of Revenue	CN¥5.71b
Gross Profit	CN¥3.85b
Other Expenses	CN¥2.02b
Earnings	CN¥1.84b

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.97
Gross Margin	40.26%
Net Profit Margin	19.18%
Debt/Equity Ratio	243.0%

How did 2666 perform over the long term?

See historical performance and comparison

Dividends

7.1%

Current Dividend Yield

30%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 2666 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

6/6

Valuation Score 6/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings 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 2666?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 2666. This is calculated by dividing 2666's market cap by their current preferred multiple.
What is 2666's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	CN¥7.82b

2666 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	n/a
Enterprise Value/EBITDA	n/a
PEG Ratio	0.3x

Price to Earnings Ratio vs Peers

How does 2666's PE Ratio compare to its peers?

2666 PE Ratio vs Peers

The above table shows the PE ratio for 2666 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	17.7x
3877 CSSC (Hong Kong) Shipping	6.5x	15.6%	HK$8.7b
1606 China Development Bank Financial Leasing	3.2x	n/a	HK$14.0b
1563 International Alliance Financial Leasing	56.8x	n/a	HK$5.2b
1905 Haitong Unitrust International Financial Leasing	4.5x	n/a	HK$6.9b
2666 Genertec Universal Medical Group	4.3x	16.1%	HK$9.2b

Forward PE

Price-To-Earnings vs Peers: 2666 is good value based on its Price-To-Earnings Ratio (4.3x) compared to the peer average (17.7x).

Price to Earnings Ratio vs Industry

How does 2666's PE Ratio compare vs other companies in the Asian Diversified Financial Industry?

Price-To-Earnings vs Industry: 2666 is good value based on its Price-To-Earnings Ratio (4.3x) compared to the Hong Kong Diversified Financial industry average (8.4x)

Price to Earnings Ratio vs Fair Ratio

What is 2666's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

2666 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	4.3x
Fair PE Ratio	6.2x

Price-To-Earnings vs Fair Ratio: 2666 is good value based on its Price-To-Earnings Ratio (4.3x) compared to the estimated Fair Price-To-Earnings Ratio (6.2x).

Share Price vs Fair Value

What is the Fair Price of 2666 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 2666 (HK$4.85) is trading below our estimate of fair value (HK$8.15)

Significantly Below Fair Value: 2666 is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: 2666 is good value based on its PEG Ratio (0.3x)

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Future Growth

How is Genertec Universal Medical Group forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

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

16.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 2666's forecast earnings growth (16.1% per year) is above the savings rate (1.5%).

Earnings vs Market: 2666's earnings (16.1% per year) are forecast to grow slower than the Hong Kong market (17.1% per year).

High Growth Earnings: 2666's earnings are forecast to grow, but not significantly.

Revenue vs Market: Insufficient data to determine if 2666's revenue is forecast to grow faster than the Hong Kong market.

High Growth Revenue: Insufficient data to determine if 2666's revenue is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 2666's Return on Equity is forecast to be low in 3 years time (16.7%).

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Past Performance

How has Genertec Universal Medical Group performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

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

13.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 2666 has high quality earnings.

Growing Profit Margin: 2666's current net profit margins (19.2%) are lower than last year (20%).

Past Earnings Growth Analysis

Earnings Trend: 2666's earnings have grown by 13% per year over the past 5 years.

Accelerating Growth: 2666's earnings growth over the past year (11.4%) is below its 5-year average (13% per year).

Earnings vs Industry: 2666 earnings growth over the past year (11.4%) underperformed the Diversified Financial industry 20.2%.

Return on Equity

High ROE: 2666's Return on Equity (11.5%) is considered low.

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Financial Health

How is Genertec Universal Medical Group's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

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

Financial Position Analysis

Short Term Liabilities: 2666's short term assets (CN¥64.5B) exceed its short term liabilities (CN¥18.7B).

Long Term Liabilities: 2666's short term assets (CN¥64.5B) exceed its long term liabilities (CN¥33.5B).

Debt to Equity History and Analysis

Debt Level: 2666's net debt to equity ratio (229.7%) is considered high.

Reducing Debt: 2666's debt to equity ratio has reduced from 283.1% to 243% over the past 5 years.

Debt Coverage: 2666's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: Insufficient data to determine if 2666's interest payments on its debt are well covered by EBIT.

Balance Sheet

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Dividend

What is Genertec Universal Medical Group current dividend yield, its reliability and sustainability?

Dividend Score

2/6

Dividend Score 2/6

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

7.12%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 2666's dividend (7.12%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.7%).

High Dividend: 2666's dividend (7.12%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.78%).

Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, 2666 has been paying a dividend for less than 10 years.

Growing Dividend: 2666's dividend payments have increased, but the company has only paid a dividend for 6 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (29.7%), 2666's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: 2666 is paying a dividend but the company has no free cash flows.

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Management

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

5.3yrs

Average management tenure

CEO

Wang Wenbing (48 yo)

5.33yrs

Tenure

CN¥1,629,000

Compensation

Mr. Wang Wenbing is General Manager of China Universal Leasing Co., Ltd since October 14, 2021. He has been Deputy General Manager of Genertec Universal Medical Group Company Limited (formerly known as Uni...

CEO Compensation Analysis

Compensation vs Market: Wang's total compensation ($USD243.44K) is below average for companies of similar size in the Hong Kong market ($USD548.84K).

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

Leadership Team

Experienced Management: 2666's management team is seasoned and experienced (5.3 years average tenure).

Board Members

Experienced Board: 2666's board of directors are not considered experienced ( 2.5 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.

Recent Insider Transactions

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/06/28 00:00
End of Day Share Price	2022/06/28 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31