SEHK:6881

Stock Analysis Report

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Executive Summary

China Galaxy Securities Co., Ltd. provides various financial services in the People’s Republic of China.


Snowflake Analysis

Fair value with acceptable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 6881 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

7.6%

6881

0.7%

HK Capital Markets

-1.4%

HK Market


1 Year Return

1.3%

6881

5.6%

HK Capital Markets

-9.4%

HK Market

Return vs Industry: 6881 underperformed the Hong Kong Capital Markets industry which returned 5.6% over the past year.

Return vs Market: 6881 exceeded the Hong Kong Market which returned -9.4% over the past year.


Shareholder returns

6881IndustryMarket
7 Day7.6%0.7%-1.4%
30 Day19.1%13.3%2.5%
90 Day25.5%25.2%7.8%
1 Year1.3%1.3%7.8%5.6%-6.5%-9.4%
3 Year-28.2%-32.4%-4.3%-11.9%2.0%-8.2%
5 Year-29.4%-38.7%-8.6%-21.0%12.4%-5.6%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is China Galaxy Securities undervalued compared to its fair value and its price relative to the market?

1.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 6881 (HK$4.67) is trading below our estimate of fair value (HK$4.76)

Significantly Below Fair Value: 6881 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: 6881 is good value based on its PE Ratio (7.9x) compared to the Capital Markets industry average (10.9x).

PE vs Market: 6881 is good value based on its PE Ratio (7.9x) compared to the Hong Kong market (10x).


Price to Earnings Growth Ratio

PEG Ratio: 6881 is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: 6881 is overvalued based on its PB Ratio (0.6x) compared to the HK Capital Markets industry average (0.5x).


Next Steps

Future Growth

How is China Galaxy Securities forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

5.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 6881's forecast earnings growth (5% per year) is above the savings rate (1.6%).

Earnings vs Market: 6881's earnings (5% per year) are forecast to grow slower than the Hong Kong market (17.5% per year).

High Growth Earnings: 6881's earnings are forecast to grow, but not significantly.

Revenue vs Market: 6881's revenue is expected to decline over the next 3 years (-0.08% per year).

High Growth Revenue: 6881's revenue is forecast to decline over the next 3 years (-0.08% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 6881's Return on Equity is forecast to be low in 3 years time (7.5%).


Next Steps

Past Performance

How has China Galaxy Securities performed over the past 5 years?

-16.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 6881 has high quality earnings.

Growing Profit Margin: 6881's current net profit margins (28.3%) are lower than last year (33.1%).


Past Earnings Growth Analysis

Earnings Trend: 6881's earnings have declined by -16.3% per year over the past 5 years.

Accelerating Growth: 6881's earnings growth over the past year (44.6%) exceeds its 5-year average (-16.3% per year).

Earnings vs Industry: 6881 earnings growth over the past year (44.6%) exceeded the Capital Markets industry -8.1%.


Return on Equity

High ROE: 6881's Return on Equity (7.4%) is considered low.


Next Steps

Financial Health

How is China Galaxy Securities's financial position?


Financial Position Analysis

Short Term Liabilities: 6881's short term assets (CN¥300.2B) exceed its short term liabilities (CN¥197.0B).

Long Term Liabilities: 6881's short term assets (CN¥300.2B) exceed its long term liabilities (CN¥96.6B).


Debt to Equity History and Analysis

Debt Level: 6881's debt to equity ratio (245.5%) is considered high.

Reducing Debt: 6881's debt to equity ratio has reduced from 310.6% to 245.5% over the past 5 years.

Debt Coverage: 6881's debt is not well covered by operating cash flow (13.2%).

Interest Coverage: Insufficient data to determine if 6881's interest payments on its debt are well covered by EBIT.


Balance Sheet


Next Steps

Dividend

What is China Galaxy Securities's current dividend yield, its reliability and sustainability?

3.75%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: 6881's dividend (3.75%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.42%).

High Dividend: 6881's dividend (3.75%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.05%).


Stability and Growth of Payments

Stable Dividend: 6881 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 6881's dividend payments have increased, but the company has only paid a dividend for 6 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (29.8%), 6881's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 6881's dividends in 3 years are forecast to be well covered by earnings (30.1% payout ratio).


Next Steps

Management

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

1.5yrs

Average management tenure


CEO

Liang Chen (52yo)

1.08yrs

Tenure

CN¥914,000

Compensation

Mr. Liang Chen has been the Vice Chairman and Executive Director of China Galaxy Securities Company Ltd. since December 20, 2019. He has been the President of China Galaxy Securities Co., Ltd., since June  ...


CEO Compensation Analysis

Compensation vs Market: Liang's total compensation ($USD129.25K) is below average for companies of similar size in the Hong Kong market ($USD773.04K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Gongyan Chen
Executive Chairman of the Board3.75yrsCN¥3.03mno data
Liang Chen
Executive Vice Chairman1.08yrsCN¥914.00kno data
Chengming Wu
Interim CFO & Secretary to the Board1.25yrsCN¥3.09mno data
Shipeng Liang
Chief Compliance Officer1yrCN¥1.16mno data
Jianhui Wu
Chief Business Officer1.5yrsCN¥2.25mno data
Yanwu Yin
Chief Business Officer7.58yrsCN¥2.83mno data
Liming Luo
Chief Business Officer3.08yrsCN¥2.94mno data
Guofang Wu
Chief Business Officer1.67yrsCN¥2.57mno data
Kwok Fai Lee
Joint Company Secretary1.75yrsno datano data

1.5yrs

Average Tenure

50.5yo

Average Age

Experienced Management: 6881's management team is not considered experienced ( 1.5 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Gongyan Chen
Executive Chairman of the Board3.75yrsCN¥3.03mno data
Liang Chen
Executive Vice Chairman1.08yrsCN¥914.00kno data
Jing Chen
Chairman of the Board of Supervisors3.17yrsno datano data
Dingping Liu
Non-Executive Director2.42yrsno datano data
Lihong Xiao
Non Executive Director1.42yrsno datano data
Ruizhong Liu
Independent Non-Executive Director2.83yrsCN¥244.00kno data
Zhenjun Wang
Independent Non-Executive Director2.42yrsCN¥248.00kno data
Tianli Zhang
Non-Executive Director1.42yrsno datano data
Chun Liu
Independent Non-Executive Director1.42yrsCN¥198.00kno data
Zelan Wang
Non Executive Employee Director1.42yrsCN¥2.31mno data

1.9yrs

Average Tenure

57.5yo

Average Age

Experienced Board: 6881's board of directors are not considered experienced ( 1.9 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.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

China Galaxy Securities Co., Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: China Galaxy Securities Co., Ltd.
  • Ticker: 6881
  • Exchange: SEHK
  • Founded: 2007
  • Industry: Investment Banking and Brokerage
  • Sector: Diversified Financials
  • Market Cap: HK$99.900b
  • Shares outstanding: 10.14b
  • Website: https://www.chinastock.com.cn

Number of Employees


Location

  • China Galaxy Securities Co., Ltd.
  • Tower C, Corporate Square
  • 2-6 Floors
  • Beijing
  • Beijing Province
  • 100033
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
6881SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDMay 2013
CGLDB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEURMay 2013
6881SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDMay 2013
6881SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDMay 2013
CGXY.YOTCPK (Pink Sheets LLC)ADRUSUSDAug 2013
601881SHSE (Shanghai Stock Exchange)Domestic SharesCNCNYJan 2017
601881XSSC (Shanghai Stock Exchange - Shanghai - Hong Kong Stock Connect)Domestic SharesCNCNYJan 2017

Biography

China Galaxy Securities Co., Ltd. provides various financial services in the People’s Republic of China. Its Securities Brokerage segment offers securities dealing and broking; margin financing to margin clients; and securities lending services. The Company’s Futures Brokerage segment is involved in futures dealing and broking, futures information consulting, and training activities. Its Proprietary Trading and Other Securities Trading Services segment engages in the trading of equities, bonds, funds, derivatives, and other financial products. The Company’s Investment Banking segment provides corporate financial services, including equity and debt securities underwriting, and financial advisory services to institutional clients. Its Asset Management segment offers portfolio management, investment advisory, and transaction execution services. The Company’s Private Equity and Alternative Investment segment makes equity investments in private companies. Its Overseas Business segment provides securities brokerage, futures brokerage, securities research, investment banking, margin financing, money lending, asset management, and insurance brokerage services in Hong Kong. The company serves various individual and institutional clients comprising multinational corporations, medium and small-sized enterprises, high-net-worth clients, and retail clients. It operates through a network of 36 branch offices and 493 securities branches. The company was founded in 2007 and is headquartered in Beijing, the People’s Republic of China. China Galaxy Securities Co., Ltd. is a subsidiary of China Galaxy Financial Holdings Company Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/02 12:36
End of Day Share Price2020/07/02 00:00
Earnings2020/03/31
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.