Honghua Group Limited, an investment holding company, engages in the research, design, manufacture, setting, and sale of land rigs, related parts, and components. More Details
Reasonable growth potential and slightly overvalued.
Share Price & News
How has Honghua Group's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: 196 is not significantly more volatile than the rest of Hong Kong stocks over the past 3 months, typically moving +/- 8% a week.
Volatility Over Time: 196's weekly volatility (8%) has been stable over the past year.
7 Day Return
HK Energy Services
1 Year Return
HK Energy Services
Return vs Industry: 196 exceeded the Hong Kong Energy Services industry which returned 12% over the past year.
Return vs Market: 196 underperformed the Hong Kong Market which returned 21.7% over the past year.
Long-Term Price Volatility Vs. Market
How volatile is Honghua Group's share price compared to the market and industry in the last 5 years?
Simply Wall St News
4 weeks ago | Simply Wall StHonghua Group (HKG:196) Is Doing The Right Things To Multiply Its Share Price
1 month ago | Simply Wall StIf You Had Bought Honghua Group's (HKG:196) Shares Three Years Ago You Would Be Down 68%
2 months ago | Simply Wall StIs Honghua Group (HKG:196) A Risky Investment?
Is Honghua Group undervalued compared to its fair value and its price relative to the market?
Price to Earnings (PE) ratio
Share Price vs. Fair Value
Below Fair Value: Insufficient data to calculate 196's fair value to establish if it is undervalued.
Significantly Below Fair Value: Insufficient data to calculate 196's fair value to establish if it is undervalued.
Price To Earnings Ratio
PE vs Industry: 196 is poor value based on its PE Ratio (25.3x) compared to the Hong Kong Energy Services industry average (14x).
PE vs Market: 196 is poor value based on its PE Ratio (25.3x) compared to the Hong Kong market (11.5x).
Price to Earnings Growth Ratio
PEG Ratio: 196 is good value based on its PEG Ratio (0.6x)
Price to Book Ratio
PB vs Industry: 196 is good value based on its PB Ratio (0.3x) compared to the HK Energy Services industry average (0.6x).
How is Honghua Group forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: 196's forecast earnings growth (45.6% per year) is above the savings rate (1.5%).
Earnings vs Market: 196's earnings (45.6% per year) are forecast to grow faster than the Hong Kong market (19.4% per year).
High Growth Earnings: earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: 196's revenue (15.3% per year) is forecast to grow faster than the Hong Kong market (12.8% per year).
High Growth Revenue: 196's revenue (15.3% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: 196's Return on Equity is forecast to be low in 3 years time (6.2%).
How has Honghua Group performed over the past 5 years?
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: 196 has a large one-off gain of CN¥14.7M impacting its December 31 2020 financial results.
Growing Profit Margin: 196's current net profit margins (1.3%) are lower than last year (2.4%).
Past Earnings Growth Analysis
Earnings Trend: 196 has become profitable over the past 5 years, growing earnings by 56.7% per year.
Accelerating Growth: 196's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: 196 had negative earnings growth (-53.7%) over the past year, making it difficult to compare to the Energy Services industry average (-4.3%).
Return on Equity
High ROE: 196's Return on Equity (1.3%) is considered low.
How is Honghua Group's financial position?
Financial Position Analysis
Short Term Liabilities: 196's short term assets (CN¥7.8B) exceed its short term liabilities (CN¥5.2B).
Long Term Liabilities: 196's short term assets (CN¥7.8B) exceed its long term liabilities (CN¥2.3B).
Debt to Equity History and Analysis
Debt Level: 196's debt to equity ratio (99.8%) is considered high.
Reducing Debt: 196's debt to equity ratio has increased from 97.7% to 99.8% over the past 5 years.
Debt Coverage: 196's operating cash flow is negative, therefore debt is not well covered.
Interest Coverage: 196's interest payments on its debt are not well covered by EBIT (1.5x coverage).
What is Honghua Group current dividend yield, its reliability and sustainability?
Dividend Yield vs Market
Notable Dividend: Unable to evaluate 196's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.
High Dividend: Unable to evaluate 196's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.
Stability and Growth of Payments
Stable Dividend: Insufficient data to determine if 196's dividends per share have been stable in the past.
Growing Dividend: Insufficient data to determine if 196's dividend payments have been increasing.
Current Payout to Shareholders
Dividend Coverage: 196 is not paying a notable dividend for the Hong Kong market.
Future Payout to Shareholders
Future Dividend Coverage: No need to calculate the sustainability of 196's dividend in 3 years as they are not forecast to pay a notable one for the Hong Kong market.
How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Mi Zhang (63 yo)
Mr. Mi Zhang serves as the President of Honghua Group Limited and has been its Executive Director since June 2007. Mr. Zhang is responsible for the development of the ZJ70LC drilling rig, which was one of ...
CEO Compensation Analysis
Compensation vs Market: Mi's total compensation ($USD226.25K) is about average for companies of similar size in the Hong Kong market ($USD277.08K).
Compensation vs Earnings: Mi's compensation has been consistent with company performance over the past year.
Experienced Management: 196's management team is considered experienced (4.5 years average tenure).
Experienced Board: 196's board of directors are considered experienced (4.3 years average tenure).
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.
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Honghua Group Limited's company bio, employee growth, exchange listings and data sources
- Name: Honghua Group Limited
- Ticker: 196
- Exchange: SEHK
- Founded: 1997
- Industry: Oil and Gas Equipment and Services
- Sector: Energy
- Market Cap: HK$1.492b
- Shares outstanding: 5.23b
- Website: https://www.hh-gltd.com
Number of Employees
- Honghua Group Limited
- Information Park
- 99 East Road
- Sichuan Province
Honghua Group Limited, an investment holding company, engages in the research, design, manufacture, setting, and sale of land rigs, related parts, and components. It operates through Land Drilling Rigs; Pa...
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2021/06/20 10:20|
|End of Day Share Price||2021/06/18 00:00|
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.