Stock Analysis

Unveiling Three Undiscovered Gems In Hong Kong With Strong Potential

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As global markets continue to show mixed results, with small-cap stocks outpacing large-cap growth shares, investors are increasingly looking towards lesser-known opportunities. In this context, the Hong Kong market presents a unique landscape where undiscovered gems can offer significant potential. Identifying strong stocks often involves evaluating their resilience amid economic fluctuations and their capacity for sustainable growth in evolving market conditions.

Top 10 Undiscovered Gems With Strong Fundamentals In Hong Kong

NameDebt To EquityRevenue GrowthEarnings GrowthHealth Rating
S.A.S. Dragon Holdings37.35%4.13%12.06%★★★★★★
COSCO SHIPPING International (Hong Kong)NA-12.97%12.59%★★★★★★
PW Medtech GroupNA17.93%-2.70%★★★★★★
Tianyun International Holdings10.09%-5.59%-9.92%★★★★★★
JiaXing Gas Group17.72%26.04%22.07%★★★★★☆
Hung Hing Printing Group3.97%-2.51%33.57%★★★★★☆
Mulsanne Group Holding186.88%-12.02%-43.54%★★★★☆☆
Laopu Gold8.43%26.56%36.28%★★★★☆☆
Time Interconnect Technology212.50%27.21%15.01%★★★★☆☆
Pizu Group Holdings48.34%-4.53%-19.78%★★★★☆☆

Click here to see the full list of 176 stocks from our SEHK Undiscovered Gems With Strong Fundamentals screener.

Let's explore several standout options from the results in the screener.

Xiamen Yan Palace Bird's Nest Industry (SEHK:1497)

Simply Wall St Value Rating: ★★★★★★

Overview: Xiamen Yan Palace Bird's Nest Industry Co., Ltd., together with its subsidiaries, engages in the research, development, production, and marketing of edible bird’s nest (EBN) products in the People’s Republic of China with a market cap of HK$6.99 billion.

Operations: The primary revenue streams for Xiamen Yan Palace Bird's Nest Industry Co., Ltd. include Direct Sales to Online Customers (CN¥824.40 million), Sales to Offline Distributors (CN¥509.04 million), and Direct Sales to Offline Customers (CN¥351.17 million).

Xiamen Yan Palace Bird's Nest Industry, a small cap stock, has no debt and boasts high-quality non-cash earnings. Over the past year, its earnings growth of 4.9% surpassed the Food industry’s 4.1%. The company expects revenue between RMB 1.05 billion to RMB 1.09 billion for H1 2024, up by roughly 10-15% from last year, though net profit may drop by around 40-50%. Notably, a final dividend of RMB 2.15 per share was approved in May.

SEHK:1497 Debt to Equity as at Jul 2024

MicroPort NeuroTech (SEHK:2172)

Simply Wall St Value Rating: ★★★★★★

Overview: MicroPort NeuroTech Limited focuses on the research, development, production, and sale of neuro-interventional medical devices in China and internationally, with a market cap of approximately HK$4.59 billion.

Operations: MicroPort NeuroTech Limited generates revenue primarily from the sale of surgical and medical equipment, amounting to CN¥665.62 million. The company's market cap is approximately HK$4.59 billion.

MicroPort NeuroTech, recently renamed MicroPort NeuroScientific Corporation, has shown significant growth. The company reported a net profit of RMB 130 million to RMB 150 million for the first half of 2024, up by approximately 124% to 158% from the previous year. Revenue is expected to reach RMB 400 million to RMB 410 million, marking a rise of around 34% to 37%. This debt-free entity trades at about half its estimated fair value and boasts high-quality earnings.

SEHK:2172 Earnings and Revenue Growth as at Jul 2024

Wasion Holdings (SEHK:3393)

Simply Wall St Value Rating: ★★★★★☆

Overview: Wasion Holdings Limited is an investment holding company that focuses on the research, development, production, and sale of energy metering and energy efficiency management solutions for various global markets, with a market cap of HK$6.23 billion.

Operations: Wasion Holdings generates revenue primarily from three segments: Power Advanced Metering Infrastructure (CN¥2.67 billion), Advanced Distribution Operations (CN¥2.48 billion), and Communication and Fluid Advanced Metering Infrastructure (CN¥2.21 billion).

Wasion Holdings has been making significant strides in the smart meter industry, recently securing contracts worth EUR 31.62 million in Hungary and USD 15.16 million across Singapore and Malaysia. The company repurchased shares this year, indicating confidence in its value proposition. With earnings growth of 61% over the past year, Wasion's performance outpaced the Electronic industry’s -8.7%. Trading at 34% below estimated fair value and having high-quality earnings further underscore its potential as an investment opportunity.

SEHK:3393 Debt to Equity as at Jul 2024

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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