SEHK:2119

Stock Analysis Report

Tsit Wing International Holdings

Executive Summary

Tsit Wing International Holdings Limited, an investment holding company, provides beverages and food products in the People’s Republic of China and internationally.

Rewards

Trading at 72.4% below its fair value

Earnings are forecast to grow 9.64% per year

Earnings grew by 18.5% over the past year

Risk Analysis

Unstable dividend track record

Highly volatile share price over past 3 months

Shareholders have been diluted in the past year

Does not have a meaningful market cap (HK$733M)



Snowflake Analysis

Undervalued with solid track record.

Share Price & News

How has Tsit Wing International Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 2119's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-1.0%

2119

-0.8%

HK Food

-0.4%

HK Market


1 Year Return

-41.3%

2119

-10.7%

HK Food

-22.7%

HK Market

Return vs Industry: 2119 underperformed the Hong Kong Food industry which returned -7.8% over the past year.

Return vs Market: 2119 underperformed the Hong Kong Market which returned -20.4% over the past year.


Shareholder returns

2119IndustryMarket
7 Day-1.0%-0.8%-0.4%
30 Day-17.6%-4.6%-11.2%
90 Day-10.1%-6.4%-17.3%
1 Year-38.0%-41.3%-8.3%-10.7%-19.9%-22.7%
3 Yearn/a27.7%18.2%-4.8%-14.4%
5 Yearn/a-1.4%-11.3%-12.3%-26.3%

Price Volatility Vs. Market

How volatile is Tsit Wing International Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Tsit Wing International Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 2119 (HK$0.98) is trading below our estimate of fair value (HK$3.55)

Significantly Below Fair Value: 2119 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 2119 is good value based on its PE Ratio (8.3x) compared to the Food industry average (12x).

PE vs Market: 2119 is good value based on its PE Ratio (8.3x) compared to the Hong Kong market (9.1x).


Price to Earnings Growth Ratio

PEG Ratio: 2119 is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: 2119 is overvalued based on its PB Ratio (1.4x) compared to the HK Food industry average (0.8x).


Next Steps

Future Growth

How is Tsit Wing International Holdings forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

9.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 2119's forecast earnings growth (9.6% per year) is above the savings rate (1.6%).

Earnings vs Market: 2119's earnings (9.6% per year) are forecast to grow slower than the Hong Kong market (11.8% per year).

High Growth Earnings: 2119's earnings are forecast to grow, but not significantly.

Revenue vs Market: 2119's revenue (4.2% per year) is forecast to grow slower than the Hong Kong market (10.2% per year).

High Growth Revenue: 2119's revenue (4.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 2119's Return on Equity is forecast to be low in 3 years time (17%).


Next Steps

Past Performance

How has Tsit Wing International Holdings performed over the past 5 years?

15.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 2119 has high quality earnings.

Growing Profit Margin: 2119's current net profit margins (11.4%) are higher than last year (7.1%).


Past Earnings Growth Analysis

Earnings Trend: 2119's earnings have grown by 15.6% per year over the past 5 years.

Accelerating Growth: 2119's earnings growth over the past year (18.5%) exceeds its 5-year average (15.6% per year).

Earnings vs Industry: 2119 earnings growth over the past year (18.5%) exceeded the Food industry 16.3%.


Return on Equity

High ROE: 2119's Return on Equity (16.3%) is considered low.


Next Steps

Financial Health

How is Tsit Wing International Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 2119's short term assets (HK$572.9M) exceed its short term liabilities (HK$169.8M).

Long Term Liabilities: 2119's short term assets (HK$572.9M) exceed its long term liabilities (HK$19.0M).


Debt to Equity History and Analysis

Debt Level: 2119's debt to equity ratio (4.8%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if 2119's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: 2119's debt is well covered by operating cash flow (495.7%).

Interest Coverage: 2119 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: 2119 has a high level of physical assets or inventory.

Debt Coverage by Assets: 2119's debt is covered by short term assets (assets are 21.9x debt).


Next Steps

Dividend

What is Tsit Wing International Holdings's current dividend yield, its reliability and sustainability?

6.80%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: 2119's dividend (6.8%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.56%).

High Dividend: 2119's dividend (6.8%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.14%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether 2119's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if 2119's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (49.7%), 2119's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 2119's dividends in 3 years are forecast to be thoroughly covered by earnings (0.1% payout ratio).


Next Steps

Management

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

2.3yrs

Average board tenure


CEO

Peter Wong (65yo)

no data

Tenure

HK$7,139,000

Compensation

Mr. Tat Tong Wong @ Wong Tak Tong serves as Chief Executive Officer of TSIT Wing International Holdings Ltd. at Tsit Wing (China) Holdings Limited and TSIT Wing (China) Investment Company Limited. Mr. Wong ...


CEO Compensation Analysis

Compensation vs Market: Peter's total compensation ($USD921.00K) is above average for companies of similar size in the Hong Kong market ($USD228.41K).

Compensation vs Earnings: Peter's compensation has been consistent with company performance over the past year.


Board Members

NamePositionTenureCompensationOwnership
Tat Tong Wong
Chairman & CEOno dataHK$7.14m64.03% HK$469.3m
Yee-Man Fan
Group CFO & Executive Director2.58yrsHK$2.61m0.074% HK$539.8k
Kam On Wu
Group COO10.25yrsHK$3.88m0.11% HK$809.1k
Kwai Chang Tang
Independent Non-Executive Director2.33yrsHK$200.00kno data
Yue Nong Chow
Independent Non-Executive Director2.33yrsHK$200.00kno data
Man Fai Wong
Independent Non-Executive Director2.33yrsHK$200.00kno data

2.3yrs

Average Tenure

65.5yo

Average Age

Experienced Board: 2119's board of directors are not considered experienced ( 2.3 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.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 7.8%.


Top Shareholders

Company Information

Tsit Wing International Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Tsit Wing International Holdings Limited
  • Ticker: 2119
  • Exchange: SEHK
  • Founded: 1932
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Market Cap: HK$733.018m
  • Shares outstanding: 747.98m
  • Website: https://www.twcoffee.com

Number of Employees


Location

  • Tsit Wing International Holdings Limited
  • Kwai Tak Industrial Centre
  • Flats F-J
  • Kwai Chung
  • New Territories
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2119SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDMay 2018

Biography

Tsit Wing International Holdings Limited, an investment holding company, provides beverages and food products in the People’s Republic of China and internationally. The company operates in two segments, Beverage Solutions and Food Products. The Beverage Solutions segment processes and distributes coffee, tea, and related complementary products; sells food and beverages, coffee machines, and other related products; operates food and beverage stores; and leases coffee and tea machines. The Food Products segment trades in frozen meat and frozen processed food. The company also engages in the processing of coffee beans. In addition, it provides catering training services. The company was founded in 1932 and is headquartered in Kwai Chung, Hong Kong. Tsit Wing International Holdings Limited is a subsidiary of Hero Valour Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 13:41
End of Day Share Price2020/04/01 00:00
Earnings2019/12/31
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.