SEHK:288

Stock Analysis Report

Executive Summary

WH Group Limited, an investment holding company, engages in the production, wholesale, and retail sale of meat products in China, the United States, and internationally.


Snowflake Analysis

Flawless balance sheet with proven track record.


Similar Companies

Share Price & News

How has WH Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 288 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

15.0%

288

5.7%

HK Food

4.0%

HK Market


1 Year Return

-13.5%

288

-10.3%

HK Food

-20.1%

HK Market

Return vs Industry: 288 underperformed the Hong Kong Food industry which returned -10.3% over the past year.

Return vs Market: 288 exceeded the Hong Kong Market which returned -20.1% over the past year.


Shareholder returns

288IndustryMarket
7 Day15.0%5.7%4.0%
30 Day-12.3%-5.9%-11.3%
90 Day-9.8%-5.9%-15.6%
1 Year-11.0%-13.5%-7.9%-10.3%-17.2%-20.1%
3 Year19.9%8.5%30.3%20.7%-2.9%-12.7%
5 Year75.6%54.4%3.1%-7.1%-6.8%-21.8%

Price Volatility Vs. Market

How volatile is WH Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is WH Group 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: 288 (HK$7.27) is trading below our estimate of fair value (HK$16.45)

Significantly Below Fair Value: 288 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 288 is good value based on its PE Ratio (9.4x) compared to the Food industry average (11.3x).

PE vs Market: 288 is poor value based on its PE Ratio (9.4x) compared to the Hong Kong market (9x).


Price to Earnings Growth Ratio

PEG Ratio: 288 is poor value based on its PEG Ratio (2.9x)


Price to Book Ratio

PB vs Industry: 288 is overvalued based on its PB Ratio (1.6x) compared to the HK Food industry average (0.7x).


Next Steps

Future Growth

How is WH Group forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

3.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 288's forecast earnings growth (3.3% per year) is above the savings rate (1.6%).

Earnings vs Market: 288's earnings (3.3% per year) are forecast to grow slower than the Hong Kong market (12.8% per year).

High Growth Earnings: 288's earnings are forecast to grow, but not significantly.

Revenue vs Market: 288's revenue (3.8% per year) is forecast to grow slower than the Hong Kong market (9.1% per year).

High Growth Revenue: 288's revenue (3.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 288's Return on Equity is forecast to be low in 3 years time (14.7%).


Next Steps

Past Performance

How has WH Group performed over the past 5 years?

11.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 288 has a large one-off gain of $376.0M impacting its December 31 2019 financial results.

Growing Profit Margin: 288's current net profit margins (6.1%) are higher than last year (4.2%).


Past Earnings Growth Analysis

Earnings Trend: 288's earnings have grown by 11.5% per year over the past 5 years.

Accelerating Growth: 288's earnings growth over the past year (55.4%) exceeds its 5-year average (11.5% per year).

Earnings vs Industry: 288 earnings growth over the past year (55.4%) exceeded the Food industry 6.4%.


Return on Equity

High ROE: 288's Return on Equity (17.9%) is considered low.


Next Steps

Financial Health

How is WH Group's financial position?


Financial Position Analysis

Short Term Liabilities: 288's short term assets ($6.7B) exceed its short term liabilities ($3.9B).

Long Term Liabilities: 288's short term assets ($6.7B) exceed its long term liabilities ($4.0B).


Debt to Equity History and Analysis

Debt Level: 288's debt to equity ratio (32.7%) is considered satisfactory.

Reducing Debt: 288's debt to equity ratio has reduced from 77.1% to 32.7% over the past 5 years.

Debt Coverage: 288's debt is well covered by operating cash flow (47.3%).

Interest Coverage: 288's interest payments on its debt are well covered by EBIT (13.5x coverage).


Balance Sheet

Inventory Level: 288 has a high level of physical assets or inventory.

Debt Coverage by Assets: 288's debt is covered by short term assets (assets are 2.2x debt).


Next Steps

Dividend

What is WH Group's current dividend yield, its reliability and sustainability?

4.33%

Current Dividend Yield


Upcoming Dividend Payment

TodayMar 28 2020Ex Dividend DateJun 05 2020Dividend Pay DateJul 06 202031 days from Ex DividendBuy in the next 68 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: 288's dividend (4.33%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.67%).

High Dividend: 288's dividend (4.33%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.33%).


Stability and Growth of Payments

Stable Dividend: 288 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 288's dividend payments have increased, but the company has only paid a dividend for 4 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (40.6%), 288's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 288's dividends in 3 years are forecast to be well covered by earnings (42.1% payout ratio).


Next Steps

Management

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

5.2yrs

Average management tenure


CEO

Long Wan (79yo)

6.42s

Tenure

US$8,000,000

Compensation

Mr. Long Wan serves as the Chairman and President at Huamao Shuanghui Industry (Group) Co. Ltd. Mr. Wan serves as the President and General Manager of Henan Shuanghui Industry Group Co., Ltd. He has been t ...


CEO Compensation Analysis

Compensation vs Market: Long's total compensation ($USD8.00M) is above average for companies of similar size in the Hong Kong market ($USD1.20M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Long Wan
Chairman of the Board & CEO6.42yrsUS$8.00m3.92% $4.2b
Hongjian Wan
Deputy Chairman & VP1.58yrsno datano data
Lijun Guo
CFO, Executive VP & Executive Director6.25yrsUS$3.00m0.014% $14.5m
Kenneth Sullivan
Executive Director4.17yrsUS$4.00mno data
Xiangjie Ma
President of Shuanghui Development & Executive Director1.75yrsno data0.000020% $21.3k
Luis Chein
Group Director and Head of Investor Relationsno datano datano data
Ho Chau
Chief Legal Officer & Company Secretary6.08yrsno datano data
Dhamu Thamodaran
Executive VP & Chief Commodity Hedging Officer of Smithfield Foodno datano datano data
Songtao Liu
Executive VP & CFO of Shuanghui Development2.25yrsno datano data
Glenn Nunziata
Executive VP & CFO of Smithfield Foodsno datano datano data

5.2yrs

Average Tenure

51yo

Average Age

Experienced Management: 288's management team is seasoned and experienced (5.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Long Wan
Chairman of the Board & CEO6.42yrsUS$8.00m3.92% $4.2b
Hongjian Wan
Deputy Chairman & VP1.58yrsno datano data
Lijun Guo
CFO, Executive VP & Executive Director6.25yrsUS$3.00m0.014% $14.5m
Kenneth Sullivan
Executive Director4.17yrsUS$4.00mno data
Xiangjie Ma
President of Shuanghui Development & Executive Director1.75yrsno data0.000020% $21.3k
Kong Wai Lee
Independent Non-Executive Director5.67yrsno datano data
Shuge Jiao
Non-Executive Director13.92yrsno datano data
Ming Huang
Independent Non-Executive Director5.67yrsno datano data
Jin Tin Lau
Independent Non-Executive Director5.67yrsno datano data

5.7yrs

Average Tenure

55yo

Average Age

Experienced Board: 288's board of directors are considered experienced (5.7 years average tenure).


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

WH Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: WH Group Limited
  • Ticker: 288
  • Exchange: SEHK
  • Founded: 1958
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Market Cap: HK$106.691b
  • Shares outstanding: 14.68b
  • Website: https://www.wh-group.com

Number of Employees


Location

  • WH Group Limited
  • International Commerce Centre
  • Level 76
  • Kowloon
  • Kowloon
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
288SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDAug 2014
0WHDB (Deutsche Boerse AG)YesOrdinary SharesDEEURAug 2014
288SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesOrdinary SharesHKHKDAug 2014
WHGR.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDAug 2014
288SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesOrdinary SharesHKHKDAug 2014
WHGL.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDNov 2014
0WHSDB (Deutsche Boerse AG)SPONSORED ADRDEEURNov 2014

Biography

WH Group Limited, an investment holding company, engages in the production, wholesale, and retail sale of meat products in China, the United States, and internationally. It operates through Packaged Meats, Fresh Pork, Hog Production, and Others segments. It is also involved in the slaughtering, wholesale, and retail sale of fresh and frozen meat; and hog farming activities. In addition, the company engages in the manufacture and sale of packaging materials; provision of logistics services; operation of a chain of retail grocery stores; and production of flavoring ingredients and natural casings and biological pharmaceutical materials. Further, it is involved in the livestock breeding and slaughtering activities. The company was formerly known as Shuanghui International Holdings Limited and changed its name to WH Group Limited in January 2014. The company was founded in 1958 and is headquartered in Kowloon, Hong Kong. WH Group Limited is a subsidiary of Heroic Zone Investments Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/28 13:14
End of Day Share Price2020/03/27 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.