SEHK:2189

Stock Analysis Report

Kato (Hong Kong) Holdings

Executive Summary

Kato (Hong Kong) Holdings Limited operates residential care homes for the elderly in Hong Kong.


Snowflake Analysis

Flawless balance sheet with outstanding track record.

Share Price & News

How has Kato (Hong Kong) Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 2189 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0%

2189

-3.8%

HK Healthcare

-3.2%

HK Market


1 Year Return

n/a

2189

-24.2%

HK Healthcare

-10.2%

HK Market

Return vs Industry: Insufficient data to determine how 2189 performed against the Hong Kong Healthcare industry.

Return vs Market: Insufficient data to determine how 2189 performed against the Hong Kong Market.


Shareholder returns

2189IndustryMarket
7 Day0%-3.8%-3.2%
30 Day-3.5%-6.1%-3.3%
90 Day-1.8%-6.0%0.2%
1 Yearn/a-22.5%-24.2%-6.9%-10.2%
3 Yearn/a-31.2%-35.3%11.7%0.4%
5 Yearn/a-24.0%-30.3%11.1%-7.3%

Price Volatility Vs. Market

How volatile is Kato (Hong Kong) Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Kato (Hong Kong) Holdings undervalued compared to its fair value and its price relative to the market?

31.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 2189 (HK$0.56) is trading below our estimate of fair value (HK$0.81)

Significantly Below Fair Value: 2189 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 2189 is good value based on its PE Ratio (11x) compared to the Healthcare industry average (16.3x).

PE vs Market: 2189 is poor value based on its PE Ratio (11x) compared to the Hong Kong market (10.1x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 2189's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 2189 is overvalued based on its PB Ratio (3x) compared to the HK Healthcare industry average (1.5x).


Next Steps

Future Growth

How is Kato (Hong Kong) Holdings forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

18.6%

Forecasted Healthcare industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Kato (Hong Kong) Holdings has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Kato (Hong Kong) Holdings performed over the past 5 years?

7.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 2189 has high quality earnings.

Growing Profit Margin: 2189's current net profit margins (22.7%) are higher than last year (22.3%).


Past Earnings Growth Analysis

Earnings Trend: 2189's earnings have grown by 7.8% per year over the past 5 years.

Accelerating Growth: 2189's earnings growth over the past year (12.6%) exceeds its 5-year average (7.8% per year).

Earnings vs Industry: 2189 earnings growth over the past year (12.6%) exceeded the Healthcare industry 10.4%.


Return on Equity

High ROE: 2189's Return on Equity (22.5%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Kato (Hong Kong) Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 2189's short term assets (HK$193.0M) exceed its short term liabilities (HK$42.6M).

Long Term Liabilities: 2189's short term assets (HK$193.0M) exceed its long term liabilities (HK$131.3M).


Debt to Equity History and Analysis

Debt Level: 2189 is debt free.

Reducing Debt: 2189 had no debt 5 years ago.

Debt Coverage: 2189 has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 2189 has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: 2189 has a high level of physical assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if 2189's debt is covered by short term assets.


Next Steps

Dividend

What is Kato (Hong Kong) Holdings's current dividend yield, its reliability and sustainability?

7.27%

Current Dividend Yield


Dividend Yield vs Market

company7.3%marketbottom25%2.3%markettop25%6.4%industryaverage2.7%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: 2189's dividend (7.14%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.29%).

High Dividend: 2189's dividend (7.14%) is in the top 25% of dividend payers in the Hong Kong market (6.34%)


Stability and Growth of Payments

Stable Dividend: Too early to tell whether 2189's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if 2189'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 (39.4%), 2189's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

1.2yrs

Average board tenure


CEO

Godfrey Ngai (45yo)

1.3yrs

Tenure

HK$618,000

Compensation

Mr. Shi Shing Ngai, also known as Godfrey, serves as an Executive Director and Chief Executive Officer of Kato (Hong Kong) Holdings Ltd., since October 02, 2018 and was appointed as its Director on April 1 ...


CEO Compensation Analysis

Compensation vs Market: Godfrey's total compensation ($USD79.36K) is below average for companies of similar size in the Hong Kong market ($USD226.90K).

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


Board Members

NamePositionTenureCompensationOwnership
Shi Shing Ngai
CEO & Executive Director1.3yrsHK$618.00k62.4% HK$349.4m
Ka Yee Ngai
Executive Director1.3yrsHK$600.00kno data
Lai Kuen Chiu
Independent Non-Executive Director1.1yrsno datano data
Vinci Wong
Independent Non-Executive Director1.1yrsno datano data
Kevin Or
Independent Non-Executive Director1.1yrsno datano data
Kai To Kwong
Non-Executive Chairman1.3yrsHK$600.00kno data

1.2yrs

Average Tenure

53.5yo

Average Age

Experienced Board: 2189's board of directors are not considered experienced ( 1.2 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: 2189 only recently listed within the past 12 months, with total shares outstanding growing by 10% in the past year..


Top Shareholders

Company Information

Kato (Hong Kong) Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Kato (Hong Kong) Holdings Limited
  • Ticker: 2189
  • Exchange: SEHK
  • Founded: 1991
  • Industry: Health Care Facilities
  • Sector: Healthcare
  • Market Cap: HK$560.000m
  • Shares outstanding: 1.00b
  • Website: https://www.elderlyhk.com

Number of Employees


Location

  • Kato (Hong Kong) Holdings Limited
  • Tung Wai Court
  • 1st Floor
  • Tuen Mun
  • New Territories
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2189SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDJun 2019

Biography

Kato (Hong Kong) Holdings Limited operates residential care homes for the elderly in Hong Kong. The company provides a range of residential care services for the elderly, including accommodation, professional nursing and care-taking, nutritional management, medical, physiotherapy and occupational therapy, psychological and social care, individual care, and recreational services; and sells healthcare and medical goods, as well as offers add-on healthcare services to its residents. As of March 31, 2019, it operated eight care and attention homes for the elderly with 1,129 residential care places operating across four districts in Hong Kong under the Fai To, Kato, Happy Luck Home, Tsuen Wan Centre, and Pine Villa brand names. The company was founded in 1991 and is based in Tuen Mun, Hong Kong. Kato (Hong Kong) Holdings Limited is a subsidiary of Sheung Fung Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/25 13:29
End of Day Share Price2020/02/25 00:00
Earnings2019/09/30
Annual Earnings2019/03/31


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.