SEHK:347

Stock Analysis Report

Executive Summary

Angang Steel Company Limited engages in the production, processing, and sale of steel products in the People’s Republic of China.

Rewards

Trading at 38.2% below its fair value

Earnings are forecast to grow 23.81% per year

Risk Analysis

Unstable dividend track record

Profit margins (2.7%) are lower than last year (9.4%)



Snowflake Analysis

Very undervalued with excellent balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has Angang Steel's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 347 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

5.3%

347

7.0%

HK Metals and Mining

1.7%

HK Market


1 Year Return

-37.3%

347

-5.1%

HK Metals and Mining

-2.9%

HK Market

Return vs Industry: 347 underperformed the Hong Kong Metals and Mining industry which returned -5.1% over the past year.

Return vs Market: 347 underperformed the Hong Kong Market which returned -2.9% over the past year.


Shareholder returns

347IndustryMarket
7 Day5.3%7.0%1.7%
30 Day-12.8%-3.8%-4.8%
90 Day6.9%17.0%3.4%
1 Year-34.8%-37.3%-2.0%-5.1%0.7%-2.9%
3 Year-33.5%-39.2%-6.2%-12.2%15.3%3.6%
5 Year-29.3%-35.9%9.8%-1.7%15.9%-3.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Angang Steel undervalued compared to its fair value and its price relative to the market?

38.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 347 (HK$2.8) is trading below our estimate of fair value (HK$4.53)

Significantly Below Fair Value: 347 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 347 is good value based on its PE Ratio (8.4x) compared to the Metals and Mining industry average (10.3x).

PE vs Market: 347 is good value based on its PE Ratio (8.4x) compared to the Hong Kong market (10.1x).


Price to Earnings Growth Ratio

PEG Ratio: 347 is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: 347 is good value based on its PB Ratio (0.5x) compared to the HK Metals and Mining industry average (0.7x).


Next Steps

Future Growth

How is Angang Steel forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

23.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 347's forecast earnings growth (23.8% per year) is above the savings rate (1.6%).

Earnings vs Market: 347's earnings (23.8% per year) are forecast to grow faster than the Hong Kong market (11.7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 347's revenue is expected to decline over the next 3 years (-2.3% per year).

High Growth Revenue: 347's revenue is forecast to decline over the next 3 years (-2.3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 347's Return on Equity is forecast to be low in 3 years time (5.3%).


Next Steps

Past Performance

How has Angang Steel performed over the past 5 years?

47.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 347 has high quality earnings.

Growing Profit Margin: 347's current net profit margins (2.7%) are lower than last year (9.4%).


Past Earnings Growth Analysis

Earnings Trend: 347's earnings have grown significantly by 47.4% per year over the past 5 years.

Accelerating Growth: 347's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 347 had negative earnings growth (-70.9%) over the past year, making it difficult to compare to the Metals and Mining industry average (-25%).


Return on Equity

High ROE: 347's Return on Equity (5.4%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Angang Steel's financial position?


Financial Position Analysis

Short Term Liabilities: 347's short term assets (CN¥26.1B) do not cover its short term liabilities (CN¥31.0B).

Long Term Liabilities: 347's short term assets (CN¥26.1B) exceed its long term liabilities (CN¥6.1B).


Debt to Equity History and Analysis

Debt Level: 347's debt to equity ratio (37.9%) is considered satisfactory.

Reducing Debt: 347's debt to equity ratio has reduced from 57.3% to 37.9% over the past 5 years.

Debt Coverage: 347's debt is well covered by operating cash flow (34.7%).

Interest Coverage: 347's interest payments on its debt are well covered by EBIT (4.2x coverage).


Balance Sheet

Inventory Level: 347 has a high level of physical assets or inventory.

Debt Coverage by Assets: 347's debt is covered by short term assets (assets are 1.3x debt).


Next Steps

Dividend

What is Angang Steel's current dividend yield, its reliability and sustainability?

6.72%

Current Dividend Yield


Dividend Yield vs Market

company6.7%marketbottom25%2.3%markettop25%6.3%industryaverage3.8%forecastin3Years3.2%

Current dividend yield vs market & industry

Notable Dividend: 347's dividend (6.72%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.27%).

High Dividend: 347's dividend (6.72%) is in the top 25% of dividend payers in the Hong Kong market (6.34%)


Stability and Growth of Payments

Stable Dividend: 347's dividend payments have been volatile in the past 10 years.

Growing Dividend: 347's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (56.5%), 347's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 347's dividends in 3 years are forecast to be well covered by earnings (23.8% payout ratio).


Next Steps

Management

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

3.1yrs

Average management tenure


CEO

Angang Steel has no CEO, or we have no data on them.


Leadership Team

NamePositionTenureCompensationOwnership
Yidong Wang
Executive Chairman2.3yrsno data0.00011% CN¥32.4k
Lianyong Ma
Deputy GM1.9yrsCN¥890.00kno data
Zhongwu Li
Deputy General Manager0.2yrsCN¥110.00kno data
Shishuai Xu
VP & Deputy GM3.9yrsCN¥1.57mno data
Jingsong Meng
VP & Deputy GM3.9yrsCN¥1.55mno data
Zhen Li
Deputy GM & Executive Director1.9yrsCN¥1.17mno data
Chun Chen
Joint Company Secretary2.3yrsno datano data
Wu Guo
Controller0yrsno datano data

3.1yrs

Average Tenure

49yo

Average Age

Experienced Management: 347's management team is considered experienced (3.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Yidong Wang
Executive Chairman2.3yrsno data0.00011% CN¥32.4k
Lianyong Ma
Deputy GM1.9yrsCN¥890.00kno data
Zhen Li
Deputy GM & Executive Director1.9yrsCN¥1.17mno data
Weiguo Ma
Independent Non-Executive Director0yrsCN¥120.00kno data
Dajun Wu
Independent Non-Executive Director0yrsCN¥120.00kno data
Xiaohui Liu
Supervisor0.8yrsno datano data
Peng Yuan
Supervisor0yrsno datano data
Changli Feng
Independent Non-Executive Director1.7yrsCN¥70.00kno data
Yongli Lu
Chairman of Supervisory Committee0.8yrsno datano data
Jianhua Wang
Independent Non-Executive Director0.8yrsno datano data

1.7yrs

Average Tenure

50.5yo

Average Age

Experienced Board: 347's board of directors are not considered experienced ( 1.7 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.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Angang Steel Company Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Angang Steel Company Limited
  • Ticker: 347
  • Exchange: SEHK
  • Founded: 1997
  • Industry: Steel
  • Sector: Materials
  • Market Cap: HK$29.415b
  • Shares outstanding: 9.41b
  • Website: https://www.ansteel.com.cn

Number of Employees


Location

  • Angang Steel Company Limited
  • Angang factory
  • Tie Xi District
  • Anshan
  • Liaoning Province
  • 114021
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ANGG.FOTCPK (Pink Sheets LLC)YesForeign Shares-Foreign ListedUSUSDJul 1997
347SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDJul 1997
GNVDB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEURJul 1997
347SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDJul 1997
898SZSE (Shenzhen Stock Exchange)Domestic SharesCNCNYNov 1997
898XSEC (Shenzhen Stock Exchange - Shenzhen-Hong Kong Stock Connect)Domestic SharesCNCNYNov 1997

Biography

Angang Steel Company Limited engages in the production, processing, and sale of steel products in the People’s Republic of China. Its principal products include hot rolled sheets, cold rolled sheets, galvanized steel sheets, color coating plates, medium and thick plates, heavy sections, heavy rails, wire rods, seamless steel pipes, and cold rolled silicon steel products. The company also engages in ferrous metal smelting and steel pressing activities. In addition, it sells building materials, etc.; provides wholesale and retail purchasing services; develops metallurgy and related materials and equipment; and purchases and sells metal and other materials, as well as imports, exports, wholesales, and retails technology products. Further, the company engages in the purification of cooking gas; production of coal products; production of dissolved acetylene; and sale of compressed and liquefied gas. The company’s products are used in various industries, such as machinery, metallurgy, petroleum, chemical, coal, power, railway, shipbuilding, automobile, construction, home electrical appliances, and aviation. It also exports its products. The company was formerly known as Angang New Steel Company Limited and changed its name to Angang Steel Company Limited in June 2006. The company was founded in 1997 and is headquartered in Anshan, the People’s Republic of China. Angang Steel Company Limited is a subsidiary of Anshan Iron and Steel Group Co., Ltd. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/17 12:41
End of Day Share Price2020/02/17 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


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.