CPMC Holdings (SEHK:906) - Share price, News & Analysis

Q: What is the Fair Price of 906 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

906 (HK$3.4) is trading below our estimate of [[fair value]] (HK$7.06)

906 fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	2/6
Past Performance	4/6
Financial Health	4/6
Dividends	3/6

906 Stock Overview

CPMC Holdings Limited, an investment holding company, manufactures and sells packaging products for various consumer goods in the People’s Republic of China.

Rewards

Trading at 51.8% below our estimate of its fair value

Earnings are forecast to grow 12.12% per year

Earnings grew by 18.8% over the past year

Risk Analysis

Dividend of 7.13% is not well covered by earnings

CPMC Holdings Competitors

Southeast Asia Properties & Finance

SEHK:252

HK$732.6m

China Aluminum Cans Holdings

SEHK:6898

HK$360.7m

Yik Wo International Holdings

SEHK:8659

HK$228.3m

MS Group Holdings

SEHK:1451

HK$140.0m

Price History & Performance

Summary of all time highs, changes and price drops for CPMC Holdings
Historical stock prices
Current Share Price	HK$3.40
52 Week High	HK$5.27
52 Week Low	HK$3.09
Beta	0.54
1 Month Change	4.94%
3 Month Change	-17.87%
1 Year Change	-25.28%
3 Year Change	12.96%
5 Year Change	-11.92%
Change since IPO	-44.35%

Recent News & Updates

Jan 14

With EPS Growth And More, CPMC Holdings (HKG:906) Is Interesting

It's only natural that many investors, especially those who are new to the game, prefer to buy shares in 'sexy' stocks...

Shareholder Returns

	906	HK Packaging	HK Market
7D	3.0%	-0.5%	3.1%
1Y	-25.3%	-29.0%	-21.2%

Return vs Industry: 906 exceeded the Hong Kong Packaging industry which returned -29% over the past year.

Return vs Market: 906 underperformed the Hong Kong Market which returned -21.2% over the past year.

Price Volatility

Is 906's price volatile compared to industry and market?
906 volatility
906 Average Weekly Movement	3.7%
Packaging Industry Average Movement	5.8%
Market Average Movement	6.9%
10% most volatile stocks in HK Market	13.7%
10% least volatile stocks in HK Market	3.3%

Stable Share Price: 906 is less volatile than 75% of Hong Kong stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: 906's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2009	6,049	Ye Zhang	https://www.cofcopack.com

CPMC Holdings Limited, an investment holding company, manufactures and sells packaging products for various consumer goods in the People’s Republic of China. The company operates through Tinplate Packaging, Aluminum Packaging, and Plastic Packaging units. The Tinplate Packaging unit offers three-piece beverage cans; food cans, including milk powder cans; aerosol cans; metal caps; printed and coated tinplates; steel barrels; round and square shaped cans; and other metal packaging products.

CPMC Holdings Fundamentals Summary

How do CPMC Holdings's earnings and revenue compare to its market cap?
906 fundamental statistics
Market Cap	CN¥3.21b
Earnings (TTM)	CN¥462.50m
Revenue (TTM)	CN¥9.57b

7.0x

P/E Ratio

0.3x

P/S Ratio

Is 906 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
906 income statement (TTM)
Revenue	CN¥9.57b
Cost of Revenue	CN¥8.24b
Gross Profit	CN¥1.33b
Other Expenses	CN¥867.71m
Earnings	CN¥462.50m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.42
Gross Margin	13.91%
Net Profit Margin	4.83%
Debt/Equity Ratio	72.4%

How did 906 perform over the long term?

See historical performance and comparison

Dividends

7.1%

Current Dividend Yield

50%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 906 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 906?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 906. This is calculated by dividing 906's market cap by their current preferred multiple.
What is 906's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	CN¥3.21b

906 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.6x
Enterprise Value/EBITDA	6.6x
PEG Ratio	0.6x

Price to Earnings Ratio vs Peers

How does 906's PE Ratio compare to its peers?

906 PE Ratio vs Peers

The above table shows the PE ratio for 906 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	10.9x
252 Southeast Asia Properties & Finance	9.2x	n/a	HK$732.6m
6898 China Aluminum Cans Holdings	19.9x	n/a	HK$360.7m
8659 Yik Wo International Holdings	5.5x	n/a	HK$228.3m
1451 MS Group Holdings	9.1x	n/a	HK$140.0m
906 CPMC Holdings	7x	12.1%	HK$3.8b

Forward PE

Price-To-Earnings vs Peers: 906 is good value based on its Price-To-Earnings Ratio (7x) compared to the peer average (10.9x).

Price to Earnings Ratio vs Industry

How does 906's PE Ratio compare vs other companies in the Asian Packaging Industry?

Price-To-Earnings vs Industry: 906 is good value based on its Price-To-Earnings Ratio (7x) compared to the Hong Kong Packaging industry average (7.7x)

Price to Earnings Ratio vs Fair Ratio

What is 906's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

906 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	7x
Fair PE Ratio	6.5x

Price-To-Earnings vs Fair Ratio: 906 is expensive based on its Price-To-Earnings Ratio (7x) compared to the estimated Fair Price-To-Earnings Ratio (6.5x).

Share Price vs Fair Value

What is the Fair Price of 906 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 906 (HK$3.4) is trading below our estimate of fair value (HK$7.06)

Significantly Below Fair Value: 906 is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: 906 is good value based on its PEG Ratio (0.6x)

Discover undervalued companies

Future Growth

How is CPMC Holdings forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

12.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 906's forecast earnings growth (12.1% per year) is above the savings rate (1.6%).

Earnings vs Market: 906's earnings (12.1% per year) are forecast to grow slower than the Hong Kong market (17.1% per year).

High Growth Earnings: 906's earnings are forecast to grow, but not significantly.

Revenue vs Market: 906's revenue (12.7% per year) is forecast to grow faster than the Hong Kong market (10.2% per year).

High Growth Revenue: 906's revenue (12.7% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 906's Return on Equity is forecast to be low in 3 years time (11.5%).

Discover growth companies

Past Performance

How has CPMC Holdings performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

9.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 906 has high quality earnings.

Growing Profit Margin: 906's current net profit margins (4.8%) are lower than last year (5.3%).

Past Earnings Growth Analysis

Earnings Trend: 906's earnings have grown by 9.6% per year over the past 5 years.

Accelerating Growth: 906's earnings growth over the past year (18.8%) exceeds its 5-year average (9.6% per year).

Earnings vs Industry: 906 earnings growth over the past year (18.8%) exceeded the Packaging industry -3.2%.

Return on Equity

High ROE: 906's Return on Equity (8.1%) is considered low.

Discover strong past performing companies

Financial Health

How is CPMC Holdings's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 906's short term assets (CN¥6.8B) exceed its short term liabilities (CN¥4.9B).

Long Term Liabilities: 906's short term assets (CN¥6.8B) exceed its long term liabilities (CN¥2.3B).

Debt to Equity History and Analysis

Debt Level: 906's net debt to equity ratio (38.4%) is considered satisfactory.

Reducing Debt: 906's debt to equity ratio has increased from 50.2% to 72.4% over the past 5 years.

Debt Coverage: 906's debt is not well covered by operating cash flow (15.5%).

Interest Coverage: 906 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

Discover healthy companies

Dividend

What is CPMC Holdings's current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

7.13%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 906's dividend (7.13%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.71%).

High Dividend: 906's dividend (7.13%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.74%).

Stability and Growth of Payments

Stable Dividend: 906's dividend payments have been volatile in the past 10 years.

Growing Dividend: 906's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (49.8%), 906's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: 906 is paying a dividend but the company has no free cash flows.

Discover strong dividend paying companies

Management

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

5.9yrs

Average management tenure

CEO

Ye Zhang (48 yo)

5.92yrs

Tenure

CN¥1,695,000

Compensation

Mr. Ye Zhang has been General Manager of CPMC Holdings Limited since July 19, 2016 and was its Managing Director and General Corporate Counsel and also served as its chief legal consultant from July 2011 t...

CEO Compensation Analysis

Compensation vs Market: Ye's total compensation ($USD252.95K) is below average for companies of similar size in the Hong Kong market ($USD415.35K).

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

Leadership Team

Experienced Management: 906's management team is seasoned and experienced (5.9 years average tenure).

Board Members

Experienced Board: 906's board of directors are considered experienced (5.8 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.

Data	Last Updated (UTC time)
Company Analysis	2022/06/30 00:00
End of Day Share Price	2022/06/30 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31