Activation Group Holdings (SEHK:9919) - Share price, News & Analysis

Q: What is the Fair Price of 9919 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

9919 (HK$1.15) is trading below our estimate of [[fair value]] (HK$11.03)

9919 fundamental analysis
Snowflake Score
Valuation	4/6
Future Growth	3/6
Past Performance	6/6
Financial Health	6/6
Dividends	3/6

9919 Stock Overview

Activation Group Holdings Limited, an investment holding company, primarily provides integrated marketing solutions in Mainland China, Hong Kong, and Singapore.

Rewards

Trading at 89.6% below our estimate of its fair value

Revenue is forecast to grow 26.49% per year

Earnings grew by 294.9% over the past year

Risk Analysis

Unstable dividend track record

Activation Group Holdings Competitors

Cheshi Technology

SEHK:1490

HK$624.0m

Adtiger Corporations

SEHK:1163

HK$641.2m

Pico Far East Holdings

SEHK:752

HK$1.4b

SinoMedia Holding

SEHK:623

HK$406.2m

Price History & Performance

Summary of all time highs, changes and price drops for Activation Group Holdings
Historical stock prices
Current Share Price	HK$1.15
52 Week High	HK$2.03
52 Week Low	HK$0.70
Beta	1.45
1 Month Change	1.77%
3 Month Change	-5.74%
1 Year Change	26.37%
3 Year Change	n/a
5 Year Change	n/a
Change since IPO	-26.75%

Shareholder Returns

	9919	HK Media	HK Market
7D	3.6%	5.7%	3.1%
1Y	26.4%	-46.7%	-21.2%

Return vs Industry: 9919 exceeded the Hong Kong Media industry which returned -46.4% over the past year.

Return vs Market: 9919 exceeded the Hong Kong Market which returned -20.1% over the past year.

Price Volatility

Is 9919's price volatile compared to industry and market?
9919 volatility
9919 Average Weekly Movement	4.3%
Media Industry Average Movement	10.4%
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: 9919 is less volatile than 75% of Hong Kong stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: 9919's weekly volatility has decreased from 11% to 4% over the past year.

About the Company

Founded	Employees	CEO	Website
2013	285	Steve Lau	https://www.activation-gp.com

Activation Group Holdings Limited, an investment holding company, primarily provides integrated marketing solutions in Mainland China, Hong Kong, and Singapore. It operates through three segments: Experiential Marketing Services, Digital and Communication Services, and IP Development. The company offers integrated marketing solutions, including experiential marketing, digital and brand communication, and public relations services.

Activation Group Holdings Fundamentals Summary

How do Activation Group Holdings's earnings and revenue compare to its market cap?
9919 fundamental statistics
Market Cap	CN¥733.13m
Earnings (TTM)	CN¥92.49m
Revenue (TTM)	CN¥904.06m

7.9x

P/E Ratio

0.8x

P/S Ratio

Is 9919 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
9919 income statement (TTM)
Revenue	CN¥904.06m
Cost of Revenue	CN¥636.77m
Gross Profit	CN¥267.28m
Other Expenses	CN¥174.80m
Earnings	CN¥92.49m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.12
Gross Margin	29.56%
Net Profit Margin	10.23%
Debt/Equity Ratio	0%

How did 9919 perform over the long term?

See historical performance and comparison

Dividends

3.3%

Current Dividend Yield

20%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 9919 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

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 9919?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 9919. This is calculated by dividing 9919's market cap by their current preferred multiple.
What is 9919's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	CN¥733.13m

9919 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	0.4x
Enterprise Value/EBITDA	2.5x
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

How does 9919's PE Ratio compare to its peers?

9919 PE Ratio vs Peers

The above table shows the PE ratio for 9919 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	19.6x
1490 Cheshi Technology	13x	n/a	HK$624.0m
1163 Adtiger Corporations	46.3x	n/a	HK$641.2m
752 Pico Far East Holdings	9.5x	n/a	HK$1.4b
623 SinoMedia Holding	9.4x	n/a	HK$406.2m
9919 Activation Group Holdings	7.9x	n/a	HK$857.8m

Forward PE

Price-To-Earnings vs Peers: 9919 is good value based on its Price-To-Earnings Ratio (7.9x) compared to the peer average (19.6x).

Price to Earnings Ratio vs Industry

How does 9919's PE Ratio compare vs other companies in the Asian Media Industry?

Price-To-Earnings vs Industry: 9919 is good value based on its Price-To-Earnings Ratio (7.9x) compared to the Hong Kong Media industry average (12.7x)

Price to Earnings Ratio vs Fair Ratio

What is 9919'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.

9919 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	7.9x
Fair PE Ratio	n/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate 9919's Price-To-Earnings Fair Ratio for valuation analysis.

Share Price vs Fair Value

What is the Fair Price of 9919 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 9919 (HK$1.15) is trading below our estimate of fair value (HK$11.03)

Significantly Below Fair Value: 9919 is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 9919's PEG Ratio to determine if it is good value.

Discover undervalued companies

Future Growth

How is Activation Group Holdings forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

3/6

Future Growth Score 3/6

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

26.5%

Forecasted annual revenue growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if 9919's forecast earnings growth is above the savings rate (1.5%).

Earnings vs Market: Insufficient data to determine if 9919's earnings are forecast to grow faster than the Hong Kong market

High Growth Earnings: Insufficient data to determine if 9919's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 9919's revenue (26.5% per year) is forecast to grow faster than the Hong Kong market (10.3% per year).

High Growth Revenue: 9919's revenue (26.5% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 9919's Return on Equity is forecast to be high in 3 years time (33.5%)

Discover growth companies

Past Performance

How has Activation Group Holdings performed over the past 5 years?

Past Performance Score

6/6

Past Performance Score 6/6

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

23.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 9919 has high quality earnings.

Growing Profit Margin: 9919's current net profit margins (10.2%) are higher than last year (5.1%).

Past Earnings Growth Analysis

Earnings Trend: 9919's earnings have grown significantly by 23.4% per year over the past 5 years.

Accelerating Growth: 9919's earnings growth over the past year (294.9%) exceeds its 5-year average (23.4% per year).

Earnings vs Industry: 9919 earnings growth over the past year (294.9%) exceeded the Media industry 13.3%.

Return on Equity

High ROE: 9919's Return on Equity (23.9%) is considered high.

Discover strong past performing companies

Financial Health

How is Activation Group Holdings's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

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

Financial Position Analysis

Short Term Liabilities: 9919's short term assets (CN¥670.7M) exceed its short term liabilities (CN¥279.4M).

Long Term Liabilities: 9919's short term assets (CN¥670.7M) exceed its long term liabilities (CN¥7.5M).

Debt to Equity History and Analysis

Debt Level: 9919 is debt free.

Reducing Debt: 9919 has no debt compared to 5 years ago when its debt to equity ratio was 2.4%.

Debt Coverage: 9919 has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 9919 has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

Discover healthy companies

Dividend

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

Dividend Score

3/6

Dividend Score 3/6

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

3.29%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 9919's dividend (3.29%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.7%).

High Dividend: 9919's dividend (3.29%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.69%).

Stability and Growth of Payments

Stable Dividend: Too early to tell whether 9919's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if 9919's dividend payments are increasing as they only just started paying a dividend.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (19.7%), 9919's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (14.1%), 9919's dividend payments are thoroughly covered by cash flows.

Discover strong dividend paying companies

Management

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

2.8yrs

Average board tenure

CEO

Steve Lau (46 yo)

no data

Tenure

Mr. Lau Kam Yiu, also known as Steve, is the Joint-Chairman and Chief Executive Officer of Activation Group Holdings Ltd. and has been its Executive Director since September 16, 2019. Mr. Lau has experienc...

Board Members

Experienced Board: 9919's board of directors are not considered experienced ( 2.8 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.

Data	Last Updated (UTC time)
Company Analysis	2022/06/29 00:00
End of Day Share Price	2022/06/29 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31