SEHK:1268

Stock Analysis Report

China MeiDong Auto Holdings

Executive Summary

China MeiDong Auto Holdings Limited, an investment holding company, operates as an automobile dealer in the People’s Republic of China.


Snowflake Analysis

Outstanding track record with high growth potential.

Share Price & News

How has China MeiDong Auto Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 1268's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

27.4%

1268

-1.5%

HK Specialty Retail

-0.4%

HK Market


1 Year Return

223.7%

1268

-21.7%

HK Specialty Retail

-22.7%

HK Market

Return vs Industry: 1268 exceeded the Hong Kong Specialty Retail industry which returned -20.5% over the past year.

Return vs Market: 1268 exceeded the Hong Kong Market which returned -20.4% over the past year.


Shareholder returns

1268IndustryMarket
7 Day27.4%-1.5%-0.4%
30 Day19.7%-14.5%-11.2%
90 Day28.6%-20.4%-17.3%
1 Year233.1%223.7%-17.9%-21.7%-19.9%-22.7%
3 Year773.2%667.0%-10.2%-20.7%-4.8%-14.4%
5 Year943.1%749.1%-12.8%-29.3%-12.3%-26.3%

Price Volatility Vs. Market

How volatile is China MeiDong Auto Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is China MeiDong Auto Holdings undervalued compared to its fair value and its price relative to the market?

35.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 1268 (HK$13.5) is trading below our estimate of fair value (HK$20.81)

Significantly Below Fair Value: 1268 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 1268 is poor value based on its PE Ratio (25.9x) compared to the Specialty Retail industry average (9.1x).

PE vs Market: 1268 is poor value based on its PE Ratio (25.9x) compared to the Hong Kong market (9.1x).


Price to Earnings Growth Ratio

PEG Ratio: 1268 is poor value based on its PEG Ratio (1x)


Price to Book Ratio

PB vs Industry: 1268 is overvalued based on its PB Ratio (8.3x) compared to the HK Specialty Retail industry average (0.8x).


Next Steps

Future Growth

How is China MeiDong Auto Holdings forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

25.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1268's forecast earnings growth (25.3% per year) is above the savings rate (1.6%).

Earnings vs Market: 1268's earnings (25.3% per year) are forecast to grow faster than the Hong Kong market (11.8% per year).

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

Revenue vs Market: 1268's revenue (17.6% per year) is forecast to grow faster than the Hong Kong market (10.2% per year).

High Growth Revenue: 1268's revenue (17.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1268's Return on Equity is forecast to be very high in 3 years time (46.2%).


Next Steps

Past Performance

How has China MeiDong Auto Holdings performed over the past 5 years?

37.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 1268 has high quality earnings.

Growing Profit Margin: 1268's current net profit margins (3.4%) are higher than last year (3.3%).


Past Earnings Growth Analysis

Earnings Trend: 1268's earnings have grown significantly by 37.1% per year over the past 5 years.

Accelerating Growth: 1268's earnings growth over the past year (51.8%) exceeds its 5-year average (37.1% per year).

Earnings vs Industry: 1268 earnings growth over the past year (51.8%) exceeded the Specialty Retail industry -13.3%.


Return on Equity

High ROE: 1268's Return on Equity (31.5%) is considered high.


Next Steps

Financial Health

How is China MeiDong Auto Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 1268's short term assets (CN¥3.8B) exceed its short term liabilities (CN¥3.2B).

Long Term Liabilities: 1268's short term assets (CN¥3.8B) exceed its long term liabilities (CN¥975.4M).


Debt to Equity History and Analysis

Debt Level: 1268's debt to equity ratio (62.8%) is considered high.

Reducing Debt: 1268's debt to equity ratio has reduced from 128.8% to 62.8% over the past 5 years.

Debt Coverage: 1268's debt is well covered by operating cash flow (83.7%).

Interest Coverage: 1268's interest payments on its debt are well covered by EBIT (7.3x coverage).


Balance Sheet

Inventory Level: 1268 has a high level of physical assets or inventory.

Debt Coverage by Assets: 1268's debt is covered by short term assets (assets are 3.4x debt).


Next Steps

Dividend

What is China MeiDong Auto Holdings's current dividend yield, its reliability and sustainability?

2.12%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: 1268's dividend (2.12%) isn’t notable compared to the bottom 25% of dividend payers in the Hong Kong market (2.56%).

High Dividend: 1268's dividend (2.12%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.14%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, 1268 has been paying a dividend for less than 10 years.

Growing Dividend: 1268's dividend payments have increased, but the company has only paid a dividend for 6 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (54.7%), 1268's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 1268's dividends in 3 years are forecast to be well covered by earnings (46.4% payout ratio).


Next Steps

Management

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

4.8yrs

Average board tenure


CEO

Tao Ye (52yo)

no data

Tenure

CN¥5,459,000

Compensation

Mr. Tao Ye serves as the Chief Executive Officer of China MeiDong Auto Holdings Limited. Mr. Ye is responsible for overseeing the daily operations and management of the Group, planning its business and mar ...


CEO Compensation Analysis

Compensation vs Market: Tao's total compensation ($USD770.83K) is above average for companies of similar size in the Hong Kong market ($USD502.67K).

Compensation vs Earnings: Tao's compensation has increased by more than 20% in the past year.


Board Members

NamePositionTenureCompensationOwnership
Fan Ye
Founder and Chairmanno dataCN¥3.11m65.02% CN¥10.2b
Tao Ye
CEO & Executive Directorno dataCN¥5.46mno data
Liuyu Luo
VP of Human Resources & Administration and Executive Director1.08yrsno data0.0041% CN¥648.5k
Ki Chi Jip
Independent Non-Executive Director6.42yrsCN¥139.00k0.013% CN¥2.0m
Chou Wang
Independent Non-Executive Director4.83yrsCN¥84.00kno data
Guiyi Chen
Independent Non-Executive Director3yrsCN¥84.00kno data

4.8yrs

Average Tenure

48yo

Average Age

Experienced Board: 1268's board of directors are considered experienced (4.8 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.


Top Shareholders

Company Information

China MeiDong Auto Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: China MeiDong Auto Holdings Limited
  • Ticker: 1268
  • Exchange: SEHK
  • Founded: 2004
  • Industry: Automotive Retail
  • Sector: Retail
  • Market Cap: HK$15.663b
  • Shares outstanding: 1.16b
  • Website: https://www.meidongauto.com

Number of Employees


Location

  • China MeiDong Auto Holdings Limited
  • Unit A1, Tian An Tech Industry Building
  • 13th Floor
  • Dongguan
  • Guangdong Province
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
1268SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDDec 2013
55MBST (Boerse-Stuttgart)YesOrdinary SharesDEEURDec 2013
1268SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesOrdinary SharesHKCNYDec 2013

Biography

China MeiDong Auto Holdings Limited, an investment holding company, operates as an automobile dealer in the People’s Republic of China. The company is involved in the sale of new passenger cars and spare parts; and the provision of service and survey. It also provides after-sales services, such as auto registration, insurance, auto financing mortgage, auto parts, repair and replacement, sales and maintenance of automotive supplies, etc. In addition, the company engages in the trading of used vehicle and finance leasing activities. Its dealership stores cover various automobile brands comprising BMW, Lexus, Toyota, Hyundai, and Porsche. As of December 31, 2018, it operated 49 4S dealership stores in Guangdong, Hunan, Hubei, Fujian, Jiangxi, Anhui, Beijing, Hebei, and Gansu. The company was founded in 2004 and is headquartered in Dongguan, the People’s Republic of China. China MeiDong Auto Holdings Limited is a subsidiary of Apex Sail Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 14:12
End of Day Share Price2020/04/01 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.