Discounted Cash Flow Calculation for SEHK:1268 using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
China MeiDong Auto Holdings
is arrived at by discounting future cash flows to their present value using the 2 stage method.
We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.
SEHK:1268 DCF 1st Stage: Next 10 year cash flow forecast
Amount off the current price
China MeiDong Auto Holdings
is available for.
Share price is
vs Future cash flow value of
Current Discount Checks
China MeiDong Auto Holdings
to be considered undervalued it must be available for at least 20% below the
current price. Less than 40% is even better.
China MeiDong Auto Holdings's share price is below the future cash flow value, and at a moderate discount (> 20%).
China MeiDong Auto Holdings's share price is below the future cash flow value, and at a substantial discount (> 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
China MeiDong Auto Holdings's
is considered below, and whether this is a fair price.
Price based on past earnings
China MeiDong Auto Holdings's earnings available for a low price, and how does
this compare to other companies in the same industry?
China MeiDong Auto Holdings's earnings are expected to grow significantly at over 20% yearly.
China MeiDong Auto Holdings's revenue is expected to grow significantly at over 20% yearly.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
China MeiDong Auto Holdings's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
China MeiDong Auto Holdings
has a total score of
6/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
A company's financial position is much like your own financial position,
it includes everything you own
The boxes below represent the relative size of what makes up
China MeiDong Auto Holdings's finances.
The net worth of a company is the difference between its assets and liabilities.
China MeiDong Auto Holdings is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
China MeiDong Auto Holdings's cash and other short term assets cover its long term commitments.
This treemap shows a more detailed breakdown of
China MeiDong Auto Holdings's finances. If any of them are yellow this
indicates they may be out of proportion and red means they relate to one of the
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
High level of physical assets or inventory.
Debt is covered by short term assets, assets are 2.5x debt.
Nearly all companies have debt. Debt in itself isn’t
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.
The graphic below shows equity (available funds) and debt, we ideally want to
see the red area (debt) decreasing.
If there is any debt we look at the companies capability to repay it, and
whether the level has increased over the past 5 years.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
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 marketing strategies and supervising investor relationship. He served as General Manager of Asian Operations of EMC Document Sciences Corp, since July 2004. He served as Chief Executive of Objective Software Solutions (Beijing). He has been Executive Director at China MeiDong Auto Holdings Limited since November 24, 2012. Mr. Ye graduated from Massachusetts Institute of Technology with a Master of Science degree in Management and a Master of Science degree in Mechanical Engineering. He holds an MBA from the MIT Sloan School of Business and a M.S. in Materials Science from the University of California Santa Barbara and a B.S. in Mathematical Mechanics from Peking (Beijing) University.
Tao's compensation has been consistent with company performance over the past year.
Tao's remuneration is lower than average for companies of similar size in Hong Kong.
Founder and Chairman
Chief Executive Officer and Executive Director
Chief Financial Officer and Executive Director
Vice President of Human Resources and Administration
Vice President of Sales and Marketing
Board of Directors Tenure
Average tenure and age of the
China MeiDong Auto Holdings
board of directors in years:
The tenure for the China MeiDong Auto Holdings board of directors is about average.
Announcing: China MeiDong Auto Holdings (HKG:1268) Stock Soared An Exciting 314% In The Last Three Years
One bright shining star stock has been China MeiDong Auto Holdings Limited (HKG:1268), which is 314% higher than three years ago. … One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price. … China MeiDong Auto Holdings was able to grow its EPS at 49% per year over three years, sending the share price higher.
Brief Commentary On China MeiDong Auto Holdings Limited's (HKG:1268) Fundamentals
China MeiDong Auto Holdings Limited (HKG:1268) is a stock with outstanding fundamental characteristics. … When we build an investment case, we need to look at the stock with a holistic perspective. … In the case of 1268, it
Is China MeiDong Auto Holdings Limited (HKG:1268) Undervalued After Accounting For Its Future Growth?
Growth expectations for China MeiDong Auto Holdings Limited (HKG:1268) are high, but many investors are starting to ask whether its last close at HK$3.35 can still be rationalized by the future potential. … How is China MeiDong Auto Holdings going to perform in the future. … One reason why investors are attracted to 1268 is the high growth potential in the near future
Is China MeiDong Auto Holdings Limited (HKG:1268) A Great Dividend Stock?
Historically, China MeiDong Auto Holdings Limited (HKG:1268) has been paying a dividend to shareholders. … Let's dig deeper into whether China MeiDong Auto Holdings should have a place in your portfolio. … Check out our latest analysis for China MeiDong Auto Holdings
Does China MeiDong Auto Holdings Limited (HKG:1268) Have A Particularly Volatile Share Price?
Volatility is considered to be a measure of risk in modern finance theory. … Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). … Any stock with a beta of greater than one is considered more volatile than the market, while those with a beta below one are either less volatile or poorly correlated with the market.
Is There An Opportunity With China MeiDong Auto Holdings Limited's (HKG:1268) 31.78% Undervaluation?
by taking the expected future cash flows and discounting them to today's value. … Discounted Cash Flows (DCF). … Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model
Is China MeiDong Auto Holdings Limited's (HKG:1268) 26% Better Than Average?
We'll use ROE to examine China MeiDong Auto Holdings Limited (HKG:1268), by way of a worked example. … China MeiDong Auto Holdings has a ROE of 26%, based on the last twelve months. … View our latest analysis for China MeiDong Auto Holdings?
When Should You Buy China MeiDong Auto Holdings Limited (HKG:1268)?
China MeiDong Auto Holdings Limited (HKG:1268), which is in the specialty retail business, and is based in China,. … A question to answer is whether China MeiDong Auto Holdings's current trading price of HK$2.85 reflective of the actual value of the? … Let’s take a look at China MeiDong Auto Holdings’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change
China MeiDong Auto Holdings Limited (HKG:1268): Time For A Financial Health Check
China MeiDong Auto Holdings Limited (HKG:1268) is a small-cap stock with a market capitalization of HK$3.4b. … While investors primarily focus on the growth potential and competitive landscape of the small-cap companies, they end up ignoring a key aspect, which could be the biggest threat to its existence: its financial health. … So, understanding the company's financial health becomes
Do Insiders Own Lots Of Shares In China MeiDong Auto Holdings Limited (HKG:1268)?
If you want to know who really controls China MeiDong Auto Holdings Limited (HKG:1268), then you'll have to look at the makeup of its share registry. … China MeiDong Auto Holdings is not a large company by global standards. … See our latest analysis for China MeiDong Auto Holdings
China MeiDong Auto Holdings Limited, an investment holding company, operates as an automobile dealer in Mainland China. The company is involved in the sale of new passenger cars and spare parts; and trading of used vehicles. It also provides after-sales services, such as auto registration, insurance, auto financing mortgage, auto parts, repair and replacement, and sales and maintenance of automotive supplies, etc. In addition, the company engages in the finance leasing activity. Its dealership stores cover various automobile brands comprising BMW, Lexus, Toyota, Hyundai, and Porsche. It operates 39 4S dealership stores. The company was founded in 2003 and is headquartered in Dongguan, the People’s Republic of China. China MeiDong Auto Holdings Limited is a subsidiary of Apex Sail Limited.
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