SEHK:398

Stock Analysis Report

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Oriental Watch Holdings

Market Cap

HK$2.2b

Last Updated

2021/06/13 10:06 UTC

Data Sources

Company Financials +

Executive Summary

Oriental Watch Holdings Limited, an investment holding company, trades in watches in Hong Kong, Macau, Taiwan, and the People’s Republic of China. More Details


Snowflake Analysis

Flawless balance sheet second-rate dividend payer.

Share Price & News

How has Oriental Watch Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 398 is not significantly more volatile than the rest of Hong Kong stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: 398's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

14.4%

398

-2.9%

HK Specialty Retail

0.04%

HK Market


1 Year Return

137.2%

398

59.4%

HK Specialty Retail

25.7%

HK Market

Return vs Industry: 398 exceeded the Hong Kong Specialty Retail industry which returned 59.4% over the past year.

Return vs Market: 398 exceeded the Hong Kong Market which returned 25.7% over the past year.


Shareholder returns

398IndustryMarket
7 Day14.4%-2.9%0.04%
30 Day26.7%10.8%4.2%
90 Day66.4%16.3%0.3%
1 Year165.8%137.2%63.7%59.4%30.5%25.7%
3 Year169.4%74.2%60.0%42.8%6.7%-4.6%
5 Year677.1%384.8%184.9%137.2%62.6%34.6%

Long-Term Price Volatility Vs. Market

How volatile is Oriental Watch Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Oriental Watch Holdings undervalued compared to its fair value and its price relative to the market?

4.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 398 (HK$4.46) is trading below our estimate of fair value (HK$4.69)

Significantly Below Fair Value: 398 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: 398 is poor value based on its PE Ratio (26.3x) compared to the Hong Kong Specialty Retail industry average (15.8x).

PE vs Market: 398 is poor value based on its PE Ratio (26.3x) compared to the Hong Kong market (11.7x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 398's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 398 is overvalued based on its PB Ratio (1.2x) compared to the HK Specialty Retail industry average (1x).


Future Growth

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

13.9%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if 398's forecast earnings growth is above the savings rate (1.5%).

Earnings vs Market: Insufficient data to determine if 398's earnings are forecast to grow faster than the Hong Kong market

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

Revenue vs Market: 398's revenue (13.9% per year) is forecast to grow faster than the Hong Kong market (12.7% per year).

High Growth Revenue: 398's revenue (13.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if 398's Return on Equity is forecast to be high in 3 years time


Past Performance

How has Oriental Watch Holdings performed over the past 5 years?

41.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 398 has high quality earnings.

Growing Profit Margin: 398's current net profit margins (3.8%) are lower than last year (5.6%).


Past Earnings Growth Analysis

Earnings Trend: 398 has become profitable over the past 5 years, growing earnings by 41.9% per year.

Accelerating Growth: 398's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 398 had negative earnings growth (-28.7%) over the past year, making it difficult to compare to the Specialty Retail industry average (-7.7%).


Return on Equity

High ROE: 398's Return on Equity (4.6%) is considered low.


Financial Health

How is Oriental Watch Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 398's short term assets (HK$2.0B) exceed its short term liabilities (HK$329.3M).

Long Term Liabilities: 398's short term assets (HK$2.0B) exceed its long term liabilities (HK$327.7M).


Debt to Equity History and Analysis

Debt Level: 398's debt to equity ratio (0.2%) is considered satisfactory.

Reducing Debt: 398's debt to equity ratio has reduced from 12.2% to 0.2% over the past 5 years.

Debt Coverage: 398's debt is well covered by operating cash flow (7774.3%).

Interest Coverage: 398 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


Dividend

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

5.61%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 398's dividend (5.61%) is higher than the bottom 25% of dividend payers in the Hong Kong market (1.86%).

High Dividend: 398's dividend (5.61%) is low compared to the top 25% of dividend payers in the Hong Kong market (5.89%).


Stability and Growth of Payments

Stable Dividend: 398's dividend payments have been volatile in the past 10 years.

Growing Dividend: 398's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (63.7%), 398's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

18.2yrs

Average board tenure


CEO

Dennis Yeung (51 yo)

18.25yrs

Tenure

HK$7,668,000

Compensation

Mr. Him Kit Yeung, also known as Dennis, has been the Managing Director of Oriental Watch Holdings Limited since March 2003 and serves as Chief Executive. Mr. Yeung joined Oriental Watch Holdings Ltd in 19...


CEO Compensation Analysis

Compensation vs Market: Dennis's total compensation ($USD988.09K) is above average for companies of similar size in the Hong Kong market ($USD279.44K).

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


Board Members

Experienced Board: 398's board of directors are seasoned and experienced ( 18.2 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

Oriental Watch Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Oriental Watch Holdings Limited
  • Ticker: 398
  • Exchange: SEHK
  • Founded: 1961
  • Industry: Specialty Stores
  • Sector: Retail
  • Market Cap: HK$2.174b
  • Shares outstanding: 487.36m
  • Website: https://www.orientalwatch.com

Number of Employees


Location

  • Oriental Watch Holdings Limited
  • China Insurance Group Building
  • Room 312-8
  • Central
  • Hong Kong

Listings


Biography

Oriental Watch Holdings Limited, an investment holding company, trades in watches in Hong Kong, Macau, Taiwan, and the People’s Republic of China. It primarily offers various Swiss brands comprising Rolex,...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/06/13 10:06
End of Day Share Price2021/06/11 00:00
Earnings2020/09/30
Annual Earnings2020/03/31


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.