SEHK:596

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Inspur International

Executive Summary

Inspur International Limited, an investment holding company, provides software development and other software services, and cloud services in the People’s Republic of China. More Details


Snowflake Analysis

Flawless balance sheet and fair value.

Share Price & News

How has Inspur International's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 596 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: 596's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

20.5%

596

4.1%

HK Software

2.2%

HK Market


1 Year Return

-37.9%

596

167.4%

HK Software

7.2%

HK Market

Return vs Industry: 596 underperformed the Hong Kong Software industry which returned 164.3% over the past year.

Return vs Market: 596 underperformed the Hong Kong Market which returned 7.5% over the past year.


Shareholder returns

596IndustryMarket
7 Day20.5%4.1%2.2%
30 Day17.6%17.8%8.4%
90 Day5.3%43.7%15.6%
1 Year-37.9%-37.9%168.6%167.4%11.4%7.2%
3 Year-10.3%-12.3%224.9%221.3%-3.4%-13.5%
5 Year65.3%55.0%366.2%355.5%65.4%37.4%

Long-Term Price Volatility Vs. Market

How volatile is Inspur International's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Inspur International undervalued compared to its fair value and its price relative to the market?

23.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 596 (HK$2) is trading below our estimate of fair value (HK$2.6)

Significantly Below Fair Value: 596 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 596 is poor value based on its PE Ratio (56x) compared to the HK Software industry average (22.2x).

PE vs Market: 596 is poor value based on its PE Ratio (56x) compared to the Hong Kong market (11.5x).


Price to Earnings Growth Ratio

PEG Ratio: 596 is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: 596 is overvalued based on its PB Ratio (1.2x) compared to the HK Software industry average (0.9x).


Next Steps

Future Growth

How is Inspur International forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

71.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 596's forecast earnings growth (71.2% per year) is above the savings rate (1.5%).

Earnings vs Market: 596's earnings (71.2% per year) are forecast to grow faster than the Hong Kong market (21% per year).

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

Revenue vs Market: 596's revenue (10.8% per year) is forecast to grow slower than the Hong Kong market (14.1% per year).

High Growth Revenue: 596's revenue (10.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 596's Return on Equity is forecast to be low in 3 years time (4.2%).


Next Steps

Past Performance

How has Inspur International performed over the past 5 years?

42.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 596 has a large one-off loss of HK$44.3M impacting its June 30 2020 financial results.

Growing Profit Margin: 596's current net profit margins (1.5%) are lower than last year (11.1%).


Past Earnings Growth Analysis

Earnings Trend: 596 has become profitable over the past 5 years, growing earnings by 42.8% per year.

Accelerating Growth: 596's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 596 had negative earnings growth (-86.5%) over the past year, making it difficult to compare to the Software industry average (-7.4%).


Return on Equity

High ROE: 596's Return on Equity (1.3%) is considered low.


Next Steps

Financial Health

How is Inspur International's financial position?


Financial Position Analysis

Short Term Liabilities: 596's short term assets (HK$1.9B) exceed its short term liabilities (HK$1.6B).

Long Term Liabilities: 596's short term assets (HK$1.9B) exceed its long term liabilities (HK$280.5M).


Debt to Equity History and Analysis

Debt Level: 596 is debt free.

Reducing Debt: 596 had no debt 5 years ago.

Debt Coverage: 596 has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 596 has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is Inspur International current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate 596's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate 596's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 596's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 596's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: 596 is not paying a notable dividend for the Hong Kong market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 596's dividend in 3 years as they are not forecast to pay a notable one for the Hong Kong market.


Next Steps

Management

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

5.9yrs

Average management tenure


CEO

Kong Lee Eric (51 yo)

2.42yrs

Tenure

HK$7,796,000

Compensation

Mr. Eric Kong Lee has been President, Chief Operating Officer of Inspur International Limited since August 1, 2017 and served as its Executive Director since August 1, 2017 until December 8, 2020 and its C...


CEO Compensation Analysis

Compensation vs Market: Kong Lee's total compensation ($USD1.01M) is above average for companies of similar size in the Hong Kong market ($USD305.97K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Xingshan Wang
Chairman8.75yrsHK$5.53mno data
Kong Lee Eric
CEO, President & COO2.42yrsHK$7.80mno data
Xiaozhou Jin
Executive Director5.42yrsHK$1.86mno data
Yuxin Zhang
CFO & Executive Director0.083yrno datano data
Hailong Dong
Compliance Officer & Non-Executive Director7.5yrsHK$118.00k0.00035%
HK$ 8.0k
Bo Zou
Joint Secretary9.42yrsno datano data
Wing Chan
Joint Secretary9.42yrsno datano data

5.9yrs

Average Tenure

49yo

Average Age

Experienced Management: 596's management team is seasoned and experienced (5.9 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Xingshan Wang
Chairman8.75yrsHK$5.53mno data
Xiaozhou Jin
Executive Director5.42yrsHK$1.86mno data
Yuxin Zhang
CFO & Executive Director0.083yrno datano data
Hailong Dong
Compliance Officer & Non-Executive Director7.5yrsHK$118.00k0.00035%
HK$ 8.0k
Lit Chor Wong
Independent Non Executive Director17.83yrsHK$247.00kno data
Ruijun Zhang
Independent Non-Executive Director6.75yrsHK$187.00kno data
Xiangqian Ding
Independent Non-Executive Director5.08yrsHK$187.00kno data

6.8yrs

Average Tenure

58yo

Average Age

Experienced Board: 596's board of directors are considered experienced (6.8 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

Inspur International Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Inspur International Limited
  • Ticker: 596
  • Exchange: SEHK
  • Founded: 2003
  • Industry: Application Software
  • Sector: Software
  • Market Cap: HK$2.278b
  • Shares outstanding: 1.14b
  • Website: https://www.inspur.com.hk

Number of Employees


Location

  • Inspur International Limited
  • Tower A, Billion Center
  • Room B&C
  • Kowloon Bay
  • Kowloon
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
596SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDApr 2004
L1CCDB (Deutsche Boerse AG)YesOrdinary SharesDEEURApr 2004
INPR.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDApr 2004

Biography

Inspur International Limited, an investment holding company, provides software development and other software services, and cloud services in the People’s Republic of China. The company operates through Cl...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/01/16 10:33
End of Day Share Price2021/01/15 00:00
Earnings2020/06/30
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.