Plover Bay Technologies (SEHK:1523) - Share price, News & Analysis

Q: What is the Fair Price of 1523 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

1523 (HK$2.95) is trading below our estimate of [[fair value]] (HK$8.68)

1523 fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	5/6
Past Performance	5/6
Financial Health	5/6
Dividends	2/6

1523 Stock Overview

Plover Bay Technologies Limited, an investment holding company, designs, develops, markets, and sells software defined wide area network routers worldwide.

Rewards

Trading at 66% below our estimate of its fair value

Earnings are forecast to grow 22.76% per year

Earnings grew by 49% over the past year

Risk Analysis

High level of non-cash earnings

Dividend of 4.85% is not well covered by earnings

Plover Bay Technologies Competitors

Hengxin Technology

SEHK:1085

HK$1.4b

Vtech Holdings

SEHK:303

HK$15.6b

Trigiant Group

SEHK:1300

HK$851.0m

Yangtze Optical Fibre And Cable Limited

SEHK:6869

HK$18.4b

Price History & Performance

Summary of all time highs, changes and price drops for Plover Bay Technologies
Historical stock prices
Current Share Price	HK$2.95
52 Week High	HK$4.68
52 Week Low	HK$1.70
Beta	0.81
1 Month Change	-2.64%
3 Month Change	-10.06%
1 Year Change	71.51%
3 Year Change	154.31%
5 Year Change	224.18%
Change since IPO	502.04%

Recent News & Updates

Mar 24

We Think Plover Bay Technologies (HKG:1523) Can Manage Its Debt With Ease

The external fund manager backed by Berkshire Hathaway's Charlie Munger, Li Lu, makes no bones about it when he says...

Mar 04

Why Plover Bay Technologies Limited (HKG:1523) Could Be Worth Watching

Plover Bay Technologies Limited ( HKG:1523 ), might not be a large cap stock, but it saw significant share price...

Shareholder Returns

	1523	HK Communications	HK Market
7D	1.7%	6.5%	1.7%
1Y	71.5%	-39.6%	-21.2%

Return vs Industry: 1523 exceeded the Hong Kong Communications industry which returned -43.7% over the past year.

Return vs Market: 1523 exceeded the Hong Kong Market which returned -23.3% over the past year.

Price Volatility

Is 1523's price volatile compared to industry and market?
1523 volatility
1523 Average Weekly Movement	5.2%
Communications Industry Average Movement	7.2%
Market Average Movement	6.9%
10% most volatile stocks in HK Market	13.8%
10% least volatile stocks in HK Market	3.4%

Stable Share Price: 1523 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: 1523's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2006	190	Kit Wai Chau	https://www.ploverbay.com

Plover Bay Technologies Limited, an investment holding company, designs, develops, markets, and sells software defined wide area network routers worldwide. It also provides software licences, and warranty and support services. The company markets and sells its products under the Peplink and Pepwave brands.

Plover Bay Technologies Fundamentals Summary

How do Plover Bay Technologies's earnings and revenue compare to its market cap?
1523 fundamental statistics
Market Cap	US$410.85m
Earnings (TTM)	US$21.20m
Revenue (TTM)	US$74.13m

19.4x

P/E Ratio

5.5x

P/S Ratio

Is 1523 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
1523 income statement (TTM)
Revenue	US$74.13m
Cost of Revenue	US$30.97m
Gross Profit	US$43.16m
Other Expenses	US$21.96m
Earnings	US$21.20m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.019
Gross Margin	58.22%
Net Profit Margin	28.60%
Debt/Equity Ratio	11.6%

How did 1523 perform over the long term?

See historical performance and comparison

Dividends

4.8%

Current Dividend Yield

89%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 1523 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

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 1523?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 1523. This is calculated by dividing 1523's market cap by their current preferred multiple.
What is 1523's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$410.85m

1523 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	5.2x
Enterprise Value/EBITDA	14.7x
PEG Ratio	0.9x

Price to Earnings Ratio vs Peers

How does 1523's PE Ratio compare to its peers?

1523 PE Ratio vs Peers

The above table shows the PE ratio for 1523 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	10.3x
1085 Hengxin Technology	16.4x	n/a	HK$1.4b
303 Vtech Holdings	11.5x	n/a	HK$15.6b
1300 Trigiant Group	3.5x	n/a	HK$851.0m
6869 Yangtze Optical Fibre And Cable Limited	9.7x	8.4%	HK$18.4b
1523 Plover Bay Technologies	19.4x	22.8%	HK$3.2b

Forward PE

Price-To-Earnings vs Peers: 1523 is expensive based on its Price-To-Earnings Ratio (19.4x) compared to the peer average (10.3x).

Price to Earnings Ratio vs Industry

How does 1523's PE Ratio compare vs other companies in the Asian Communications Industry?

Price-To-Earnings vs Industry: 1523 is expensive based on its Price-To-Earnings Ratio (19.4x) compared to the Hong Kong Communications industry average (11.4x)

Price to Earnings Ratio vs Fair Ratio

What is 1523'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.

1523 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	19.4x
Fair PE Ratio	11.5x

Price-To-Earnings vs Fair Ratio: 1523 is expensive based on its Price-To-Earnings Ratio (19.4x) compared to the estimated Fair Price-To-Earnings Ratio (11.5x).

Share Price vs Fair Value

What is the Fair Price of 1523 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 1523 (HK$2.95) is trading below our estimate of fair value (HK$8.68)

Significantly Below Fair Value: 1523 is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: 1523 is good value based on its PEG Ratio (0.9x)

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Future Growth

How is Plover Bay Technologies forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

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

22.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1523's forecast earnings growth (22.8% per year) is above the savings rate (1.5%).

Earnings vs Market: 1523's earnings (22.8% per year) are forecast to grow faster than the Hong Kong market (16.9% per year).

High Growth Earnings: 1523's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 1523's revenue (19.8% per year) is forecast to grow faster than the Hong Kong market (10.3% per year).

High Growth Revenue: 1523's revenue (19.8% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 1523's Return on Equity is forecast to be very high in 3 years time (74.9%).

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Past Performance

How has Plover Bay Technologies performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

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

22.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 1523 has a high level of non-cash earnings.

Growing Profit Margin: 1523's current net profit margins (28.6%) are higher than last year (26.9%).

Past Earnings Growth Analysis

Earnings Trend: 1523's earnings have grown significantly by 22.6% per year over the past 5 years.

Accelerating Growth: 1523's earnings growth over the past year (49%) exceeds its 5-year average (22.6% per year).

Earnings vs Industry: 1523 earnings growth over the past year (49%) exceeded the Communications industry 23.3%.

Return on Equity

High ROE: 1523's Return on Equity (52.9%) is considered outstanding.

Discover strong past performing companies

Financial Health

How is Plover Bay Technologies's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

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

Financial Position Analysis

Short Term Liabilities: 1523's short term assets ($66.9M) exceed its short term liabilities ($27.4M).

Long Term Liabilities: 1523's short term assets ($66.9M) exceed its long term liabilities ($4.3M).

Debt to Equity History and Analysis

Debt Level: 1523 has more cash than its total debt.

Reducing Debt: 1523's debt to equity ratio has increased from 1.3% to 11.6% over the past 5 years.

Debt Coverage: 1523's debt is well covered by operating cash flow (407.8%).

Interest Coverage: 1523's interest payments on its debt are well covered by EBIT (1304.6x coverage).

Balance Sheet

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Dividend

What is Plover Bay Technologies'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

4.85%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 1523's dividend (4.85%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.75%).

High Dividend: 1523's dividend (4.85%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.9%).

Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, 1523 has been paying a dividend for less than 10 years.

Growing Dividend: 1523's dividend payments have increased, but the company has only paid a dividend for 6 years.

Earnings Payout to Shareholders

Earnings Coverage: At its current payout ratio (88.9%), 1523's payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (114.5%), 1523's dividend payments are not well covered by cash flows.

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Management

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

6.6yrs

Average board tenure

CEO

Kit Wai Chau (47 yo)

6.58yrs

Tenure

US$220,000

Compensation

Mr. Chau Kit Wai has been Chief Executive Officer and Executive Director at Plover Bay Technologies Limited since November 27, 2015 and has been its General Manager since April 2008. Mr. Chau joined Plover...

CEO Compensation Analysis

Compensation vs Market: Kit Wai's total compensation ($USD220.00K) is below average for companies of similar size in the Hong Kong market ($USD393.76K).

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

Board Members

Experienced Board: 1523's board of directors are considered experienced (6.6 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.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/06/27 00:00
End of Day Share Price	2022/06/27 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31