SEHK:2166

Stock Analysis Report

Smart-Core Holdings

Executive Summary

Smart-Core Holdings Limited, an investment holding company, engages in the trading of integrated circuits and other electronic components in the People’s Republic of China.

Rewards

PE ratio (9.8x) is below the Hong Kong market (10.1x)

Earnings grew by 1.3% over the past year

Risk Analysis

Debt is not well covered by operating cash flow

High level of non-cash earnings

Unstable dividend track record

Does not have a meaningful market cap (HK$698M)



Snowflake Analysis

Adequate balance sheet with acceptable track record.

Share Price & News

How has Smart-Core Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 2166 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

4.3%

2166

5.1%

HK Electronic

0.9%

HK Market


1 Year Return

-15.8%

2166

13.9%

HK Electronic

-1.5%

HK Market

Return vs Industry: 2166 underperformed the Hong Kong Electronic industry which returned 13.9% over the past year.

Return vs Market: 2166 underperformed the Hong Kong Market which returned -1.5% over the past year.


Shareholder returns

2166IndustryMarket
7 Day4.3%5.1%0.9%
30 Day8.3%2.1%-3.7%
90 Day12.5%11.1%-0.1%
1 Year-12.4%-15.8%17.4%13.9%2.0%-1.5%
3 Year-16.4%-23.0%15.2%5.8%17.3%5.4%
5 Yearn/a85.9%61.6%17.1%-2.2%

Price Volatility Vs. Market

How volatile is Smart-Core Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Smart-Core Holdings undervalued compared to its fair value and its price relative to the market?

9.85x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 2166 (HK$1.44) is trading above our estimate of fair value (HK$0.76)

Significantly Below Fair Value: 2166 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 2166 is poor value based on its PE Ratio (9.8x) compared to the Electronic industry average (9.1x).

PE vs Market: 2166 is good value based on its PE Ratio (9.8x) compared to the Hong Kong market (10.1x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 2166's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 2166 is overvalued based on its PB Ratio (1.3x) compared to the HK Electronic industry average (0.9x).


Next Steps

Future Growth

How is Smart-Core Holdings forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

24.3%

Forecasted Tech industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Smart-Core Holdings has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Smart-Core Holdings performed over the past 5 years?

8.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 2166 has a high level of non-cash earnings.

Growing Profit Margin: 2166's current net profit margins (1.5%) are higher than last year (1.5%).


Past Earnings Growth Analysis

Earnings Trend: 2166's earnings have grown by 8.8% per year over the past 5 years.

Accelerating Growth: 2166's earnings growth over the past year (1.3%) is below its 5-year average (8.8% per year).

Earnings vs Industry: 2166 earnings growth over the past year (1.3%) exceeded the Electronic industry -8.8%.


Return on Equity

High ROE: 2166's Return on Equity (12.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Smart-Core Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: 2166's short term assets (HK$1.4B) exceed its short term liabilities (HK$918.1M).

Long Term Liabilities: 2166's short term assets (HK$1.4B) exceed its long term liabilities (HK$8.3M).


Debt to Equity History and Analysis

Debt Level: 2166's debt to equity ratio (81.4%) is considered high.

Reducing Debt: 2166's debt to equity ratio has reduced from 86.5% to 81.4% over the past 5 years.

Debt Coverage: 2166's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: 2166's interest payments on its debt are well covered by EBIT (4.5x coverage).


Balance Sheet

Inventory Level: 2166 has a high level of physical assets or inventory.

Debt Coverage by Assets: 2166's debt is covered by short term assets (assets are 2.7x debt).


Next Steps

Dividend

What is Smart-Core Holdings's current dividend yield, its reliability and sustainability?

4.17%

Current Dividend Yield


Dividend Yield vs Market

company4.2%marketbottom25%2.2%markettop25%6.3%industryaverage2.6%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: 2166's dividend (4.17%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.24%).

High Dividend: 2166's dividend (4.17%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.31%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, 2166 has been paying a dividend for less than 10 years.

Growing Dividend: 2166's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (41%), 2166's dividend payments are well 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

What is the CEO of Smart-Core Holdings's salary, the management and board of directors tenure and is there insider trading?

3.8yrs

Average board tenure


CEO

Weidong Tian (53yo)

0yrs

Tenure

HK$1,398,000

Compensation

Mr. Weidong Tian is Founder, Chairman and Chief Executive Officer at Smart-Core Holdings Limited and has been its Executive Director since October 22, 2015. Mr. Tian has been leading Smart-Core for over 10 ...


CEO Compensation Analysis

Compensation vs Market: Weidong's total compensation ($USD178.56K) is about average for companies of similar size in the Hong Kong market ($USD213.05K).

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


Board Age and Tenure

3.8yrs

Average Tenure

53yo

Average Age

Experienced Board: 2166's board of directors are considered experienced (3.8 years average tenure).


Insider Trading

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.


Management Team

  • Weidong Tian (53yo)

    Founder

    • Tenure: 0yrs
    • Compensation: HK$1.40m
  • Tsz Leung Wong (55yo)

    CFO & Executive Director

    • Tenure: 4.2yrs
    • Compensation: HK$1.02m
  • Hongbing Liu (53yo)

    Executive Director

    • Tenure: 4.2yrs
    • Compensation: HK$1.10m
  • Chak Yau (39yo)

    Company Secretary & Financial Controller

    • Tenure: 0.8yrs
  • Yan Qing (49yo)

    Executive Director

    • Tenure: 0.7yrs

Board Members

  • Ming-Je Tang (66yo)

    Independent Non-Executive Director

    • Tenure: 3.8yrs
    • Compensation: HK$280.00k
  • Paul Wong (66yo)

    Independent Non-Executive Director

    • Tenure: 1.4yrs
    • Compensation: HK$140.00k
  • Gang Zheng (52yo)

    Independent Non-Executive Director

    • Tenure: 3.8yrs
    • Compensation: HK$280.00k
  • Weidong Tian (53yo)

    Founder

    • Tenure: 0yrs
    • Compensation: HK$1.40m
  • Tsz Leung Wong (55yo)

    CFO & Executive Director

    • Tenure: 4.2yrs
    • Compensation: HK$1.02m
  • Hongbing Liu (53yo)

    Executive Director

    • Tenure: 4.2yrs
    • Compensation: HK$1.10m
  • Yan Qing (49yo)

    Executive Director

    • Tenure: 0.7yrs

Company Information

Smart-Core Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Smart-Core Holdings Limited
  • Ticker: 2166
  • Exchange: SEHK
  • Founded: 2005
  • Industry: Technology Distributors
  • Sector: Tech
  • Market Cap: HK$698.092m
  • Shares outstanding: 498.64m
  • Website: https://www.smart-core.com.hk

Number of Employees


Location

  • Smart-Core Holdings Limited
  • Tower B
  • 15th Floor
  • Kwai Chung
  • New Territories
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2166SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDOct 2016

Biography

Smart-Core Holdings Limited, an investment holding company, engages in the trading of integrated circuits and other electronic components in the People’s Republic of China. It also provides technical value ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/09 12:50
End of Day Share Price2019/12/09 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.