VSTECS Holdings Valuation

Is 856 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of 856 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 856 (HK$5.02) is trading above our estimate of fair value (HK$1.07)

Significantly Below Fair Value: 856 is trading above our estimate of fair value.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 856?

Key metric: As 856 is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for 856. This is calculated by dividing 856's market cap by their current earnings.
What is 856's PE Ratio?
PE Ratio	8.2x
Earnings	HK$873.27m
Market Cap	HK$7.19b

856 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	0.2x
Enterprise Value/EBITDA	8.6x
PEG Ratio	0.5x

Price to Earnings Ratio vs Peers

How does 856's PE Ratio compare to its peers?

The above table shows the PE ratio for 856 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	42.9x
1184 S.A.S. Dragon Holdings	5.5x	n/a	HK$2.6b
400 Ingdan	7.9x	n/a	HK$2.0b
3991 Changhong Jiahua Holdings	4.3x	n/a	HK$1.6b
6036 Apex Ace Holding	153.8x	n/a	HK$653.5m
856 VSTECS Holdings	8.2x	16.5%	HK$7.2b

Price-To-Earnings vs Peers: 856 is good value based on its Price-To-Earnings Ratio (8.2x) compared to the peer average (42.9x).

Price to Earnings Ratio vs Industry

How does 856's PE Ratio compare vs other companies in the HK Electronic Industry?

3 Companies	Price / Earnings	Estimated Growth	Market Cap
76 Elate Holdings	0.6x	n/a	US$18.18m
1822 China Wood International Holding	0.06x	n/a	US$8.98m
911 Qianhai Health Holdings	0.7x	n/a	US$6.86m

No more companies available in this PE range

3 Companies		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: 856 is good value based on its Price-To-Earnings Ratio (8.2x) compared to the Hong Kong Electronic industry average (8.8x).

Price to Earnings Ratio vs Fair Ratio

What is 856'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.

856 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	8.2x
Fair PE Ratio	11.6x

Price-To-Earnings vs Fair Ratio: 856 is good value based on its Price-To-Earnings Ratio (8.2x) compared to the estimated Fair Price-To-Earnings Ratio (11.6x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst 856 forecast and predictions for the stock price in 12 month’s time.
Date	Share Price	Average 1Y Price Target	Dispersion	High	Low	1Y Actual price	Analysts
Current	HK$5.02	HK$5.68 +13.1%	6.0%	HK$6.16	HK$5.40	n/a	3
Nov ’25	HK$4.53	HK$5.44 +20.0%	0.6%	HK$5.47	HK$5.40	n/a	2
Oct ’24	HK$4.40	HK$5.90 +34.1%	1.7%	HK$6.00	HK$5.80	HK$4.68	2
Sep ’24	HK$4.08	HK$5.90 +44.6%	1.7%	HK$6.00	HK$5.80	HK$4.30	2
Aug ’24	HK$3.86	HK$5.90 +52.8%	1.7%	HK$6.00	HK$5.80	HK$4.32	2
Jul ’24	HK$4.03	HK$5.90 +46.4%	1.7%	HK$6.00	HK$5.80	HK$4.43	2
Jun ’24	HK$3.99	HK$5.90 +47.9%	1.7%	HK$6.00	HK$5.80	HK$4.61	2
May ’24	HK$4.50	HK$5.90 +31.1%	1.7%	HK$6.00	HK$5.80	HK$5.00	2
Mar ’24	HK$4.75	HK$8.75 +84.2%	2.9%	HK$9.00	HK$8.50	HK$4.07	2
Feb ’24	HK$4.97	HK$8.75 +76.1%	2.9%	HK$9.00	HK$8.50	HK$4.24	2
Jan ’24	HK$4.50	HK$8.75 +94.4%	2.9%	HK$9.00	HK$8.50	HK$4.40	2
Dec ’23	HK$4.30	HK$8.75 +103.5%	2.9%	HK$9.00	HK$8.50	HK$3.87	2
Nov ’23	HK$3.82	HK$8.75 +129.1%	2.9%	HK$9.00	HK$8.50	HK$4.01	2

Analyst Forecast: Target price is less than 20% higher than the current share price.

Discover undervalued companies

Lenovo Group

HK$114.1b

An investment holding company, develops, manufactures, and markets technology products and services.

80992

HK$8.58

-1.8%

-2.6%

Yangtze Optical Fibre And Cable Limited

HK$16.4b

Engages in the research, development, production, and sale of optical fiber preforms, cables, and related products in the People’s Republic of China and internationally.

6869

HK$11.14

20.4%

BYD Electronic (International)

HK$73.9b

An investment holding company, primarily engages in the design, manufacture, assembly, and sale of mobile handset components, modules, and other products in the People’s Republic of China and internationally.

285

HK$32.80

15.9%

-12.8%