SEHK:66

Stock Analysis Report

Executive Summary

MTR Corporation Limited designs, constructs, operates, maintains, and invests in railways in Hong Kong, Australia, Mainland of China, Sweden, the United Kingdom, and internationally.


Snowflake Analysis

Adequate balance sheet average dividend payer.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 66 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.4%

66

3.1%

HK Transportation

7.4%

HK Market


1 Year Return

-19.2%

66

-22.7%

HK Transportation

-22.7%

HK Market

Return vs Industry: 66 exceeded the Hong Kong Transportation industry which returned -20.9% over the past year.

Return vs Market: 66 exceeded the Hong Kong Market which returned -20.3% over the past year.


Shareholder returns

66IndustryMarket
7 Day3.4%3.1%7.4%
30 Day-9.9%-10.6%-11.2%
90 Day-14.2%-16.1%-17.3%
1 Year-17.2%-19.2%-20.7%-22.7%-19.9%-22.7%
3 Year1.4%-9.9%-10.8%-19.9%-5.3%-14.8%
5 Year32.8%5.2%7.8%-11.1%-8.7%-23.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

20.33x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 66 (HK$39.5) is trading above our estimate of fair value (HK$23.58)

Significantly Below Fair Value: 66 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 66 is poor value based on its PE Ratio (20.3x) compared to the Transportation industry average (15.3x).

PE vs Market: 66 is poor value based on its PE Ratio (20.3x) compared to the Hong Kong market (9x).


Price to Earnings Growth Ratio

PEG Ratio: 66 is poor value based on its PEG Ratio (6x)


Price to Book Ratio

PB vs Industry: 66 is overvalued based on its PB Ratio (1.3x) compared to the HK Transportation industry average (0.9x).


Next Steps

Future Growth

How is MTR forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

3.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 66's forecast earnings growth (3.4% per year) is above the savings rate (1.6%).

Earnings vs Market: 66's earnings (3.4% per year) are forecast to grow slower than the Hong Kong market (12.8% per year).

High Growth Earnings: 66's earnings are forecast to grow, but not significantly.

Revenue vs Market: 66's revenue (4.1% per year) is forecast to grow slower than the Hong Kong market (9.9% per year).

High Growth Revenue: 66's revenue (4.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 66's Return on Equity is forecast to be low in 3 years time (6.4%).


Next Steps

Past Performance

How has MTR performed over the past 5 years?

1.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 66 has high quality earnings.

Growing Profit Margin: 66's current net profit margins (21.9%) are lower than last year (29.7%).


Past Earnings Growth Analysis

Earnings Trend: 66's earnings have grown by 1.4% per year over the past 5 years.

Accelerating Growth: 66's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 66 had negative earnings growth (-25.5%) over the past year, making it difficult to compare to the Transportation industry average (-25.5%).


Return on Equity

High ROE: 66's Return on Equity (6.5%) is considered low.


Next Steps

Financial Health

How is MTR's financial position?


Financial Position Analysis

Short Term Liabilities: 66's short term assets (HK$38.7B) exceed its short term liabilities (HK$15.3B).

Long Term Liabilities: 66's short term assets (HK$38.7B) do not cover its long term liabilities (HK$87.1B).


Debt to Equity History and Analysis

Debt Level: 66's debt to equity ratio (21%) is considered satisfactory.

Reducing Debt: 66's debt to equity ratio has increased from 12.6% to 21% over the past 5 years.

Debt Coverage: 66's debt is well covered by operating cash flow (41.4%).

Interest Coverage: 66's interest payments on its debt are well covered by EBIT (15.4x coverage).


Balance Sheet

Inventory Level: 66 has a high level of physical assets or inventory.

Debt Coverage by Assets: 66's debt is not covered by short term assets (assets are 1x debt).


Next Steps

Dividend

What is MTR's current dividend yield, its reliability and sustainability?

3.11%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: 66's dividend (3.11%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.67%).

High Dividend: 66's dividend (3.11%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.29%).


Stability and Growth of Payments

Stable Dividend: 66's dividend payments have been volatile in the past 10 years.

Growing Dividend: 66's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (63.3%), 66's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 66's dividends in 3 years are forecast to be covered by earnings (50.3% payout ratio).


Next Steps

Management

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

3.7yrs

Average management tenure


CEO

Jacob Kam (57yo)

0.92

Tenure

HK$11,400,000

Compensation

Dr. Chak-pui Kam, also known as Jacob, has been Chief Executive Officer and Director at MTR Corporation Limited since April 1, 2019 and also has been its Member of the Executive Directorate since January 1 ...


CEO Compensation Analysis

Compensation vs Market: Jacob's total compensation ($USD1.47M) is above average for companies of similar size in the Hong Kong market ($USD1.10M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Chak-pui Kam
CEO & Director0.92yrHK$11.40m0.0038% HK$9.5m
Leung-wah Hui
Finance Director3.67yrsHK$7.60m0.00057% HK$1.4m
Tin-shing Lau
MD of Operations & Mainland Businessno dataHK$7.20m0.0013% HK$3.1m
Gillian Meller
Legal & European Business Director and Company Secretary3.67yrsHK$7.00m0.0015% HK$3.7m
Wai-ching Cheng
Human Resources Director3.75yrsHK$7.80m0.00084% HK$2.1m
Mei-chun Yeung
Commercial Director8.5yrsHK$7.70m0.011% HK$26.1m
Chi-fai Tang
Property Director8.42yrsHK$8.00m0.0029% HK$7.1m
Kwok-wah Jim
General Manager of Corporate Financeno datano datano data
Zhe Li
Deputy Director of Strategyno datano datano data
Yiu-Tat Suen
Chief Information Officerno datano datano data

3.7yrs

Average Tenure

54yo

Average Age

Experienced Management: 66's management team is considered experienced (3.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Chak-pui Kam
CEO & Director0.92yrHK$11.40m0.0038% HK$9.5m
Andrew Clifford Winawer Brandler
Independent Non-Executive Director2.83yrsHK$500.00kno data
Yuk-choi Kwan
Independent Non-Executive Director5.42yrsHK$500.00kno data
Ching Fong
Independent Non-Executive Director5.17yrsHK$500.00kno data
Ka-lai Li
Independent Non-Executive Director5.42yrsHK$500.00k0.000060% HK$148.9k
Yuen Tak-fai Chan
Independent Non-Executive Director6.67yrsHK$500.00kno data
Mable Chan
Non-Executive Director2.42yrsHK$400.00kno data
Wong Chan
Independent Non-Executive Director6.67yrsHK$400.00k0.00017% HK$421.9k
Kwok-bun Tang
Independent Non-Executive Director5.42yrsHK$400.00kno data
Pak-kuen Auyeung
Chairman of the Board0.67yrno datano data

5.3yrs

Average Tenure

66.5yo

Average Age

Experienced Board: 66's board of directors are considered experienced (5.3 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

MTR Corporation Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: MTR Corporation Limited
  • Ticker: 66
  • Exchange: SEHK
  • Founded: 1975
  • Industry: Railroads
  • Sector: Transportation
  • Market Cap: HK$248.173b
  • Shares outstanding: 6.16b
  • Website: https://www.mtr.com.hk

Number of Employees


Location

  • MTR Corporation Limited
  • MTR Headquarters Building
  • Telford Plaza
  • Kowloon Bay
  • Kowloon
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
66SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDOct 2000
MTRJ.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDOct 2000
MRIDB (Deutsche Boerse AG)YesOrdinary SharesDEEUROct 2000
66SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesOrdinary SharesHKHKDOct 2000
66SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesOrdinary SharesHKHKDOct 2000
MTCP.YOTCPK (Pink Sheets LLC)UNSPONSORE ADRUSUSDMar 2017

Biography

MTR Corporation Limited designs, constructs, operates, maintains, and invests in railways in Hong Kong, Australia, Mainland of China, Sweden, the United Kingdom, and internationally. It operates in Hong Kong Transport Operations; Hong Kong Station Commercial Businesses; Hong Kong Property Rental and Management Businesses; Hong Kong Property Development; Mainland of China and International Railway, Property Rental and Management Businesses; Mainland Of China Property Development; and Other Businesses. The company offers domestic and cross-boundary services, the Airport Express, and a light rail and bus feeder system. Its network consists of 256.6 kilometers of rail; 12 rail lines; and 93 stations. The company also offers intercity railway services; leases station retail space in stations, as well as advertising space in trains and stations; enables telecommunication services on the railway system; and develops, invests in, manages, and leases investment properties, including shopping malls and offices. In addition, it operates cable cars, and the Octopus access control system; and offers railway consultancy and project management services, as well as railway management, engineering, and technology training services. Further, it administers the operation of MTR academy; and provides general building and maintenance, engineering, property broking and administrative, tourist, fixed telecommunication network and related, insurance, financing, and technical support services. Additionally, the company offers station management, project bidding, commercial management and consultancy, business management and consultancy, commercial facilities strategy, corporate training management, rail transport training, economic and business information consultancy, and enterprise management consultancy. It also engages in the cable car system and theme village; and pre-operation mobilization activities. The company was founded in 1975 and is headquartered in Kowloon Bay, Hong Kong. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/30 12:40
End of Day Share Price2020/03/30 00:00
Earnings2019/12/31
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.