SEHK:1816

Stock Analysis Report

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Executive Summary

CGN Power Co., Ltd. generates and sells nuclear power in the People’s Republic of China.


Snowflake Analysis

Fair value second-rate dividend payer.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 1816 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.8%

1816

5.2%

HK Renewable Energy

5.0%

HK Market


1 Year Return

-20.6%

1816

-25.1%

HK Renewable Energy

-5.3%

HK Market

Return vs Industry: 1816 exceeded the Hong Kong Renewable Energy industry which returned -25.1% over the past year.

Return vs Market: 1816 underperformed the Hong Kong Market which returned -5.3% over the past year.


Shareholder returns

1816IndustryMarket
7 Day-2.8%5.2%5.0%
30 Day-5.5%2.9%4.0%
90 Day-9.9%-5.0%-4.0%
1 Year-16.9%-20.6%-22.1%-25.1%-1.9%-5.3%
3 Year-13.4%-23.5%-33.4%-40.1%-0.5%-10.9%
5 Year-56.3%-63.2%-62.0%-68.2%-9.0%-23.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 1816 (HK$1.73) is trading below our estimate of fair value (HK$6.71)

Significantly Below Fair Value: 1816 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 1816 is poor value based on its PE Ratio (9.1x) compared to the Renewable Energy industry average (7x).

PE vs Market: 1816 is good value based on its PE Ratio (9.1x) compared to the Hong Kong market (9.4x).


Price to Earnings Growth Ratio

PEG Ratio: 1816 is poor value based on its PEG Ratio (1.2x)


Price to Book Ratio

PB vs Industry: 1816 is overvalued based on its PB Ratio (0.9x) compared to the HK Renewable Energy industry average (0.5x).


Next Steps

Future Growth

How is CGN Power forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

7.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1816's forecast earnings growth (7.3% per year) is above the savings rate (1.6%).

Earnings vs Market: 1816's earnings (7.3% per year) are forecast to grow slower than the Hong Kong market (17.1% per year).

High Growth Earnings: 1816's earnings are forecast to grow, but not significantly.

Revenue vs Market: 1816's revenue (0.9% per year) is forecast to grow slower than the Hong Kong market (10.6% per year).

High Growth Revenue: 1816's revenue (0.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1816's Return on Equity is forecast to be low in 3 years time (10.3%).


Next Steps

Past Performance

How has CGN Power performed over the past 5 years?

6.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 1816 has high quality earnings.

Growing Profit Margin: 1816's current net profit margins (13.7%) are lower than last year (16.6%).


Past Earnings Growth Analysis

Earnings Trend: 1816's earnings have grown by 6.1% per year over the past 5 years.

Accelerating Growth: 1816's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 1816 had negative earnings growth (-3%) over the past year, making it difficult to compare to the Renewable Energy industry average (9.7%).


Return on Equity

High ROE: 1816's Return on Equity (9.7%) is considered low.


Next Steps

Financial Health

How is CGN Power's financial position?


Financial Position Analysis

Short Term Liabilities: 1816's short term assets (CN¥61.3B) do not cover its short term liabilities (CN¥66.4B).

Long Term Liabilities: 1816's short term assets (CN¥61.3B) do not cover its long term liabilities (CN¥183.7B).


Debt to Equity History and Analysis

Debt Level: 1816's debt to equity ratio (155.6%) is considered high.

Reducing Debt: 1816's debt to equity ratio has reduced from 169.6% to 155.6% over the past 5 years.

Debt Coverage: 1816's debt is not well covered by operating cash flow (14.2%).

Interest Coverage: 1816's interest payments on its debt are well covered by EBIT (3.1x coverage).


Balance Sheet


Next Steps

Dividend

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

4.79%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 1816's dividend (4.79%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.46%).

High Dividend: 1816's dividend (4.79%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.13%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, 1816 has been paying a dividend for less than 10 years.

Growing Dividend: 1816's dividend payments have increased, but the company has only paid a dividend for 5 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (43.4%), 1816's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 1816's dividends in 3 years are forecast to be well covered by earnings (40.8% payout ratio).


Next Steps

Management

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

2.1yrs

Average management tenure


CEO

Ligang Gao (54yo)

6.25yrs

Tenure

CN¥1,447,450

Compensation

Mr. Ligang Gao has been the President and Executive Director at CGN Power Co., Ltd. since March 2014 and served as its Acting Chairman until May 20, 2020. Mr. Gao served as Senior Vice President at China G ...


CEO Compensation Analysis

Compensation vs Market: Ligang's total compensation ($USD203.59K) is below average for companies of similar size in the Hong Kong market ($USD766.76K).

Compensation vs Earnings: Ligang's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Ligang Gao
President & Executive Director6.25yrsCN¥1.45mno data
Engang Yin
Chief Financial Officer2.67yrsCN¥2.14mno data
Dajin Jiang
VP, Board Secretary & Joint Company Secretary1.58yrsCN¥3.89mno data
Kwok Fai Lee
Joint Company Secretary1.5yrsno datano data

2.1yrs

Average Tenure

54yo

Average Age

Experienced Management: 1816's management team is considered experienced (2.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ligang Gao
President & Executive Director6.25yrsCN¥1.45mno data
Xizhi Na
Independent Non-Executive Director6.25yrsCN¥500.00kno data
Bing Shi
Non-Executive Director6.25yrsno datano data
Wai Keung Siu
Independent Non-Executive Director6.25yrsCN¥650.00kno data
Sui Chen
Chairman of Supervisory Committee3.08yrsno datano data
Yiguang Hu
Independent Non-Executive Director6.25yrsCN¥450.00kno data
Yong Zhang
Non-Executive Director3.08yrsno datano data
Wei Wang
Non-Executive Director0.083yrno datano data
Changli Yang
Non-Executive Chairman0.083yrno datano data

6.3yrs

Average Tenure

54.5yo

Average Age

Experienced Board: 1816's board of directors are considered experienced (6.3 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 been diluted in the past year, with total shares outstanding growing by 11.1%.


Top Shareholders

Company Information

CGN Power Co., Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: CGN Power Co., Ltd.
  • Ticker: 1816
  • Exchange: SEHK
  • Founded: 2014
  • Industry: Independent Power Producers and Energy Traders
  • Sector: Utilities
  • Market Cap: HK$144.515b
  • Shares outstanding: 50.50b
  • Website: https://www.cgnp.com.cn

Number of Employees


Location

  • CGN Power Co., Ltd.
  • CGN Building, South Tower
  • 18th Floor
  • Shenzhen
  • Guangdong Province
  • 518026
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
1816SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDDec 2014
94CDB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEURDec 2014
1816SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDDec 2014
1816SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDDec 2014
CGNW.FOTCPK (Pink Sheets LLC)YesForeign Shares-Foreign ListedUSUSDDec 2014
3816SZSE (Shenzhen Stock Exchange)Domestic SharesCNCNYAug 2019
3816XSEC (Shenzhen Stock Exchange - Shenzhen-Hong Kong Stock Connect)Domestic SharesCNCNYAug 2019

Biography

CGN Power Co., Ltd. generates and sells nuclear power in the People’s Republic of China. As of December 31, 2019, it operated and managed 24 nuclear power generating units with a total installed capacity of 27,142 megawatts. The company is also involved in the development, construction, and operation of offshore power stations; and thermal power development activities. In addition, it engages in the provision of management, technology, and consultancy services, as well as engineering supervision and management, and technical support services; testing and maintenance of power stations; radiation detection and evaluation, and instrument verification; construction design; and import and export trade activities. The company was founded in 2014 and is headquartered in Shenzhen, the People’s Republic of China. CGN Power Co., Ltd. is a subsidiary of China General Nuclear Power Corporation. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/05 13:27
End of Day Share Price2020/06/05 00:00
Earnings2020/03/31
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.