SEHK:6839

Stock Analysis Report

Yunnan Water Investment

Executive Summary

Yunnan Water Investment Co., Limited, an investment holding company, designs, develops, constructs, operates, and maintains municipal water supply and wastewater treatment facilities in the People’s Republic of China and internationally.

Snowflake

Fundamentals

Undervalued second-rate dividend payer.

Risks

  • Yunnan Water Investment is not covered by any analysts.

Similar Companies

Share Price & News

How has Yunnan Water Investment's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

3.8%

SEHK:6839

1.9%

HK Water Utilities

3.3%

HK Market


1 Year Return

-20.6%

SEHK:6839

10.3%

HK Water Utilities

-10.5%

HK Market

6839 underperformed the Water Utilities industry which returned 10.3% over the past year.

6839 underperformed the Market in Hong Kong which returned -9.5% over the past year.


Share holder returns

6839IndustryMarket
7 Day3.8%1.9%3.3%
30 Day-10.0%-2.5%-8.0%
90 Day-14.1%6.7%-5.9%
1 Year-14.2%-20.6%14.4%10.3%-7.2%-10.5%
3 Year-50.5%-58.0%23.7%11.8%15.1%3.7%
5 Yearn/a43.6%25.4%9.0%-9.0%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Yunnan Water Investment undervalued based on future cash flows and its price relative to the stock market?

46%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Yunnan Water Investment's share price is below the future cash flow value, and at a moderate discount (> 20%).

Yunnan Water Investment's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

Yunnan Water Investment is good value based on earnings compared to the HK Water Utilities industry average.

Yunnan Water Investment is good value based on earnings compared to the Hong Kong market.


Price Based on Expected Growth

Unable to calculate PEG ratio for Yunnan Water Investment, we can't assess if its growth is good value.


Price Based on Value of Assets

Yunnan Water Investment is good value based on assets compared to the HK Water Utilities industry average.


Next Steps

Future Growth

How is Yunnan Water Investment expected to perform in the next 1 to 3 years based on estimates from 0 analysts?

10.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Unable to determine if Yunnan Water Investment is high growth as no revenue estimate data is available.

Yunnan Water Investment's earnings are expected to grow by 10.7% yearly, however this is not considered high growth (20% yearly).

Unable to compare Yunnan Water Investment's revenue growth to the Hong Kong market average as no estimate data is available.

Yunnan Water Investment's earnings growth is positive but not above the Hong Kong market average.

Yunnan Water Investment's earnings growth is expected to exceed the low risk savings rate of 2%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if Yunnan Water Investment will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has Yunnan Water Investment performed over the past 5 years?

18.0%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Yunnan Water Investment's year on year earnings growth rate has been positive over the past 5 years.

Yunnan Water Investment's 1-year earnings growth is less than its 5-year average (10.9% vs 18%)

Yunnan Water Investment's earnings growth has not exceeded the HK Water Utilities industry average in the past year (10.9% vs 16.5%).


Return on Equity

Yunnan Water Investment has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Yunnan Water Investment used its assets less efficiently than the HK Water Utilities industry average last year based on Return on Assets.


Return on Capital Employed

Yunnan Water Investment's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Yunnan Water Investment's financial position?


Financial Position Analysis

Yunnan Water Investment is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Yunnan Water Investment's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

Yunnan Water Investment's level of debt (194.1%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (41% vs 194.1% today).

Operating cash flow is negative therefore debt is not well covered.

Interest payments on debt are not well covered by earnings (EBIT is 1.8x annual interest expense, ideally 3x coverage).


Balance Sheet

Low level of unsold assets.

Debt is not covered by short term assets, assets are 0.8x debt.


Next Steps

Dividend

What is Yunnan Water Investment's current dividend yield, its reliability and sustainability?

8.83%

Current Dividend Yield


Dividend Yield and Payments Analysis

Yunnan Water Investment's pays a higher dividend yield than the bottom 25% of dividend payers in Hong Kong (2.27%).

Yunnan Water Investment's dividend is above the markets top 25% of dividend payers in Hong Kong (6.19%).

Whilst dividend payments have been stable, Yunnan Water Investment has been paying a dividend for less than 10 years.

Dividend payments have increased, but Yunnan Water Investment only paid a dividend in the past 3 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (2.5x coverage).


Future Payout to Shareholders

Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.


Next Steps

  • Explore strong dividend paying companies in the Utilities industry.

Management

What is the CEO of Yunnan Water Investment's salary, the management and board of directors tenure and is there insider trading?

7.7yrs

Average management tenure


CEO

Long Yu (47yo)

8.2yrs

Tenure

CN¥3,145,000

Compensation

Mr. Long Yu has been the Chief Executive Officer of Yunnan Water Investment Co., Limited since June 21, 2011. Mr. Yu has been Vice Chairman of the Board at Yunnan Water Investment Co., Limited since Decemb ...


CEO Compensation Analysis

Long's remuneration is higher than average for companies of similar size in Hong Kong.

Long's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

7.7yrs

Average Tenure

47yo

Average Age

The average tenure for the Yunnan Water Investment management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

2.0yrs

Average Tenure

47yo

Average Age

The average tenure for the Yunnan Water Investment board of directors is less than 3 years, this suggests a new board.


Insider Trading

No 3 month open market individual insider trading information.


Ownership Breakdown


Management Team

  • Bo Li (40yo)

    Company Secretary

    • Tenure: 6.3yrs
  • Long Yu (47yo)

    CEO & Vice Chairman

    • Tenure: 8.2yrs
    • Compensation: CN¥3.15m
  • Fang Yang (45yo)

    Deputy CEO & Executive Director

    • Tenure: 2.0yrs
    • Compensation: CN¥1.87m
  • Yong Wang (47yo)

    Chief Financial Controller

    • Tenure: 5.8yrs
  • Xujun Liu (46yo)

    Deputy Chief Executive Officer

    • Tenure: 7.7yrs
    • Compensation: CN¥1.73m
  • Shake Hu (62yo)

    Deputy Chief Executive Officer

    • Tenure: 7.7yrs
  • Yunjian Huang (53yo)

    Deputy Chief Executive Officer

    • Tenure: 7.7yrs
    • Compensation: CN¥2.10m
  • Xiangyi Ma

    Deputy Chief Executive Officer

    • Tenure: 0.0yrs
  • Peng Zhao

    Deputy Chief Executive Officer

    • Tenure: 0.0yrs
  • Song Zhang

    Deputy Chief Executive Officer

    • Tenure: 0.0yrs

Board Members

  • Shuen Kong Liu (47yo)

    Independent Non-Executive Director

    • Tenure: 1.2yrs
    • Compensation: CN¥108.00k
  • Yuanping He (53yo)

    Non-Executive Director

    • Tenure: 8.2yrs
  • Long Yu (47yo)

    CEO & Vice Chairman

    • Tenure: 8.2yrs
    • Compensation: CN¥3.15m
  • Fang Yang (45yo)

    Deputy CEO & Executive Director

    • Tenure: 2.0yrs
    • Compensation: CN¥1.87m
  • Bo Li (42yo)

    Non-Executive Director

    • Tenure: 2.0yrs
  • Song Hu (57yo)

    Independent Non-Executive Director

    • Tenure: 5.0yrs
    • Compensation: CN¥100.00k
  • Shihao Ma (80yo)

    Independent Non-Executive Director

    • Tenure: 5.0yrs
    • Compensation: CN¥100.00k
  • Hairui Tan (48yo)

    Independent Supervisor

    • Tenure: 4.6yrs
  • Tao Yang (43yo)

    Chairman

    • Tenure: 2.0yrs
  • Yong Chen (46yo)

    Non-Executive Director

    • Tenure: 0.2yrs

Company Information

Yunnan Water Investment Co., Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Yunnan Water Investment Co., Limited
  • Ticker: 6839
  • Exchange: SEHK
  • Founded: 2009
  • Industry: Water Utilities
  • Sector: Utilities
  • Market Cap: HK$2.267b
  • Shares outstanding: 1.19b
  • Website: https://www.yunnanwater.cn

Number of Employees


Location

  • Yunnan Water Investment Co., Limited
  • Yunnan Water
  • 2089 Haiyuan Bei Road
  • Kunming
  • Yunnan Province
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
6839SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDMay 2015
2WIDB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEURMay 2015

Biography

Yunnan Water Investment Co., Limited, an investment holding company, designs, develops, constructs, operates, and maintains municipal water supply and wastewater treatment facilities in the People’s Republ ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/20 12:51
End of Day Share Price2019/08/20 00:00
Earnings2019/03/31
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.