SEHK:902

Stock Analysis Report

Huaneng Power International

Executive Summary

Huaneng Power International, Inc., through its subsidiaries, generates and sells electricity and heat to the regional or provincial grid companies in the People’s Republic of China, Singapore, and Pakistan.


Snowflake Analysis

Proven track record second-rate dividend payer.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 902 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.1%

902

0.4%

HK Renewable Energy

2.9%

HK Market


1 Year Return

-30.6%

902

-22.1%

HK Renewable Energy

-3.8%

HK Market

Return vs Industry: 902 underperformed the Hong Kong Renewable Energy industry which returned -22.1% over the past year.

Return vs Market: 902 underperformed the Hong Kong Market which returned -3.8% over the past year.


Shareholder returns

902IndustryMarket
7 Day2.1%0.4%2.9%
30 Day-12.2%-6.4%-4.1%
90 Day-8.2%-1.5%2.9%
1 Year-28.9%-30.6%-19.3%-22.1%-0.2%-3.8%
3 Year-27.9%-35.1%-22.6%-29.9%15.3%3.7%
5 Year-51.5%-62.7%-42.5%-51.6%16.8%-2.7%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

10.74x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 902 (HK$3.47) is trading above our estimate of fair value (HK$1.9)

Significantly Below Fair Value: 902 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 902 is poor value based on its PE Ratio (10.7x) compared to the Renewable Energy industry average (8.1x).

PE vs Market: 902 is poor value based on its PE Ratio (10.7x) compared to the Hong Kong market (10.1x).


Price to Earnings Growth Ratio

PEG Ratio: 902 is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: 902 is overvalued based on its PB Ratio (0.5x) compared to the HK Renewable Energy industry average (0.5x).


Next Steps

Future Growth

How is Huaneng Power International forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

14.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 902's forecast earnings growth (14.1% per year) is above the savings rate (1.6%).

Earnings vs Market: 902's earnings (14.1% per year) are forecast to grow faster than the Hong Kong market (11.7% per year).

High Growth Earnings: 902's earnings are forecast to grow, but not significantly.

Revenue vs Market: 902's revenue (0.5% per year) is forecast to grow slower than the Hong Kong market (10.5% per year).

High Growth Revenue: 902's revenue (0.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 902's Return on Equity is forecast to be low in 3 years time (8%).


Next Steps

Past Performance

How has Huaneng Power International performed over the past 5 years?

-39.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 902 has high quality earnings.

Growing Profit Margin: 902's current net profit margins (2.6%) are higher than last year (0.5%).


Past Earnings Growth Analysis

Earnings Trend: 902's earnings have declined by -39.8% per year over the past 5 years.

Accelerating Growth: 902's earnings growth over the past year (430%) exceeds its 5-year average (-39.8% per year).

Earnings vs Industry: 902 earnings growth over the past year (430%) exceeded the Renewable Energy industry 4.6%.


Return on Equity

High ROE: 902's Return on Equity (5.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Huaneng Power International's financial position?


Financial Position Analysis

Short Term Liabilities: 902's short term assets (CN¥60.6B) do not cover its short term liabilities (CN¥142.3B).

Long Term Liabilities: 902's short term assets (CN¥60.6B) do not cover its long term liabilities (CN¥152.5B).


Debt to Equity History and Analysis

Debt Level: 902's debt to equity ratio (227%) is considered high.

Reducing Debt: 902's debt to equity ratio has increased from 190.3% to 227% over the past 5 years.

Debt Coverage: 902's debt is not well covered by operating cash flow (14%).

Interest Coverage: 902's interest payments on its debt are not well covered by EBIT (2x coverage).


Balance Sheet

Inventory Level: 902 has a high level of physical assets or inventory.

Debt Coverage by Assets: 902's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

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

3.21%

Current Dividend Yield


Dividend Yield vs Market

company3.2%marketbottom25%2.2%markettop25%6.3%industryaverage3.9%forecastin3Years10.2%

Current dividend yield vs market & industry

Notable Dividend: 902's dividend (3.21%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.25%).

High Dividend: 902's dividend (3.21%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.33%).


Stability and Growth of Payments

Stable Dividend: 902's dividend payments have been volatile in the past 10 years.

Growing Dividend: 902's dividend payments have not increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (34.4%), 902's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 902's dividends in 3 years are forecast to be covered by earnings (55% payout ratio).


Next Steps

Management

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

1.6yrs

Average management tenure


CEO

Keyu Zhao (53yo)

1.6yrs

Tenure

CN¥409,000

Compensation

Mr. Keyu Zhao has been President of Huaneng Power International, Inc. since July 31, 2018. He has been the Chief of Planning Department of Huaneng Group since December 2009. Mr. Zhao has over 20 years of e ...


Leadership Team

NamePositionTenureCompensationOwnership
Yinbiao Shu
Executive Chairman1.1yrsno datano data
Keyu Zhao
President1.6yrsCN¥409.00kno data
Lixin Huang
Chief Accountant4.1yrsCN¥855.00kno data
Chaoquan Huang
VP, GM of Department of Administration & Company Secretary0yrsCN¥757.00kno data
Wang Yutian
Executive officer0yrsno datano data
Lang Chuan Jin
Executive officer0yrsno datano data

1.6yrs

Average Tenure

57.5yo

Average Age

Experienced Management: 902's management team is not considered experienced ( 1.6 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Yinbiao Shu
Executive Chairman1.1yrsno datano data
Jian Huang
Non-Executive Director11.5yrsno datano data
Xianzhi Zhang
Independent Non-Executive Director2.7yrsCN¥74.00kno data
Xiangdong Ye
Chairman of the Supervisory Committee5.4yrsno datano data
Hongbo Guo
Non-Executive Director8yrsno datano data
Dabin Mi
Non-Executive Director5.4yrsno datano data
Heng Yue
Independent Non-Executive Director5.4yrsCN¥74.00kno data
Xuan Mu
Vice Chairman of the Supervisory Committee5.4yrsCN¥65.00kno data
Mengzhou Xu
Independent Non-executive Director3.7yrsCN¥74.00kno data
Jizhen Liu
Independent Non-Executive Director2.7yrsCN¥74.00kno data

5.4yrs

Average Tenure

54.5yo

Average Age

Experienced Board: 902's board of directors are considered experienced (5.4 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

Huaneng Power International, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Huaneng Power International, Inc.
  • Ticker: 902
  • Exchange: SEHK
  • Founded: 1994
  • Industry: Independent Power Producers and Energy Traders
  • Sector: Utilities
  • Market Cap: HK$76.641b
  • Shares outstanding: 15.70b
  • Website: https://www.hpi.com.cn

Number of Employees


Location

  • Huaneng Power International, Inc.
  • Huaneng Building
  • 6 Fuxingmennei Street
  • Beijing
  • 100031
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HNPNYSE (New York Stock Exchange)ADR EACH REP 40 'H' SHS CNY1USUSDOct 1994
HUPDB (Deutsche Boerse AG)ADR EACH REP 40 'H' SHS CNY1DEEUROct 1994
K3FDSGX (Singapore Exchange)ADR EACH REP 40 'H' SHS CNY1SGUSDOct 1994
HUNG.FOTCPK (Pink Sheets LLC)YesForeign Shares-Foreign ListedUSUSDJan 1998
HUP1DB (Deutsche Boerse AG)YesForeign Shares-Foreign ListedDEEURJan 1998
902SEHK (The Stock Exchange of Hong Kong Ltd.)YesForeign Shares-Foreign ListedHKHKDJan 1998
902SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDJan 1998
902SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesForeign Shares-Foreign ListedHKHKDJan 1998
600011SHSE (Shanghai Stock Exchange)Domestic SharesCNCNYDec 2001
600011XSSC (Shanghai Stock Exchange - Shanghai - Hong Kong Stock Connect)Domestic SharesCNCNYDec 2001

Biography

Huaneng Power International, Inc., through its subsidiaries, generates and sells electricity and heat to the regional or provincial grid companies in the People’s Republic of China, Singapore, and Pakistan. It is involved in the development, investment, construction, operation, and management of power plants and related projects; and generation, wholesale, and retail of power and other relating utilities. The company generates power from coal, wind, gas, oil, biomass, solar, and hydro resources. It is also involved in the sale of coal ash and lime; provision of loading, warehousing, and conveying services; photovoltaic power generation projects development and construction; and provision of thermal energy and cold energy services, as well as thermal heating services. In addition, the company engages in the repair of power equipment; provision of water supply and transportation services; construction and operation of electricity distribution networks and heating pipe networks; power supply, energy transmission, and substation project contracting activities; cargo transportation along domestic coastal areas; port management, investment, and development activities; and port provision, and cargo loading and storage activities. Further, it is involved in the management of industrial water and waste, as well as provides environment engineering, and information technology and management consulting services. Additionally, it sells raw and processed coal; and provides central heat, and plumbing and pipe installation services, as well as desalinated water. As of April 25, 2019, the company had controlled generating capacity of 105,973 megawatts and a total generating capacity of 93,225 megawatts. Huaneng Power International, Inc. was founded in 1994 and is headquartered in Beijing, the People’s Republic of China. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 12:40
End of Day Share Price2020/02/18 00:00
Earnings2019/09/30
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.