Hong Leong Asia Valuation
Is H22 undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score
4/6Valuation Score 4/6
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 H22 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: H22 (SGD0.82) is trading below our estimate of fair value (SGD1.84)
Significantly Below Fair Value: H22 is trading below fair value by more than 20%.
Key Valuation Metric
Which metric is best to use when looking at relative valuation for H22?
Key metric: As H22 is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.
| What is H22's PE Ratio? | |
|---|---|
| PE Ratio | 7.3x |
| Earnings | S$83.55m |
| Market Cap | S$609.60m |
| Key Statistics | |
|---|---|
| Enterprise Value/Revenue | 0.4x |
| Enterprise Value/EBITDA | 7.4x |
| PEG Ratio | 1.2x |
Price to Earnings Ratio vs Peers
How does H22's PE Ratio compare to its peers?
| Company | Forward PE | Estimated Growth | Market Cap |
|---|---|---|---|
| Peer Average | 5.7x | ||
BTM Penguin International | 11x | n/a | S$189.3m |
1MZ Nam Cheong | 0.7x | n/a | S$141.2m |
G50 Grand Banks Yachts | 4.8x | n/a | S$104.5m |
BKX Yongmao Holdings | 6.2x | n/a | S$49.7m |
H22 Hong Leong Asia | 7.3x | 5.9% | S$609.6m |
Price-To-Earnings vs Peers: H22 is expensive based on its Price-To-Earnings Ratio (7.3x) compared to the peer average (5.7x).
Price to Earnings Ratio vs Industry
How does H22's PE Ratio compare vs other companies in the Asian Machinery Industry?
| 20 Companies | Price / Earnings | Estimated Growth | Market Cap |
|---|---|---|---|
| 20 Companies | Estimated Growth | Market Cap | |
|---|---|---|---|
Price-To-Earnings vs Industry: H22 is good value based on its Price-To-Earnings Ratio (7.3x) compared to the Asian Machinery industry average (22.9x).
Price to Earnings Ratio vs Fair Ratio
What is H22'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.
| Fair Ratio | |
|---|---|
| Current PE Ratio | 7.3x |
| Fair PE Ratio | 9.6x |
Price-To-Earnings vs Fair Ratio: H22 is good value based on its Price-To-Earnings Ratio (7.3x) compared to the estimated Fair Price-To-Earnings Ratio (9.6x).
Analyst Price Targets
What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?
Analyst Forecast: Target price is more than 20% higher than the current share price, but there are not enough analysts covering the stock to determine statistical confidence in agreement.
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