SGX:S41

Stock Analysis Report

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Executive Summary

Hong Leong Finance Limited provides various financial services for business enterprises and retail customers in Singapore. More Details


Snowflake Analysis

Excellent balance sheet, good value and pays a dividend.

Share Price & News

How has Hong Leong Finance's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: S41 is less volatile than 75% of SG stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: S41's weekly volatility (2%) has been stable over the past year.


Market Performance


7 Day Return

-0.4%

S41

1.6%

SG Consumer Finance

-0.2%

SG Market


1 Year Return

-8.0%

S41

4.4%

SG Consumer Finance

-10.2%

SG Market

Return vs Industry: S41 underperformed the SG Consumer Finance industry which returned 4.4% over the past year.

Return vs Market: S41 exceeded the SG Market which returned -10.2% over the past year.


Shareholder returns

S41IndustryMarket
7 Day-0.4%1.6%-0.2%
30 Day0.8%2.3%5.7%
90 Day5.7%25.0%17.8%
1 Year-2.8%-8.0%8.5%4.4%-5.3%-10.2%
3 Year5.0%-10.8%27.8%17.3%-11.2%-22.0%
5 Year42.9%12.2%80.7%60.7%24.9%2.0%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Hong Leong Finance undervalued compared to its fair value and its price relative to the market?

16.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: S41 (SGD2.4) is trading below our estimate of fair value (SGD2.87)

Significantly Below Fair Value: S41 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: S41 is good value based on its PE Ratio (12.3x) compared to the XA Consumer Finance industry average (13x).

PE vs Market: S41 is good value based on its PE Ratio (12.3x) compared to the SG market (15.4x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate S41's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: S41 is good value based on its PB Ratio (0.6x) compared to the XA Consumer Finance industry average (0.8x).


Next Steps

Future Growth

How is Hong Leong Finance forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

26.5%

Forecasted Diversified Financials industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Hong Leong Finance has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Hong Leong Finance performed over the past 5 years?

12.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: S41 has high quality earnings.

Growing Profit Margin: S41's current net profit margins (47.2%) are lower than last year (50%).


Past Earnings Growth Analysis

Earnings Trend: S41's earnings have grown by 12.4% per year over the past 5 years.

Accelerating Growth: S41's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: S41 had negative earnings growth (-24.5%) over the past year, making it difficult to compare to the Consumer Finance industry average (-11.6%).


Return on Equity

High ROE: S41's Return on Equity (4.6%) is considered low.


Next Steps

Financial Health

How is Hong Leong Finance's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet


Financial Institutions Analysis

Asset Level: S41's Assets to Equity ratio (7.3x) is low.

Allowance for Bad Loans: S41 has a low allowance for bad loans (21%).

Low Risk Liabilities: 98% of S41's liabilities are made up of primarily low risk sources of funding.

Loan Level: S41 has an appropriate level of Loans to Assets ratio (80%).

Low Risk Deposits: S41's Loans to Deposits ratio (95%) is appropriate.

Level of Bad Loans: S41 has an appropriate level of bad loans (0.8%).


Next Steps

Dividend

What is Hong Leong Finance current dividend yield, its reliability and sustainability?

6.25%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: S41's dividend (6.25%) is higher than the bottom 25% of dividend payers in the SG market (2.1%).

High Dividend: S41's dividend (6.25%) is in the top 25% of dividend payers in the SG market (4.96%)


Stability and Growth of Payments

Stable Dividend: S41's dividend payments have been volatile in the past 10 years.

Growing Dividend: S41's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (69.4%), S41's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

3.6yrs

Average management tenure


CEO

Leng Beng Kwek (79 yo)

41.83yrs

Tenure

S$2,668,000

Compensation

Mr. Leng Beng Kwek has been Managing Director of Target Realty Ltd. since February 1, 1979 and has also been its Chairman since November 28, 1984. Mr. Kwek served as Managing Director and Chairman of City ...


CEO Compensation Analysis

Compensation vs Market: Leng Beng's total compensation ($USD2.01M) is above average for companies of similar size in the SG market ($USD677.79K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Leng Beng Kwek
Executive Chairman & MD41.83yrsS$2.67m1.84%
SGD 20.0m
Tang Ang
President4.25yrsno datano data
Poh Yeo
Chief Financial Officer2.92yrsno datano data
Benjamin Ng
Senior Vice President of Operationsno datano datano data
Yeng Yuen Tang
VP & Head of Corporate Financeno datano datano data
Andrew Low
Senior VP of Human Resourcesno datano datano data
Chee Leong
Senior VP of Risk Management and Credit Controlno datano datano data
Jeffrey Toh
Senior VP of Corporate & Consumer Businessno datano datano data
Guat Peh
Senior VP of Corporate & Consumer Businessno datano datano data
Swee Gim Yeo
Company Secretaryno datano datano data
Siew Ping Ng
Company Secretary2.33yrsno datano data

3.6yrs

Average Tenure

Experienced Management: S41's management team is considered experienced (3.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Leng Beng Kwek
Executive Chairman & MD41.83yrsS$2.67m1.84%
SGD 20.0m
Leng Peck Kwek
Non-Executive & Non-Independent Directorno dataS$138.00k0.12%
SGD 1.3m
Shao Shing Cheng
Non-Executive & Independent Director16.75yrsS$271.00kno data
Beng Hua Chng
Non-Executive & Independent Director20.5yrsS$75.00kno data
Leng Kee Kwek
Non-Executive & Non-Independent Director19.33yrsS$75.00kno data
Kevin Hangchi
Non-Executive & Non-Independent Director4.25yrsS$119.00k0.11%
SGD 1.1m
Siang Keat Lim
Non-Executive & Independent Director8.83yrsS$137.00kno data
Po'ad bin Shaik Abu Bakar Mattar
Lead Independent Director10.33yrsS$167.00kno data
Kim Cheu Ter
Non-Executive & Independent Director10.33yrsS$156.00kno data
Tee How Tan
Non-Executive & Independent Director1.58yrsS$87.00kno data
Siew San Tan
Non-Executive & Independent Director1.58yrsS$44.00kno data
Fook Yuen Chay
Non-Executive & Independent Director1.58yrsS$76.00kno data

10.3yrs

Average Tenure

65yo

Average Age

Experienced Board: S41's board of directors are seasoned and experienced ( 10.3 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.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Hong Leong Finance Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Hong Leong Finance Limited
  • Ticker: S41
  • Exchange: SGX
  • Founded: 1961
  • Industry: Consumer Finance
  • Sector: Diversified Financials
  • Market Cap: S$1.088b
  • Shares outstanding: 447.56m
  • Website: https://www.hlf.com.sg

Number of Employees


Location

  • Hong Leong Finance Limited
  • No. 01-05 Hong Leong Building
  • 16 Raffles Quay
  • Singapore
  • 48581
  • Singapore

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
S41SGX (Singapore Exchange)YesOrdinary SharesSGSGDJan 1992

Biography

Hong Leong Finance Limited provides various financial services for business enterprises and retail customers in Singapore. It accepts savings and business current accounts, as well as fixed deposits. The c...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/01/26 11:07
End of Day Share Price2021/01/26 00:00
Earnings2020/06/30
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.