NYSE:CYD

Stock Analysis Report

China Yuchai International

Executive Summary

China Yuchai International Limited, through its subsidiaries, manufactures and sells diesel and natural gas engines in the People’s Republic of China and internationally.

Rewards

Trading at 19.9% below its fair value

Earnings are forecast to grow 26.81% per year

Pays a high and reliable dividend of 6.39%

Risk Analysis

Profit margins (3.5%) are lower than last year (5.5%)



Snowflake Analysis

Very undervalued with flawless balance sheet and pays a dividend.

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-3.5%

CYD

-3.1%

US Machinery

-1.3%

US Market


1 Year Return

-17.6%

CYD

17.1%

US Machinery

22.0%

US Market

Return vs Industry: CYD underperformed the US Machinery industry which returned 22.4% over the past year.

Return vs Market: CYD underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

CYDIndustryMarket
7 Day-3.5%-3.1%-1.3%
30 Day-2.5%-2.5%1.6%
90 Day-3.8%3.4%8.9%
1 Year-12.9%-17.6%19.3%17.1%24.7%22.0%
3 Year16.2%-5.8%37.0%28.2%49.4%39.7%
5 Year0.9%-28.6%77.2%55.9%78.1%58.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is China Yuchai International undervalued compared to its fair value and its price relative to the market?

20.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CYD ($13.23) is trading below our estimate of fair value ($16.51)

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


Price To Earnings Ratio

PE vs Industry: CYD is good value based on its PE Ratio (6.3x) compared to the Machinery industry average (23.4x).

PE vs Market: CYD is good value based on its PE Ratio (6.3x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: CYD is good value based on its PEG Ratio (0.2x)


Price to Book Ratio

PB vs Industry: CYD is good value based on its PB Ratio (0.4x) compared to the US Machinery industry average (2.5x).


Next Steps

Future Growth

How is China Yuchai International forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

26.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CYD's forecast earnings growth (26.8% per year) is above the savings rate (1.7%).

Earnings vs Market: CYD's earnings (26.8% per year) are forecast to grow faster than the US market (14.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: CYD's revenue (6.4% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: CYD's revenue (6.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CYD's Return on Equity is forecast to be low in 3 years time (12.1%).


Next Steps

Past Performance

How has China Yuchai International performed over the past 5 years?

6.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CYD has high quality earnings.

Growing Profit Margin: CYD's current net profit margins (3.5%) are lower than last year (5.5%).


Past Earnings Growth Analysis

Earnings Trend: CYD's earnings have grown by 6.5% per year over the past 5 years.

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

Earnings vs Industry: CYD had negative earnings growth (-31.1%) over the past year, making it difficult to compare to the Machinery industry average (9.6%).


Return on Equity

High ROE: CYD's Return on Equity (7.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is China Yuchai International's financial position?


Financial Position Analysis

Short Term Liabilities: CYD's short term assets (CN¥16.4B) exceed its short term liabilities (CN¥9.6B).

Long Term Liabilities: CYD's short term assets (CN¥16.4B) exceed its long term liabilities (CN¥951.2M).


Debt to Equity History and Analysis

Debt Level: CYD's debt to equity ratio (18.1%) is considered satisfactory.

Reducing Debt: CYD's debt to equity ratio has reduced from 26.8% to 18.1% over the past 5 years.

Debt Coverage: CYD's debt is well covered by operating cash flow (33.3%).

Interest Coverage: CYD earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

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

Debt Coverage by Assets: CYD's debt is covered by short term assets (assets are 8.1x debt).


Next Steps

Dividend

What is China Yuchai International's current dividend yield, its reliability and sustainability?

6.42%

Current Dividend Yield


Dividend Yield vs Market

company6.4%marketbottom25%1.4%markettop25%3.7%industryaverage2.0%forecastin3Years9.2%

Current dividend yield vs market & industry

Notable Dividend: CYD's dividend (6.39%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: CYD's dividend (6.39%) is in the top 25% of dividend payers in the US market (3.66%)


Stability and Growth of Payments

Stable Dividend: CYD's dividends per share have been stable in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (40.7%), CYD's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CYD's dividends in 3 years are forecast to be well covered by earnings (29.3% payout ratio).


Next Steps

Management

What is the CEO of China Yuchai International's salary, the management and board of directors tenure and is there insider trading?

5.0yrs

Average management tenure


CEO

China Yuchai International has no CEO, or we have no data on them.


Management Age and Tenure

5.0yrs

Average Tenure

Experienced Management: CYD's management team is seasoned and experienced (5 years average tenure).


Board Age and Tenure

8.9yrs

Average Tenure

65yo

Average Age

Experienced Board: CYD's board of directors are considered experienced (8.9 years average tenure).


Insider Trading

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.


Management Team

  • Weng Ming Hoh (58yo)

    President & Director

    • Tenure: 8.2yrs
  • Kelvin Lai

    Vice President of Operations

    • Tenure: 9.6yrs
  • Kelly Tay

    Financial Controller

    • Derek Liu

      Assistant Vice President of International Sales

      • Thomas Phung

        Chief Financial Officer

        • Tenure: 3.6yrs
      • Teck Kow Wong

        General Counsel

        • Tenure: 1.7yrs
      • Kevin Theiss

        Head of Investor Relations


        Board Members

        • Leng Peck Kwek (63yo)

          Director

          • Tenure: 26yrs
        • Khai Choon Gan (73yo)

          Director

          • Tenure: 25yrs
        • Weng Ming Hoh (58yo)

          President & Director

          • Tenure: 8.2yrs
        • Raymond Ho

          Independent Director

          • Tenure: 6.8yrs
        • Poh Kiat Neo (68yo)

          Independent Director & Director of Guangxi Yuchai Machinery Company Limited

          • Tenure: 14.7yrs
        • Ping Yan

          Director & Chairman of Guangxi Yuchai Machinery Company Limited

          • Tenure: 14.1yrs
        • Eng Kwee Tan (65yo)

          Director

          • Tenure: 0.9yrs
        • Qiwei Wu

          Alternate Director

          • Tenure: 7.2yrs
        • Yi Han

          Director

          • Tenure: 9.7yrs
        • Tao Xie

          Independent Director

          • Tenure: 0.8yrs

        Company Information

        China Yuchai International Limited's company bio, employee growth, exchange listings and data sources


        Key Information

        • Name: China Yuchai International Limited
        • Ticker: CYD
        • Exchange: NYSE
        • Founded: 1951
        • Industry: Construction Machinery and Heavy Trucks
        • Sector: Capital Goods
        • Market Cap: US$534.426m
        • Shares outstanding: 40.86m
        • Website: https://www.cyilimited.com

        Number of Employees


        Location

        • China Yuchai International Limited
        • Hong Leong Building
        • 16 Raffles Quay No. 39-01A
        • Singapore
        • 48581
        • Singapore

        Listings

        TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
        CYDNYSE (New York Stock Exchange)YesCommon SharesUSUSDDec 1994
        CYDDB (Deutsche Boerse AG)YesCommon SharesDEEURDec 1994

        Biography

        China Yuchai International Limited, through its subsidiaries, manufactures and sells diesel and natural gas engines in the People’s Republic of China and internationally. It operates in two segments, Yuchai and HLGE. The company provides diesel and natural gas engines for light trucks, medium and heavy-duty trucks, buses and passenger vehicles, and marine and industrial applications; and generator sets. It also manufactures diesel engines for construction and agriculture applications, as well as supplies after-market parts and services. In addition, it engages in hospitality and property development activities. Further, the company designs, produces, and sells exhaust emission control systems for commercial vehicles. China Yuchai International Limited distributes its engines directly to auto original equipment manufacturers and retailers, as well as provides maintenance and retrofitting services. The company was founded in 1951 and is based in Singapore. 


        Company Analysis and Financial Data Status

        All financial data provided by Standard & Poor's Capital IQ.
        DataLast Updated (UTC time)
        Company Analysis2020/01/26 00:07
        End of Day Share Price2020/01/24 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.