OTCPK:VTKL.Y

Stock Analysis Report

Executive Summary

Vtech Holdings Limited designs, manufactures, and distributes consumer electronic products in North America, Europe, the Asia Pacific, and internationally.


Snowflake Analysis

Flawless balance sheet and good value.


Similar Companies

Share Price & News

How has Vtech Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

0.2%

VTKL.Y

-1.1%

US Communications

-1.1%

US Market


1 Year Return

-8.5%

VTKL.Y

-8.7%

US Communications

17.8%

US Market

Return vs Industry: VTKL.Y matched the US Communications industry which returned -8.7% over the past year.

Return vs Market: VTKL.Y underperformed the US Market which returned 17.8% over the past year.


Shareholder returns

VTKL.YIndustryMarket
7 Day0.2%-1.1%-1.1%
30 Day-4.0%-4.9%1.5%
90 Day-2.0%1.8%6.6%
1 Year-2.3%-8.5%-6.8%-8.7%20.2%17.8%
3 Year-0.1%-16.2%30.6%22.3%47.5%38.1%
5 Year-14.8%-34.7%57.6%39.9%71.2%52.4%

Price Volatility Vs. Market

How volatile is Vtech Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Vtech Holdings undervalued compared to its fair value and its price relative to the market?

34.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: VTKL.Y ($9.29) is trading below our estimate of fair value ($14.16)

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


Price To Earnings Ratio

PE vs Industry: VTKL.Y is good value based on its PE Ratio (11.5x) compared to the Communications industry average (24.7x).

PE vs Market: VTKL.Y is good value based on its PE Ratio (11.5x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: VTKL.Y is poor value based on its PEG Ratio (11.6x)


Price to Book Ratio

PB vs Industry: VTKL.Y is overvalued based on its PB Ratio (4x) compared to the US Communications industry average (1.9x).


Next Steps

Future Growth

How is Vtech Holdings forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

1.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: VTKL.Y's forecast earnings growth (1% per year) is below the savings rate (1.7%).

Earnings vs Market: VTKL.Y's earnings (1% per year) are forecast to grow slower than the US market (14.1% per year).

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

Revenue vs Market: VTKL.Y's revenue (2.6% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: VTKL.Y's revenue (2.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: VTKL.Y's Return on Equity is forecast to be high in 3 years time (33%)


Next Steps

Past Performance

How has Vtech Holdings performed over the past 5 years?

-0.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: VTKL.Y has high quality earnings.

Growing Profit Margin: VTKL.Y's current net profit margins (8.7%) are lower than last year (9.2%).


Past Earnings Growth Analysis

Earnings Trend: VTKL.Y's earnings have declined by -0.5% per year over the past 5 years.

Accelerating Growth: VTKL.Y's earnings growth over the past year (3.3%) exceeds its 5-year average (-0.5% per year).

Earnings vs Industry: VTKL.Y earnings growth over the past year (3.3%) exceeded the Communications industry -19.9%.


Return on Equity

High ROE: VTKL.Y's Return on Equity (35.1%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Vtech Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: VTKL.Y's short term assets ($1.1B) exceed its short term liabilities ($699.8M).

Long Term Liabilities: VTKL.Y's short term assets ($1.1B) exceed its long term liabilities ($123.4M).


Debt to Equity History and Analysis

Debt Level: VTKL.Y is debt free.

Reducing Debt: VTKL.Y had no debt 5 years ago.

Debt Coverage: VTKL.Y has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: VTKL.Y has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

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

Debt Coverage by Assets: Insufficient data to determine if VTKL.Y's debt is covered by short term assets.


Next Steps

Dividend

What is Vtech Holdings's current dividend yield, its reliability and sustainability?

7.35%

Current Dividend Yield


Dividend Yield vs Market

company7.3%marketbottom25%1.4%markettop25%3.7%industryaverage3.0%forecastin3Years8.2%

Current dividend yield vs market & industry

Notable Dividend: VTKL.Y's dividend (7.35%) is higher than the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: VTKL.Y's dividend (7.35%) is in the top 25% of dividend payers in the US market (3.73%)


Stability and Growth of Payments

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

Growing Dividend: VTKL.Y's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (84.6%), VTKL.Y's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: VTKL.Y's dividends in 3 years are not forecast to be well covered by earnings (91.6% payout ratio).


Next Steps

  • Explore strong dividend paying companies in the Tech industry.

Management

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

11.1yrs

Average board tenure


CEO

Allan Wong (68yo)

16.1yrs

Tenure

US$2,932,000

Compensation

Dr. Chi-Yun Wong, also known as Allan, GBS, SBS, B.Sc., JP, MBE, MSEE, Hon DTech, JP, has been an Independent Non-Executive Director of Li & Fung Limited since March 30, 1999. He co-founded VTech Holdings  ...


CEO Compensation Analysis

Compensation vs Market: Allan's total compensation ($USD2.93M) is about average for companies of similar size in the US market ($USD3.81M).

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


Board Members

NamePositionTenureCompensationOwnership
Chi-Yun Wong
Co-Founder16.1yrsUS$2.93m26.6% $610.0m
King Fai Pang
President & Executive Director 12.8yrsUS$1.73m0.11% $2.4m
Hon Kwong Leung
CEO of Contract Manufacturing Services & Executive Director11.1yrsUS$2.83m0.16% $3.6m
Ping Keung Ko
Independent Non-Executive Director2.1yrsUS$37.00kno data
Shui Chung Wang
Independent Non Executive Director18.3yrsUS$38.00k0.064% $1.5m
Kwok-Lun Fung
Independent Non Executive Director18.3yrsUS$38.00k0.42% $9.5m
Kai-Man Wong
Independent Non-Executive Director7.4yrsUS$39.00kno data
Yee Lai Wong
Non-Executive Director0.3yrsno datano data

11.1yrs

Average Tenure

68yo

Average Age

Experienced Board: VTKL.Y's board of directors are seasoned and experienced ( 11.1 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

Vtech Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Vtech Holdings Limited
  • Ticker: VTKL.Y
  • Exchange: OTCPK
  • Founded: 1976
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: HK$17.859b
  • Listing Market Cap: HK$2.293b
  • Shares outstanding: 251.54m
  • Website: https://www.vtech.com/index.html

Number of Employees


Location

  • Vtech Holdings Limited
  • Tai Ping Industrial Centre
  • 23rd Floor
  • Tai Po
  • New Territories
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
VTKL.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
303SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDJan 1992
VTCBDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
303SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesOrdinary SharesHKHKDJan 1992
303SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesOrdinary SharesHKHKDJan 1992
VTKL.YOTCPK (Pink Sheets LLC)UNSPONSORED ADRUSUSDMar 2011

Biography

Vtech Holdings Limited designs, manufactures, and distributes consumer electronic products in North America, Europe, the Asia Pacific, and internationally. The company offers electronic learning toys for infancy, toddler, and preschool under the Vtech and Leap Frog brands; platform products; and learning programs. It also provides telecommunication products, such as residential and commercial phones; and other telecommunication products, including integrated access devices, baby monitors, handsets, wireless monitoring systems, and baby soothers. In addition, the company offers contract electronic manufacturing services for customers in the areas of professional audio equipment, hearables, medical and health products, and industrial products. Further, it is involved in the property holding activities; development of broadband connectivity software; sale of electronic and telecommunication products; and manufacture of plastic products. The company was founded in 1976 and is headquartered in Tai Po, Hong Kong. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/24 01:59
End of Day Share Price2020/02/21 00:00
Earnings2019/09/30
Annual Earnings2019/03/31


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.