ArcSoft Corp. Ltd. (688088) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

ArcSoft Corp. Ltd.

Why is ArcSoft Corp. Ltd. ?

Poor Management Efficiency with a low ROCE of 29.70%

The company has been able to generate a Return on Capital Employed (avg) of 29.70% signifying low profitability per unit of total capital (equity and debt)

Poor long term growth as Net Sales has grown by an annual rate of 5.73% and Operating profit at -10.80% over the last 5 years

Flat results in Sep 25

DEBT-EQUITY RATIO (HY) Highest at -65.01 %
CASH AND EQV(HY) Lowest at CNY 3,641.23 MM
DEBTORS TURNOVER RATIO(HY) Lowest at 3.89 times

With ROE of 7.24%, it has a expensive valuation with a 8.42 Price to Book Value

Over the past year, while the stock has generated a return of -8.90%, its profits have risen by 104.3% ; the PEG ratio of the company is 1.1
At the current price, the company has a high dividend yield of 0.8

Underperformed the market in the last 1 year

Even though the market (China Shanghai Composite) has generated returns of 22.49% in the last 1 year, the stock has hugely underperformed and has generate negative returns of -8.90% returns

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to ArcSoft Corp. Ltd. should be less than 10%
Overall Portfolio exposure to Software Products should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Software Products)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is ArcSoft Corp. Ltd. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

ArcSoft Corp. Ltd.

-12.74%

1.12

49.98%

China Shanghai Composite

15.17%

1.58

14.20%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

5.73%

EBIT Growth (5y)

-10.80%

EBIT to Interest (avg)

75.38

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.67

Sales to Capital Employed (avg)

0.28

Tax Ratio

12.11%

Dividend Payout Ratio

90.72%

Pledged Shares

Institutional Holding

ROCE (avg)

29.70%

ROE (avg)

5.07%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

116

Industry P/E

Price to Book Value

8.42

EV to EBIT

194.03

EV to EBITDA

139.72

EV to Capital Employed

25.73

EV to Sales

25.05

PEG Ratio

1.12

Dividend Yield

0.84%

ROCE (Latest)

13.26%

ROE (Latest)

7.24%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bearish

Dow Theory

Mildly Bearish

OBV

Mildly Bearish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

10What is working for the Company

OPERATING CASH FLOW(Y)

Highest at CNY 183.55 MM

NET PROFIT(HY)

At CNY 80.48 MM has Grown at 50.04%

ROCE(HY)

Highest at 8.74%

RAW MATERIAL COST(Y)

Fallen by -3.07% (YoY

-5What is not working for the Company

DEBT-EQUITY RATIO (HY)

Highest at -65.01 %

CASH AND EQV(HY)

Lowest at CNY 3,641.23 MM

DEBTORS TURNOVER RATIO(HY)

Lowest at 3.89 times

OPERATING PROFIT MARGIN(Q)

Lowest at 11.34 %

Here's what is working for ArcSoft Corp. Ltd.

Net Profit

At CNY 80.48 MM has Grown at 50.04%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is positive

Net Profit (CNY MM)

Operating Cash Flow

Highest at CNY 183.55 MM

in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (CNY MM)

Raw Material Cost

Fallen by -3.07% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Here's what is not working for ArcSoft Corp. Ltd.

Debt-Equity Ratio

Highest at -65.01 % and Grown

In each half year in the last five Semi-Annual periods

MOJO Watch

The company is borrowing more to fund its operations; it's liquidity situation may be stressed

Debt-Equity Ratio

Operating Profit Margin

Lowest at 11.34 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Cash and Eqv

Lowest at CNY 3,641.23 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is deteriorating

Cash and Cash Equivalents

Debtors Turnover Ratio

Lowest at 3.89 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio