China First Heavy Industries (601106) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

China First Heavy Industries

Why is China First Heavy Industries ?

Weak Long Term Fundamental Strength with an average Return on Capital Employed (ROCE) of 1.10%

Poor long term growth as Net Sales has grown by an annual rate of -4.95% and Operating profit at -239.39% over the last 5 years
High Debt Company with a Debt to Equity ratio (avg) at times

The company has declared Negative results for the last 10 consecutive quarters

NET PROFIT(HY) At CNY -3,634.62 MM has Grown at -25.86%
ROCE(HY) Lowest at -52.06%
INVENTORY TURNOVER RATIO(HY) Lowest at 1.88%

Risky -

The stock is trading risky as compared to its average historical valuations
Over the past year, while the stock has generated a return of -3.12%, its profits have fallen by -24%

Underperformed the market in the last 1 year

Even though the market (China Shanghai Composite) has generated returns of 14.77% in the last 1 year, the stock has hugely underperformed and has generate negative returns of -3.12% returns

Real-Time Research Report

Verdict Report

How much should you sell?

All quantity irrespective of whether you are making profits or losses

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

When to re-enter? - We will constantly monitor the company and review our call based on new data

Is China First Heavy Industries for you?

Medium Risk, High Return

Absolute

Risk Adjusted

Volatility

China First Heavy Industries

-100.0%

0.85

30.49%

China Shanghai Composite

15.19%

1.01

14.58%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

-4.95%

EBIT Growth (5y)

-239.39%

EBIT to Interest (avg)

-1.57

Debt to EBITDA (avg)

Negative Net Debt

Net Debt to Equity (avg)

3.53

Sales to Capital Employed (avg)

0.57

Tax Ratio

2.66%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

ROCE (avg)

1.10%

ROE (avg)

0.66%

Valuation

Valuation Scorecard

Valuation grade scale :

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

Valuation Key Factors

Factor

Value

P/E Ratio

NA (Loss Making)

Industry P/E

Price to Book Value

3.74

EV to EBIT

-13.08

EV to EBITDA

-18.08

EV to Capital Employed

1.60

EV to Sales

3.11

PEG Ratio

Dividend Yield

ROCE (Latest)

-12.21%

ROE (Latest)

-69.58%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

No Signal

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Bullish

Dow Theory

Mildly Bullish

Mildly Bearish

OBV

Mildly Bearish

No Trend

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

8What is working for the Company

OPERATING CASH FLOW(Y)

Highest at CNY 744.86 MM

RAW MATERIAL COST(Y)

Fallen by -65.93% (YoY

CASH AND EQV(HY)

Highest at CNY 5,537 MM

PRE-TAX PROFIT(Q)

Highest at CNY 70.16 MM

NET PROFIT(Q)

At CNY -83.15 MM has Grown at 91.09%

-17What is not working for the Company

NET PROFIT(HY)

At CNY -3,634.62 MM has Grown at -25.86%

ROCE(HY)

Lowest at -52.06%

INVENTORY TURNOVER RATIO(HY)

Lowest at 1.88%

DEBT-EQUITY RATIO (HY)

Highest at 356.44 %

NET SALES(Q)

Lowest at CNY 2,231.37 MM

Here's what is working for China First Heavy Industries

Operating Cash Flow

Highest at CNY 744.86 MM and Grown

In each year in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (CNY MM)

Pre-Tax Profit

Highest at CNY 70.16 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (CNY MM)

Pre-Tax Profit

At CNY 70.16 MM has Grown at 107.98%

over average net sales of the previous four periods of CNY -879.65 MM

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (CNY MM)

Net Profit

At CNY -83.15 MM has Grown at 91.09%

over average net sales of the previous four periods of CNY -933.61 MM

MOJO Watch

Near term Net Profit trend is positive

Net Profit (CNY MM)

Cash and Eqv

Highest at CNY 5,537 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Raw Material Cost

Fallen by -65.93% (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 China First Heavy Industries

Net Sales

At CNY 2,231.37 MM has Fallen at -45.96%

over average net sales of the previous four periods of CNY 4,129 MM

MOJO Watch

Near term sales trend is extremely negative

Net Sales (CNY MM)

Inventory Turnover Ratio

Lowest at 1.88% and Fallen

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

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio

Net Sales

Lowest at CNY 2,231.37 MM

in the last five periods

MOJO Watch

Near term sales trend is negative

Net Sales (CNY MM)

Debt-Equity Ratio

Highest at 356.44 %

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