China National Software & Service Co., Ltd. (600536) 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

China National Software & Service Co., Ltd.

Why is China National Software & Service Co., Ltd. ?

Poor Management Efficiency with a low ROCE of 0%

The company has reported losses and also has negative networth. This is not a good sign for the investors. Either company will have to raise fresh capital or report profits to sustain going forward

Poor long term growth as Net Sales has grown by an annual rate of 2.18% and Operating profit at -6.41% over the last 5 years

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

NO KEY NEGATIVE TRIGGERS

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 -12.83%, its profits have fallen by -121.1%

Below par performance in long term as well as near term

Along with generating -12.83% returns in the last 1 year, the stock has also underperformed China Shanghai Composite in the last 3 years, 1 year and 3 months

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to China National Software & Service Co., 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 China National Software & Service Co., Ltd. for you?

Medium Risk, High Return

Absolute

Risk Adjusted

Volatility

China National Software & Service Co., Ltd.

-16.84%

1.18

32.60%

China Shanghai Composite

13.33%

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)

2.18%

EBIT Growth (5y)

-6.41%

EBIT to Interest (avg)

-5.85

Debt to EBITDA (avg)

Negative Net Debt

Net Debt to Equity (avg)

0.02

Sales to Capital Employed (avg)

1.42

Tax Ratio

5.71%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

ROCE (avg)

ROE (avg)

4.86%

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

12.89

EV to EBIT

-95.99

EV to EBITDA

-183.99

EV to Capital Employed

129.67

EV to Sales

7.88

PEG Ratio

Dividend Yield

ROCE (Latest)

-135.08%

ROE (Latest)

-1.22%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bearish

Dow Theory

Mildly Bearish

OBV

No Trend

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

17What is working for the Company

OPERATING CASH FLOW(Y)

Highest at CNY 839.85 MM

PRE-TAX PROFIT(Q)

At CNY 2.93 MM has Grown at 103.73%

RAW MATERIAL COST(Y)

Fallen by -0.47% (YoY

CASH AND EQV(HY)

Highest at CNY 9,929.21 MM

DEBT-EQUITY RATIO (HY)

Lowest at -85.34 %

INVENTORY TURNOVER RATIO(HY)

Highest at 4.04 times

NET PROFIT(Q)

At CNY -29.51 MM has Grown at 54.53%

0What is not working for the Company

NO KEY NEGATIVE TRIGGERS

Here's what is working for China National Software & Service Co., Ltd.

Pre-Tax Profit

At CNY 2.93 MM has Grown at 103.73%

Year on Year (YoY)

MOJO Watch

Near term Pre-Tax Profit trend is very positive

Pre-Tax Profit (CNY MM)

Operating Cash Flow

Highest at CNY 839.85 MM

in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (CNY MM)

Net Profit

At CNY -29.51 MM has Grown at 54.53%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is positive

Net Profit (CNY MM)

Cash and Eqv

Highest at CNY 9,929.21 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Debt-Equity Ratio

Lowest at -85.34 %

in the last five Semi-Annual periods

MOJO Watch

The company has been reducing its borrowing as compared to equity capital

Debt-Equity Ratio

Inventory Turnover Ratio

Highest at 4.04 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Raw Material Cost

Fallen by -0.47% (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 National Software & Service Co., Ltd.

Non Operating Income

Highest at CNY 9.61 MM

in the last five periods

MOJO Watch

Increased income from non business activities may not be sustainable

Non Operating income