GEM Co., Ltd. (002340) 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

GEM Co., Ltd.

Why is GEM Co., Ltd. ?

The company is Net-Debt Free

Poor long term growth as Net Sales has grown by an annual rate of 22.02% and Operating profit at 22.33% over the last 5 years
The company is Net-Debt Free
The company has been able to generate a Return on Equity (avg) of 5.95% signifying low profitability per unit of shareholders funds

Flat results in Mar 26

INTEREST(HY) At CNY 521.27 MM has Grown at 35.98%
INTEREST COVERAGE RATIO(Q) Lowest at 533.68
NET PROFIT(HY) At CNY 842.75 MM has Grown at -22.59%

With ROE of 7.44%, it has a attractive valuation with a 1.59 Price to Book Value

Over the past year, while the stock has generated a return of 12.28%, its profits have fallen by -19.7%
At the current price, the company has a high dividend yield of 1

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to GEM Co., Ltd. should be less than 10%
Overall Portfolio exposure to Specialty Chemicals should be less than 30%

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

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

Is GEM Co., Ltd. for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

GEM Co., Ltd.

12.28%

0.22

41.83%

China Shanghai Composite

19.22%

1.40

13.75%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

22.02%

EBIT Growth (5y)

22.33%

EBIT to Interest (avg)

2.28

Debt to EBITDA (avg)

6.26

Net Debt to Equity (avg)

1.41

Sales to Capital Employed (avg)

0.67

Tax Ratio

16.21%

Dividend Payout Ratio

30.65%

Pledged Shares

Institutional Holding

ROCE (avg)

4.61%

ROE (avg)

5.95%

Valuation

Valuation Scorecard

Valuation grade scale :

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

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

1.59

EV to EBIT

20.92

EV to EBITDA

12.41

EV to Capital Employed

1.25

EV to Sales

1.72

PEG Ratio

Dividend Yield

0.97%

ROCE (Latest)

5.98%

ROE (Latest)

7.44%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Bullish

Dow Theory

Mildly Bullish

Mildly Bearish

OBV

Mildly Bullish

Bullish

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

9What is working for the Company

OPERATING CASH FLOW(Y)

Highest at CNY 3,392.73 MM

ROCE(HY)

Highest at 7.56%

RAW MATERIAL COST(Y)

Fallen by -51.94% (YoY

CASH AND EQV(HY)

Highest at CNY 11,961.05 MM

NET SALES(Q)

Highest at CNY 9,981.67 MM

EPS(Q)

Highest at CNY 0.1

-15What is not working for the Company

INTEREST(HY)

At CNY 521.27 MM has Grown at 35.98%

INTEREST COVERAGE RATIO(Q)

Lowest at 533.68

NET PROFIT(HY)

At CNY 842.75 MM has Grown at -22.59%

INVENTORY TURNOVER RATIO(HY)

Lowest at 3.06 times

OPERATING PROFIT MARGIN(Q)

Lowest at 10.87 %

Here's what is working for GEM Co., Ltd.

Operating Cash Flow

Highest at CNY 3,392.73 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)

Net Sales

Highest at CNY 9,981.67 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (CNY MM)

EPS

Highest at CNY 0.1

in the last five periods

MOJO Watch

Increasing profitability; company has created higher earnings for shareholders

EPS (CNY)

Cash and Eqv

Highest at CNY 11,961.05 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Raw Material Cost

Fallen by -51.94% (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 GEM Co., Ltd.

Interest

At CNY 521.27 MM has Grown at 35.98%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Interest Coverage Ratio

Lowest at 533.68 and Fallen

In each period in the last five periods

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Net Profit

At CNY 842.75 MM has Grown at -22.59%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is negative

Net Profit (CNY MM)

Operating Profit Margin

Lowest at 10.87 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Inventory Turnover Ratio

Lowest at 3.06 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio