Guizhou Tyre Co., Ltd. (000589) 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

Guizhou Tyre Co., Ltd.

Why is Guizhou Tyre Co., Ltd. ?

High Debt Company with a Debt to Equity ratio (avg) at times

Poor long term growth as Net Sales has grown by an annual rate of 10.52% and Operating profit at 0.41% over the last 5 years
High Debt Company with a Debt to Equity ratio (avg) at times
The company has been able to generate a Return on Equity (avg) of 10.24% signifying low profitability per unit of shareholders funds

The company has declared Negative results for the last 3 consecutive quarters

OPERATING CASH FLOW(Y) Lowest at CNY 764.63 MM
NET PROFIT(9M) At CNY 449.97 MM has Grown at -19.72%
INTEREST(HY) At CNY 61.15 MM has Grown at 9.48%

With ROE of 5.07%, it has a very expensive valuation with a 0.80 Price to Book Value

Over the past year, while the stock has generated a return of -12.77%, its profits have fallen by -52.1%
At the current price, the company has a high dividend yield of 2.1

Below par performance in long term as well as near term

Along with generating -12.77% 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 Guizhou Tyre Co., Ltd. should be less than 10%
Overall Portfolio exposure to Auto Components & Equipments should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Auto Components & Equipments)

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

Is Guizhou Tyre Co., Ltd. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Guizhou Tyre Co., Ltd.

-10.78%

-0.93

21.90%

China Shanghai Composite

13.33%

0.90

14.74%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

10.52%

EBIT Growth (5y)

0.41%

EBIT to Interest (avg)

5.09

Debt to EBITDA (avg)

3.58

Net Debt to Equity (avg)

0.41

Sales to Capital Employed (avg)

0.68

Tax Ratio

12.02%

Dividend Payout Ratio

29.55%

Pledged Shares

Institutional Holding

ROCE (avg)

6.06%

ROE (avg)

10.24%

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

0.80

EV to EBIT

22.23

EV to EBITDA

10.08

EV to Capital Employed

0.86

EV to Sales

1.01

PEG Ratio

Dividend Yield

2.14%

ROCE (Latest)

3.86%

ROE (Latest)

5.07%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bullish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Mildly Bullish (Daily)

KST

Mildly Bearish

Mildly Bullish

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

8What is working for the Company

DIVIDEND PAYOUT RATIO(Y)

Highest at 30.77%

RAW MATERIAL COST(Y)

Fallen by -30.06% (YoY

DIVIDEND PER SHARE(HY)

Highest at CNY 2.79

PRE-TAX PROFIT(Q)

Highest at CNY 231.28 MM

NET PROFIT(Q)

Highest at CNY 201.43 MM

EPS(Q)

Highest at CNY 0.12

-9What is not working for the Company

OPERATING CASH FLOW(Y)

Lowest at CNY 764.63 MM

NET PROFIT(9M)

At CNY 449.97 MM has Grown at -19.72%

INTEREST(HY)

At CNY 61.15 MM has Grown at 9.48%

ROCE(HY)

Lowest at 5.73%

DEBTORS TURNOVER RATIO(HY)

Lowest at 2.79 times

Here's what is working for Guizhou Tyre Co., Ltd.

Pre-Tax Profit

Highest at CNY 231.28 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 231.28 MM has Grown at 85.2%

over average net sales of the previous four periods of CNY 124.88 MM

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (CNY MM)

Net Profit

Highest at CNY 201.43 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is positive

Net Profit (CNY MM)

Net Profit

At CNY 201.43 MM has Grown at 84.23%

over average net sales of the previous four periods of CNY 109.33 MM

MOJO Watch

Near term Net Profit trend is positive

Net Profit (CNY MM)

EPS

Highest at CNY 0.12

in the last five periods

MOJO Watch

Increasing profitability; company has created higher earnings for shareholders

EPS (CNY)

Dividend per share

Highest at CNY 2.79

in the last five years

MOJO Watch

Company is distributing higher dividend from profits generated

DPS (CNY)

Dividend Payout Ratio

Highest at 30.77%

in the last five years

MOJO Watch

Company is distributing higher proportion of profits generated as dividend

DPR (%)

Raw Material Cost

Fallen by -30.06% (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 Guizhou Tyre Co., Ltd.

Interest

At CNY 61.15 MM has Grown at 9.48%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Operating Cash Flow

Lowest at CNY 764.63 MM

in the last three years

MOJO Watch

The company's cash revenues from business operations are falling

Operating Cash Flows (CNY MM)

Debtors Turnover Ratio

Lowest at 2.79 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio