Highnoon Laboratories Ltd. (HINOON) 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

Hoechst Pakistan Ltd.

Otsuka Pakistan Ltd.

Abbott Laboratories (Pakistan) Ltd.

Haleon Pakistan Ltd.

Highnoon Laboratories Ltd.

GlaxoSmithKline Pakistan Ltd.

AGP Ltd.

Ferozsons Laboratories Ltd.

Macter International Ltd.

The Searle Co. Ltd.

Citi Pharma Ltd.

Why is Highnoon Laboratories Ltd. ?

Strong Long Term Fundamental Strength with an average Return on Equity (ROE) of 29.01%

Healthy long term growth as Net Sales has grown by an annual rate of 21.86% and Operating profit at 30.30%
Company's ability to service its debt is strong with a healthy EBIT to Interest (avg) ratio of 52.45

With ROE of 27.2, it has a attractive valuation with a 3.7 Price to Book Value

The stock is trading at a discount compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 0%, its profits have risen by 31.6% ; the PEG ratio of the company is 0.4
At the current price, the company has a high dividend yield of 4.5

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Highnoon Laboratories Ltd. should be less than 10%
Overall Portfolio exposure to Pharmaceuticals & Biotechnology should be less than 30%

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

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

Is Highnoon Laboratories Ltd. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Highnoon Laboratories Ltd.

29.91%

1.23

29.97%

Pakistan KSE 100 Share

60.28%

2.81

22.77%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

20.74%

EBIT Growth (5y)

26.62%

EBIT to Interest (avg)

52.45

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.30

Sales to Capital Employed (avg)

1.95

Tax Ratio

32.94%

Dividend Payout Ratio

62.54%

Pledged Shares

Institutional Holding

ROCE (avg)

60.12%

ROE (avg)

29.01%

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

5.28

EV to EBIT

9.77

EV to EBITDA

9.17

EV to Capital Employed

6.42

EV to Sales

2.25

PEG Ratio

0.88

Dividend Yield

3.51%

ROCE (Latest)

65.79%

ROE (Latest)

29.99%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bearish

Bullish

RSI

No Signal

Bollinger Bands

Bearish

Mildly Bullish

Moving Averages

Mildly Bullish (Daily)

KST

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

9What is working for the Company

OPERATING CASH FLOW(Y)

Highest at PKR 4,523.88 MM

RAW MATERIAL COST(Y)

Fallen by -6.66% (YoY

CASH AND EQV(HY)

Highest at PKR 9,466.52 MM

DEBT-EQUITY RATIO (HY)

Lowest at -29.35 %

INVENTORY TURNOVER RATIO(HY)

Highest at 2.92%

NET SALES(Q)

Highest at PKR 7,025.9 MM

NET PROFIT(Q)

Highest at PKR 954.56 MM

-7What is not working for the Company

INTEREST(HY)

At PKR 257.77 MM has Grown at 152.74%

DEBTORS TURNOVER RATIO(HY)

Lowest at 6.33%

Here's what is working for Highnoon Laboratories Ltd.

Operating Cash Flow

Highest at PKR 4,523.88 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 (PKR MM)

Net Sales

Highest at PKR 7,025.9 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (PKR MM)

Net Profit

Highest at PKR 954.56 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is positive

Net Profit (PKR MM)

Cash and Eqv

Highest at PKR 9,466.52 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Debt-Equity Ratio

Lowest at -29.35 %

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 2.92%

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 -6.66% (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 Highnoon Laboratories Ltd.

Interest

At PKR 257.77 MM has Grown at 152.74%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (PKR MM)

Debtors Turnover Ratio

Lowest at 6.33%

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio