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

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Otsuka Pakistan Ltd.

Abbott Laboratories (Pakistan) Ltd.

GlaxoSmithKline Pakistan Ltd.

Haleon Pakistan Ltd.

Highnoon Laboratories Ltd.

Hoechst Pakistan Ltd.

AGP Ltd.

Ferozsons Laboratories Ltd.

Macter International Ltd.

Citi Pharma Ltd.

The Searle Co. 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

26.26%

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

Bearish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bearish

Dow Theory

No Trend

Mildly Bearish

OBV

Mildly Bullish

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

1What is working for the Company

RAW MATERIAL COST(Y)

Fallen by -7.67% (YoY

-7What is not working for the Company

INTEREST(Q)

At PKR 41.77 MM has Grown at 32.57%

INVENTORY TURNOVER RATIO(HY)

Lowest at 2.3 times

OPERATING PROFIT MARGIN(Q)

Lowest at 18.56 %

PRE-TAX PROFIT(Q)

Lowest at PKR 1,058.96 MM

NET PROFIT(Q)

Lowest at PKR 634.86 MM

EPS(Q)

Lowest at PKR 13.79

Here's what is working for Highnoon Laboratories Ltd.

Raw Material Cost

Fallen by -7.67% (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 41.77 MM has Grown at 32.57%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (PKR MM)

Operating Profit Margin

Lowest at 18.56 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Pre-Tax Profit

Lowest at PKR 1,058.96 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (PKR MM)

Net Profit

Lowest at PKR 634.86 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (PKR MM)

EPS

Lowest at PKR 13.79

in the last five periods

MOJO Watch

Declining profitability; company has created lower earnings for shareholders

EPS (PKR)

Inventory Turnover Ratio

Lowest at 2.3 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio