HIT Welding Industry Co., Ltd. () 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

HIT Welding Industry Co., Ltd.

Why is HIT Welding Industry Co., Ltd. ?

Poor Management Efficiency with a low ROCE of 40.33%

The company has been able to generate a Return on Capital Employed (avg) of 40.33% signifying low profitability per unit of total capital (equity and debt)

Poor long term growth as Net Sales has grown by an annual rate of 0.07% and Operating profit at -76.25% over the last 5 years

The company has declared Negative results for the last 4 consecutive quarters

INTEREST(HY) At CNY 3.94 MM has Grown at 21.79%
NET PROFIT(9M) At CNY 32.35 MM has Grown at -28.1%
ROCE(HY) Lowest at 2.97%

With ROE of 3.11%, it has a attractive valuation with a 0.96 Price to Book Value

Over the past year, while the stock has generated a return of 136.58%, its profits have fallen by -20.4%

Market Beating performance in long term as well as near term

Along with generating 136.58% returns in the last 1 year, the stock has outperformed 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 HIT Welding Industry Co., Ltd. should be less than 10%
Overall Portfolio exposure to Industrial Manufacturing should be less than 30%

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

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

Is HIT Welding Industry Co., Ltd. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

HIT Welding Industry Co., Ltd.

-100.0%

2.68

85.44%

China Shanghai Composite

15.44%

1.01

15.10%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

0.07%

EBIT Growth (5y)

-76.25%

EBIT to Interest (avg)

100.00

Debt to EBITDA (avg)

0.12

Net Debt to Equity (avg)

0.02

Sales to Capital Employed (avg)

0.88

Tax Ratio

5.15%

Dividend Payout Ratio

40.41%

Pledged Shares

Institutional Holding

ROCE (avg)

40.33%

ROE (avg)

3.88%

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

0.96

EV to EBIT

66.34

EV to EBITDA

18.50

EV to Capital Employed

0.97

EV to Sales

0.90

PEG Ratio

Dividend Yield

ROCE (Latest)

1.46%

ROE (Latest)

3.11%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

No Signal

Bollinger Bands

Mildly Bullish

Bullish

Moving Averages

Bullish (Daily)

KST

Bullish

Dow Theory

No Trend

Mildly Bearish

OBV

No Trend

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

1What is working for the Company

RAW MATERIAL COST(Y)

Fallen by -37.71% (YoY

-16What is not working for the Company

INTEREST(HY)

At CNY 3.94 MM has Grown at 21.79%

NET PROFIT(9M)

At CNY 32.35 MM has Grown at -28.1%

ROCE(HY)

Lowest at 2.97%

DEBT-EQUITY RATIO (HY)

Highest at 2.65 %

INTEREST COVERAGE RATIO(Q)

Lowest at 320.28

INVENTORY TURNOVER RATIO(HY)

Lowest at 4.04%

DEBTORS TURNOVER RATIO(HY)

Lowest at 2.73%

OPERATING PROFIT(Q)

Lowest at CNY 6.45 MM

OPERATING PROFIT MARGIN(Q)

Lowest at 1.75 %

Here's what is working for HIT Welding Industry Co., Ltd.

Raw Material Cost

Fallen by -37.71% (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 HIT Welding Industry Co., Ltd.

Interest

At CNY 3.94 MM has Grown at 21.79%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Interest Coverage Ratio

Lowest at 320.28

in the last five periods

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Debt-Equity Ratio

Highest at 2.65 % and Grown

In each half year in the last five Semi-Annual periods

MOJO Watch

The company is borrowing more to fund its operations; it's liquidity situation may be stressed

Debt-Equity Ratio

Net Profit

At CNY 32.35 MM has Grown at -28.1%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is negative

Net Profit (CNY MM)

Operating Profit

Lowest at CNY 6.45 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is negative

Operating Profit (CNY MM)

Operating Profit Margin

Lowest at 1.75 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Inventory Turnover Ratio

Lowest at 4.04%

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio

Debtors Turnover Ratio

Lowest at 2.73%

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio