Honghua Group Ltd. (196) 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

Jutal Offshore Oil Services Ltd.

CMBC Capital Holdings Ltd.

Honghua Group Ltd.

Dalipal Holdings Ltd.

Shandong Molong Petroleum Machinery Co., Ltd.

Petro-king Oilfield Services Ltd.

Hilong Holding Ltd.

Why is Honghua Group Ltd. ?

High Debt company with Weak Long Term Fundamental Strength

Poor long term growth as Operating profit has grown by an annual rate -28.53% of 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 0.36% signifying low profitability per unit of shareholders funds

With ROE of 0.46%, it has a Very Expensive valuation with a 0.60 Price to Book Value

Over the past year, while the stock has generated a return of 37.50%, its profits have risen by 104.2% ; the PEG ratio of the company is 1.3

Real-Time Research Report

Verdict Report

How much should you sell?

All quantity irrespective of whether you are making profits or losses

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

When to re-enter? - We will constantly monitor the company and review our call based on new data

Is Honghua Group Ltd. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

Honghua Group Ltd.

39.68%

1.91

50.11%

Hang Seng Hong Kong

27.36%

1.03

25.88%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

4.90%

EBIT Growth (5y)

-28.53%

EBIT to Interest (avg)

-0.95

Debt to EBITDA (avg)

33.47

Net Debt to Equity (avg)

1.07

Sales to Capital Employed (avg)

0.55

Tax Ratio

100.00%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

ROCE (avg)

0.57%

ROE (avg)

0.36%

Valuation

Valuation Scorecard

Valuation grade scale :

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

Valuation Key Factors

Factor

Value

P/E Ratio

131

Industry P/E

Price to Book Value

0.60

EV to EBIT

116.84

EV to EBITDA

15.48

EV to Capital Employed

0.81

EV to Sales

1.01

PEG Ratio

1.26

Dividend Yield

ROCE (Latest)

0.69%

ROE (Latest)

0.46%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Bullish

RSI

No Signal

Bearish

Bollinger Bands

Bearish

Mildly Bullish

Moving Averages

Mildly Bullish (Daily)

KST

Bearish

Bullish

Dow Theory

No Trend

OBV

No Trend

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

Not enough Data to analyse Financial Trend

Here's what is working for Honghua Group Ltd.

Pre-Tax Profit

At HKD 22.3 MM has Grown at 109.89%

Year on Year (YoY)

MOJO Watch

Near term Pre-Tax Profit trend is very positive

Pre-Tax Profit (HKD MM)

Operating Cash Flow

Highest at HKD 261.38 MM

in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (HKD MM)

Pre-Tax Profit

Highest at HKD 22.3 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (HKD MM)

Net Profit

At HKD -34.54 MM has Grown at 86.19%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is positive

Net Profit (HKD MM)

EPS

Highest at HKD 0

in the last five periods

MOJO Watch

Increasing profitability; company has created higher earnings for shareholders

EPS (HKD)

Debt-Equity Ratio

Lowest at 108.07 %

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 3.21%

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Debtors Turnover Ratio

Highest at 1.23%

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its Debtors faster

Debtors Turnover Ratio

Depreciation

At HKD 188.5 MM has Grown at 20.79%

period on period (QoQ)

MOJO Watch

The expenditure on assets done by the company has gone into productive use which should positively reflect in the future sales

Depreciation (HKD MM)

Here's what is not working for Honghua Group Ltd.

Interest

At HKD 81.5 MM has Grown at 29.66%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (HKD MM)

Raw Material Cost

Grown by 25.96% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has deteriorated; this may lead to a fall in profit margin

Raw Material Cost as a percentage of Sales

Non Operating Income

Highest at HKD 16.15 MM

in the last five periods

MOJO Watch

Increased income from non business activities may not be sustainable

Non Operating income