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

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 14.63%, 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.

14.63%

2.08

52.45%

Hang Seng Hong Kong

8.25%

0.41

19.93%

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

Mildly Bearish

RSI

Bullish

No Signal

Bollinger Bands

Mildly Bullish

Bullish

Moving Averages

Bearish (Daily)

KST

Bullish

Mildly Bearish

Dow Theory

Mildly Bearish

No Trend

OBV

Mildly Bearish

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

21What is working for the Company

OPERATING CASH FLOW(Y)

Highest at HKD 304.93 MM

ROCE(HY)

Highest at 1.22%

RAW MATERIAL COST(Y)

Fallen by -166.52% (YoY

CASH AND EQV(HY)

Highest at HKD 1,686.92 MM

DEBT-EQUITY RATIO (HY)

Lowest at 101.55 %

OPERATING PROFIT(Q)

Highest at HKD 249.03 MM

OPERATING PROFIT MARGIN(Q)

Highest at 8.91 %

PRE-TAX PROFIT(Q)

Highest at HKD 43.32 MM

NET PROFIT(Q)

Highest at HKD 39.85 MM

EPS(Q)

Highest at HKD 0

-2What is not working for the Company

DEBTORS TURNOVER RATIO(HY)

Lowest at 0.99 times

NET SALES(Q)

Lowest at HKD 2,793.95 MM

Here's what is working for Honghua Group Ltd.

Pre-Tax Profit

At HKD 43.32 MM has Grown at 392.02%

Year on Year (YoY)

MOJO Watch

Near term Pre-Tax Profit trend is very positive

Pre-Tax Profit (HKD MM)

Net Profit

At HKD 39.85 MM has Grown at 979.81%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is very positive

Net Profit (HKD MM)

Operating Cash Flow

Highest at HKD 304.93 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 (HKD MM)

Operating Profit

Highest at HKD 249.03 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (HKD MM)

Operating Profit Margin

Highest at 8.91 %

in the last five periods

MOJO Watch

Company's profit margin has improved

Operating Profit to Sales

Pre-Tax Profit

Highest at HKD 43.32 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (HKD MM)

Net Profit

Highest at HKD 39.85 MM

in the last five periods

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)

Cash and Eqv

Highest at HKD 1,686.92 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Debt-Equity Ratio

Lowest at 101.55 %

in the last five Semi-Annual periods

MOJO Watch

The company has been reducing its borrowing as compared to equity capital

Debt-Equity Ratio

Raw Material Cost

Fallen by -166.52% (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

Depreciation

Highest at HKD 192.05 MM

in the last five periods

MOJO Watch

The expenditure on assets done by the company may have gone into operation

Depreciation (HKD MM)

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

Net Sales

Lowest at HKD 2,793.95 MM

in the last five periods

MOJO Watch

Near term sales trend is negative

Net Sales (HKD MM)

Debtors Turnover Ratio

Lowest at 0.99 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio