Huarong Chemical 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

Huarong Chemical Co., Ltd.

Why is Huarong Chemical Co., Ltd. ?

Poor long term growth as Net Sales has grown by an annual rate of 24.08% and Operating profit at -12.57% over the last 5 years

The company has declared Negative results for the last 3 consecutive quarters

OPERATING CASH FLOW(Y) Lowest at CNY 16.22 MM
ROCE(HY) Lowest at 5.25%
INTEREST(Q) At CNY 1.6 MM has Grown at 15.16%

With ROE of 5.37%, it has a attractive valuation with a 0.67 Price to Book Value

Over the past year, while the stock has generated a return of 35.11%, its profits have fallen by -37.4%

Market Beating Performance

The stock has generated a return of 35.11% in the last 1 year, much higher than market (China Shanghai Composite) returns of 15.18%

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Huarong Chemical Co., Ltd. should be less than 10%
Overall Portfolio exposure to Chemicals & Petrochemicals should be less than 30%

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

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

Is Huarong Chemical Co., Ltd. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

Huarong Chemical Co., Ltd.

85.4%

1.19

60.98%

China Shanghai Composite

15.19%

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)

24.08%

EBIT Growth (5y)

-12.57%

EBIT to Interest (avg)

18.82

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.66

Sales to Capital Employed (avg)

0.52

Tax Ratio

10.95%

Dividend Payout Ratio

81.18%

Pledged Shares

Institutional Holding

ROCE (avg)

17.67%

ROE (avg)

6.84%

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

0.67

EV to EBIT

3.42

EV to EBITDA

1.95

EV to Capital Employed

0.25

EV to Sales

0.12

PEG Ratio

Dividend Yield

ROCE (Latest)

7.19%

ROE (Latest)

5.37%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

Bearish

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Bullish

Dow Theory

Bullish

OBV

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

11What is working for the Company

DIVIDEND PAYOUT RATIO(Y)

Highest at 111.73%

NET SALES(9M)

Higher at CNY 1,146.92 MM

INVENTORY TURNOVER RATIO(HY)

Highest at 22.04%

OPERATING PROFIT(Q)

Highest at CNY 24.35 MM

-10What is not working for the Company

OPERATING CASH FLOW(Y)

Lowest at CNY 16.22 MM

ROCE(HY)

Lowest at 5.25%

INTEREST(Q)

At CNY 1.6 MM has Grown at 15.16%

RAW MATERIAL COST(Y)

Grown by 32.17% (YoY

DEBT-EQUITY RATIO (HY)

Highest at -56.78 %

NET PROFIT(Q)

At CNY 17.29 MM has Fallen at -29.38%

Here's what is working for Huarong Chemical Co., Ltd.

Net Sales

At CNY 765.62 MM has Grown at 48.71%

Year on Year (YoY)

MOJO Watch

Near term sales trend is very positive

Net Sales (CNY MM)

Operating Profit

Highest at CNY 24.35 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (CNY MM)

Inventory Turnover Ratio

Highest at 22.04%

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Dividend Payout Ratio

Highest at 111.73%

in the last five years

MOJO Watch

Company is distributing higher proportion of profits generated as dividend

DPR (%)

Here's what is not working for Huarong Chemical Co., Ltd.

Operating Cash Flow

Lowest at CNY 16.22 MM and Fallen

In each year in the last three years

MOJO Watch

The company's cash revenues from business operations are falling

Operating Cash Flows (CNY MM)

Interest

At CNY 1.6 MM has Grown at 15.16%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Net Profit

At CNY 17.29 MM has Fallen at -29.38%

over average net sales of the previous four periods of CNY 24.48 MM

MOJO Watch

Near term Net Profit trend is negative

Net Profit (CNY MM)

Debt-Equity Ratio

Highest at -56.78 %

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

Raw Material Cost

Grown by 32.17% (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