Shenzhen Zhongheng Huafa Co., Ltd. (000020) 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

Shenzhen Zhongheng Huafa Co., Ltd.

Why is Shenzhen Zhongheng Huafa Co., Ltd. ?

Poor Management Efficiency with a low ROCE of 4.20%

The company has been able to generate a Return on Capital Employed (avg) of 4.20% 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 0.10% and Operating profit at 11.51% over the last 5 years

With a fall in Net Sales of -12.71%, the company declared Very Negative results in Mar 26

The company has declared negative results for the last 2 consecutive quarters
The company has declared negative results in Dec 25 after 5 consecutive negative quarters
INTEREST(9M) At CNY 0 MM has Grown at inf%
OPERATING CASH FLOW(Y) Lowest at CNY 56.07 MM
NET SALES(Q) Lowest at CNY 152.71 MM

With ROE of 7.81%, it has a very expensive valuation with a 4.84 Price to Book Value

Over the past year, while the stock has generated a return of -14.73%, its profits have fallen by -6.9%

Below par performance in long term as well as near term

Along with generating -14.73% returns in the last 1 year, the stock has also underperformed China Shanghai Composite in the last 3 years, 1 year and 3 months

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 IT - Hardware)

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

Is Shenzhen Zhongheng Huafa Co., Ltd. for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

Shenzhen Zhongheng Huafa Co., Ltd.

-15.35%

0.28

50.96%

China Shanghai Composite

23.91%

1.73

13.79%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

0.10%

EBIT Growth (5y)

11.51%

EBIT to Interest (avg)

7.09

Debt to EBITDA (avg)

0.60

Net Debt to Equity (avg)

-0.17

Sales to Capital Employed (avg)

1.69

Tax Ratio

9.21%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

ROCE (avg)

4.20%

ROE (avg)

4.25%

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

4.84

EV to EBIT

46.00

EV to EBITDA

39.07

EV to Capital Employed

6.25

EV to Sales

2.54

PEG Ratio

Dividend Yield

ROCE (Latest)

13.58%

ROE (Latest)

7.81%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Mildly Bearish

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Bullish

Dow Theory

Mildly Bearish

OBV

No Trend

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

3What is working for the Company

RAW MATERIAL COST(Y)

Fallen by -56.36% (YoY

CASH AND EQV(HY)

Highest at CNY 394.61 MM

DEBT-EQUITY RATIO (HY)

Lowest at -26.8 %

-24What is not working for the Company

INTEREST(9M)

At CNY 0 MM has Grown at inf%

OPERATING CASH FLOW(Y)

Lowest at CNY 56.07 MM

NET SALES(Q)

Lowest at CNY 152.71 MM

PRE-TAX PROFIT(Q)

Lowest at CNY 6.62 MM

NET PROFIT(Q)

Lowest at CNY 5.2 MM

EPS(Q)

Lowest at CNY 0.02

Here's what is working for Shenzhen Zhongheng Huafa Co., Ltd.

Cash and Eqv

Highest at CNY 394.61 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Debt-Equity Ratio

Lowest at -26.8 %

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 -56.36% (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 Shenzhen Zhongheng Huafa Co., Ltd.

Interest

At CNY 0 MM has Grown at inf%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Net Sales

At CNY 152.71 MM has Fallen at -28.7%

over average net sales of the previous four periods of CNY 214.18 MM

MOJO Watch

Near term sales trend is extremely negative

Net Sales (CNY MM)

Operating Cash Flow

Lowest at CNY 56.07 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)

Net Sales

Lowest at CNY 152.71 MM

in the last five periods

MOJO Watch

Near term sales trend is negative

Net Sales (CNY MM)

Pre-Tax Profit

Lowest at CNY 6.62 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (CNY MM)

Pre-Tax Profit

At CNY 6.62 MM has Fallen at -40.73%

over average net sales of the previous four periods of CNY 11.17 MM

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (CNY MM)

Net Profit

Lowest at CNY 5.2 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (CNY MM)

Net Profit

At CNY 5.2 MM has Fallen at -41.28%

over average net sales of the previous four periods of CNY 8.86 MM

MOJO Watch

Near term Net Profit trend is negative

Net Profit (CNY MM)

EPS

Lowest at CNY 0.02

in the last five periods

MOJO Watch

Declining profitability; company has created lower earnings for shareholders

EPS (CNY)