Wencan Group Co. Ltd. (603348) 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

Wencan Group Co. Ltd.

Why is Wencan Group Co. Ltd. ?

High Debt Company with a Debt to Equity ratio (avg) at times

Poor long term growth as Net Sales has grown by an annual rate of 25.26% and Operating profit at -13.28% 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 3.87% signifying low profitability per unit of shareholders funds

Poor long term growth as Net Sales has grown by an annual rate of 25.26% and Operating profit at -13.28% over the last 5 years

With a fall in Net Sales of -0.36%, the company declared Very Negative results in Sep 25

The company has declared negative results for the last 2 consecutive quarters
OPERATING CASH FLOW(Y) Lowest at CNY 338.28 MM
PRE-TAX PROFIT(Q) At CNY 4.49 MM has Fallen at -78.04%
ROCE(HY) Lowest at 0.48%

With ROE of 1.08%, it has a expensive valuation with a 1.61 Price to Book Value

Over the past year, while the stock has generated a return of -17.28%, its profits have fallen by -60.8%
At the current price, the company has a high dividend yield of 1.1

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -17.28% returns in the last 1 year, the stock has also underperformed China Shanghai Composite in each of the last 3 annual periods

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 Auto Components & Equipments)

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

Is Wencan Group Co. Ltd. for you?

Medium Risk, Low Return

Absolute

Risk Adjusted

Volatility

Wencan Group Co. Ltd.

-20.81%

-1.28

27.04%

China Shanghai Composite

15.17%

1.58

14.20%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

25.26%

EBIT Growth (5y)

-13.28%

EBIT to Interest (avg)

2.46

Debt to EBITDA (avg)

2.59

Net Debt to Equity (avg)

0.39

Sales to Capital Employed (avg)

0.91

Tax Ratio

35.00%

Dividend Payout Ratio

81.99%

Pledged Shares

Institutional Holding

ROCE (avg)

4.60%

ROE (avg)

3.87%

Valuation

Valuation Scorecard

Valuation grade scale :

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

Valuation Key Factors

Factor

Value

P/E Ratio

149

Industry P/E

Price to Book Value

1.61

EV to EBIT

69.43

EV to EBITDA

11.47

EV to Capital Employed

1.43

EV to Sales

1.48

PEG Ratio

Dividend Yield

1.14%

ROCE (Latest)

2.06%

ROE (Latest)

1.08%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bullish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Mildly Bullish

Dow Theory

Mildly Bearish

OBV

Mildly 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

0What is working for the Company

NO KEY POSITIVE TRIGGERS

-27What is not working for the Company

OPERATING CASH FLOW(Y)

Lowest at CNY 338.28 MM

PRE-TAX PROFIT(Q)

At CNY 4.49 MM has Fallen at -78.04%

ROCE(HY)

Lowest at 0.48%

INTEREST COVERAGE RATIO(Q)

Lowest at 89.51

RAW MATERIAL COST(Y)

Grown by 17.7% (YoY

INVENTORY TURNOVER RATIO(HY)

Lowest at 6.71 times

OPERATING PROFIT(Q)

Lowest at CNY 20.5 MM

OPERATING PROFIT MARGIN(Q)

Lowest at 1.34 %

NET PROFIT(Q)

Lowest at CNY -10.75 MM

EPS(Q)

Lowest at CNY -0.03

Here's what is not working for Wencan Group Co. Ltd.

Pre-Tax Profit

At CNY 4.49 MM has Fallen at -78.04%

over average net sales of the previous four periods of CNY 20.44 MM

MOJO Watch

Near term Pre-Tax Profit trend is very negative

Pre-Tax Profit (CNY MM)

Net Profit

At CNY -10.75 MM has Fallen at -192.78%

over average net sales of the previous four periods of CNY 11.59 MM

MOJO Watch

Near term Net Profit trend is very negative

Net Profit (CNY MM)

Operating Cash Flow

Lowest at CNY 338.28 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 Coverage Ratio

Lowest at 89.51

in the last five periods

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Operating Profit

Lowest at CNY 20.5 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is negative

Operating Profit (CNY MM)

Operating Profit Margin

Lowest at 1.34 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Net Profit

Lowest at CNY -10.75 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (CNY MM)

EPS

Lowest at CNY -0.03

in the last five periods

MOJO Watch

Declining profitability; company has created lower earnings for shareholders

EPS (CNY)

Inventory Turnover Ratio

Lowest at 6.71 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio

Raw Material Cost

Grown by 17.7% (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