Zhejiang Medicine Co., Ltd. (600216) 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

Zhejiang Medicine Co., Ltd.

Why is Zhejiang Medicine Co., Ltd. ?

Poor long term growth as Net Sales has grown by an annual rate of 5.85% and Operating profit at 29.10% over the last 5 years

The company has declared Positive results for the last 4 consecutive quarters

NET PROFIT(HY) At CNY 738.45 MM has Grown at 196.78%
OPERATING CASH FLOW(Y) Highest at CNY 1,505.77 MM
NET SALES(9M) At CNY 7,144.89 MM has Grown at 18.29%

With ROE of 12.47%, it has a very attractive valuation with a 1.20 Price to Book Value

Over the past year, while the stock has generated a return of -17.62%, its profits have risen by 278.4% ; the PEG ratio of the company is 0

Below par performance in long term as well as near term

Along with generating -17.62% 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 hold?

Overall Portfolio exposure to Zhejiang Medicine Co., Ltd. should be less than 10%
Overall Portfolio exposure to Pharmaceuticals & Biotechnology should be less than 30%

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

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

Is Zhejiang Medicine Co., Ltd. for you?

Medium Risk, High Return

Absolute

Risk Adjusted

Volatility

Zhejiang Medicine Co., Ltd.

-14.98%

1.69

25.54%

China Shanghai Composite

15.19%

1.01

14.58%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

5.85%

EBIT Growth (5y)

29.10%

EBIT to Interest (avg)

22.72

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.15

Sales to Capital Employed (avg)

0.77

Tax Ratio

15.15%

Dividend Payout Ratio

30.66%

Pledged Shares

Institutional Holding

ROCE (avg)

9.04%

ROE (avg)

7.35%

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

1.20

EV to EBIT

7.71

EV to EBITDA

5.13

EV to Capital Employed

1.24

EV to Sales

1.25

PEG Ratio

0.03

Dividend Yield

2.64%

ROCE (Latest)

16.10%

ROE (Latest)

12.47%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bearish

Dow Theory

Mildly Bullish

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

19What is working for the Company

NET PROFIT(HY)

At CNY 738.45 MM has Grown at 196.78%

OPERATING CASH FLOW(Y)

Highest at CNY 1,505.77 MM

NET SALES(9M)

At CNY 7,144.89 MM has Grown at 18.29%

ROCE(HY)

Highest at 14.03%

DEBT-EQUITY RATIO (HY)

Lowest at -14.89 %

RAW MATERIAL COST(Y)

Fallen by -40.38% (YoY

CASH AND EQV(HY)

Highest at CNY 4,768.84 MM

-3What is not working for the Company

INTEREST(Q)

At CNY 5.76 MM has Grown at 16.38%

INVENTORY TURNOVER RATIO(HY)

Lowest at 2.77%

Here's what is working for Zhejiang Medicine Co., Ltd.

Net Profit

At CNY 738.45 MM has Grown at 196.78%

Year on Year (YoY)

MOJO Watch

Net Profit trend is very positive

Net Profit (CNY MM)

Debt-Equity Ratio

Lowest at -14.89 % and Grown

In each half year in the last five Semi-Annual periods

MOJO Watch

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

Debt-Equity Ratio

Net Sales

At CNY 7,144.89 MM has Grown at 18.29%

Year on Year (YoY)

MOJO Watch

Near term sales trend is positive

Net Sales (CNY MM)

Operating Cash Flow

Highest at CNY 1,505.77 MM

in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (CNY MM)

Cash and Eqv

Highest at CNY 4,768.84 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Raw Material Cost

Fallen by -40.38% (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 Zhejiang Medicine Co., Ltd.

Interest

At CNY 5.76 MM has Grown at 16.38%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Inventory Turnover Ratio

Lowest at 2.77%

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio