Zhejiang Three Stars New Materials Co., Ltd. (603578) 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 Three Stars New Materials Co., Ltd.

Why is Zhejiang Three Stars New Materials Co., Ltd. ?

Poor long term growth as Net Sales has grown by an annual rate of 29.13% and Operating profit at -228.32% over the last 5 years

The company has declared Negative results for the last 7 consecutive quarters

NET PROFIT(9M) At CNY -113.05 MM has Grown at -487.02%
OPERATING CASH FLOW(Y) Lowest at CNY 38.92 MM
ROCE(HY) Lowest at -7.12%

Risky -

The stock is trading risky as compared to its average historical valuations
Over the past year, while the stock has generated a return of -12.32%, its profits have fallen by -534.7%
At the current price, the company has a high dividend yield of 0

Below par performance in long term as well as near term

Along with generating -12.32% 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 Building Products)

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

Is Zhejiang Three Stars New Materials Co., Ltd. for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

Zhejiang Three Stars New Materials Co., Ltd.

-10.42%

0.15

41.21%

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)

29.13%

EBIT Growth (5y)

-228.32%

EBIT to Interest (avg)

9.86

Debt to EBITDA (avg)

0.42

Net Debt to Equity (avg)

1.69

Sales to Capital Employed (avg)

0.52

Tax Ratio

10.59%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

ROCE (avg)

7.33%

ROE (avg)

8.18%

Valuation

Valuation Scorecard

Valuation grade scale :

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

Valuation Key Factors

Factor

Value

P/E Ratio

NA (Loss Making)

Industry P/E

Price to Book Value

2.34

EV to EBIT

-19.32

EV to EBITDA

-45.47

EV to Capital Employed

1.52

EV to Sales

3.10

PEG Ratio

Dividend Yield

ROCE (Latest)

-7.85%

ROE (Latest)

-22.37%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Bullish

Dow Theory

Mildly Bullish

No Trend

OBV

Mildly Bullish

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

15What is working for the Company

PRE-TAX PROFIT(Q)

At CNY 8.55 MM has Grown at 133.9%

NET PROFIT(Q)

At CNY 10 MM has Grown at 160.54%

DEBTORS TURNOVER RATIO(HY)

Highest at 2.13%

NET SALES(Q)

Highest at CNY 365.24 MM

-26What is not working for the Company

NET PROFIT(9M)

At CNY -113.05 MM has Grown at -487.02%

OPERATING CASH FLOW(Y)

Lowest at CNY 38.92 MM

ROCE(HY)

Lowest at -7.12%

RAW MATERIAL COST(Y)

Grown by 40.78% (YoY

DEBT-EQUITY RATIO (HY)

Highest at 168.63 %

INVENTORY TURNOVER RATIO(HY)

Lowest at 4.76%

INTEREST(Q)

Highest at CNY 18.96 MM

Here's what is working for Zhejiang Three Stars New Materials Co., Ltd.

Net Sales

At CNY 365.24 MM has Grown at 45.95%

over average net sales of the previous four periods of CNY 250.24 MM

MOJO Watch

Near term sales trend is very positive

Net Sales (CNY MM)

Pre-Tax Profit

At CNY 8.55 MM has Grown at 133.9%

over average net sales of the previous four periods of CNY -25.23 MM

MOJO Watch

Near term Pre-Tax Profit trend is very positive

Pre-Tax Profit (CNY MM)

Net Profit

At CNY 10 MM has Grown at 160.54%

over average net sales of the previous four periods of CNY -16.52 MM

MOJO Watch

Near term Net Profit trend is very positive

Net Profit (CNY MM)

Net Sales

Highest at CNY 365.24 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (CNY MM)

Debtors Turnover Ratio

Highest at 2.13%

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its Debtors faster

Debtors Turnover Ratio

Here's what is not working for Zhejiang Three Stars New Materials Co., Ltd.

Operating Cash Flow

Lowest at CNY 38.92 MM

in the last three years

MOJO Watch

The company's cash revenues from business operations are falling

Operating Cash Flows (CNY MM)

Interest

Highest at CNY 18.96 MM

in the last five periods and Increased by 7.48% (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CNY MM)

Debt-Equity Ratio

Highest at 168.63 %

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

Inventory Turnover Ratio

Lowest at 4.76%

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 40.78% (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

Non Operating Income

Highest at CNY 1 MM

in the last five periods

MOJO Watch

Increased income from non business activities may not be sustainable

Non Operating income