ZTE Corp. () 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

Xiaomi Corp.

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ZTE Corp.

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Comba Telecom Systems Holdings Ltd.

SMIT Holdings Ltd.

Yuxing InfoTech Investment Holdings Ltd.

Why is ZTE Corp. ?

High Debt company with Weak Long Term Fundamental Strength

Poor long term growth as Net Sales has grown by an annual rate of 4.92% over the last 5 years
The company is Net-Debt Free

Flat results in Dec 23

PBT LESS OI(Q) At HKD 573 MM has Fallen at -57.9 %
DPR(Y) Lowest at 0.00 %
DEBTORS TURNOVER RATIO(HY) Lowest at 4.15 times

With ROE of 7.03%, it has a Very Expensive valuation with a 2.25 Price to Book Value

The stock is trading at a fair value compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 11.02%, its profits have fallen by -38.6%

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 Telecom - Equipment & Accessories)

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

Is ZTE Corp. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

ZTE Corp.

11.02%

0.82

55.64%

Hang Seng Hong Kong

8.76%

0.45

19.63%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

4.92%

EBIT Growth (5y)

-5.77%

EBIT to Interest (avg)

2.69

Debt to EBITDA (avg)

0.48

Net Debt to Equity (avg)

0.26

Sales to Capital Employed (avg)

1.09

Tax Ratio

10.18%

Dividend Payout Ratio

32.27%

Pledged Shares

Institutional Holding

0.12%

ROCE (avg)

10.24%

ROE (avg)

12.97%

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

2.25

EV to EBIT

76.53

EV to EBITDA

27.42

EV to Capital Employed

1.91

EV to Sales

1.52

PEG Ratio

Dividend Yield

0.27%

ROCE (Latest)

2.50%

ROE (Latest)

7.03%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bullish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Mildly Bullish

Mildly Bearish

Dow Theory

Mildly Bearish

OBV

Mildly Bullish

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

Not enough Data to analyse Financial Trend

Here's what is working for ZTE Corp.

Net Sales - Quarterly

At HKD 37,282 MM has Grown at 13.4 %

over average Net Sales of the previous four periods of HKD 32,885 MM

MOJO Watch

Near term sales trend is very positive

Net Sales (HKD MM)

Debt-Equity Ratio - Half Yearly

Lowest at -0.18 times and Fallen

each half year in the last five half yearly periods

MOJO Watch

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

Debt-Equity Ratio

Operating Cash Flow - Annually

Highest at HKD 20,655.52 MM

in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (HKD MM)

Net Sales - Quarterly

Highest at HKD 37,282 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (HKD MM)

Cash and Cash Equivalents - Half Yearly

Highest at HKD 86,476.50 MM

in the last six half yearly periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents (HKD MM)

Inventory Turnover Ratio- Half Yearly

Highest at 3.00 times

in the last five half yearly periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Here's what is not working for ZTE Corp.

Profit Before Tax less Other Income (PBT) - Quarterly

At HKD 573 MM has Fallen at -57.9 %

over average PBT of the previous four periods of HKD 1,360 MM

MOJO Watch

Near term PBT trend is very negative

PBT less Other Income (HKD MM)

Non Operating Income - Quarterly

is 74.04 % of Profit Before Tax (PBT)

MOJO Watch

The company's income from non business activities is high; which is not a sustainable business model

Non Operating Income to PBT (HKD MM)

Debtors Turnover Ratio- Half Yearly

Lowest at 4.15 times

in the last five half yearly periods

MOJO Watch

Company's pace of settling its Debtors has slowed

Debtors Turnover Ratio

Dividend Payout Ratio (DPR) - Annually

Lowest at 0.00 %

in the last five years

MOJO Watch

Company is distributing lower proportion of profits generated as dividend

DPR (%)