Is The Market Rewarding Hunan Development Group Co., Ltd. (SZSE:000722) With A Negative Sentiment As A Result Of Its Mixed Fundamentals?
Is The Market Rewarding Hunan Development Group Co., Ltd. (SZSE:000722) With A Negative Sentiment As A Result Of Its Mixed Fundamentals?
It is hard to get excited after looking at Hunan Development Group's (SZSE:000722) recent performance, when its stock has declined 14% over the past month. We, however decided to study the company's financials to determine if they have got anything to do with the price decline. Fundamentals usually dictate market outcomes so it makes sense to study the company's financials. Specifically, we decided to study Hunan Development Group's ROE in this article.
看了湖南发展集团(SZSE: 000722)最近的表现,很难感到兴奋,当时该集团的股票在过去一个月中下跌了14%。但是,我们决定研究公司的财务状况,以确定它们是否与价格下跌有关。基本面通常决定市场结果,因此研究公司的财务状况是有意义的。具体而言,我们决定在本文中研究湖南发展集团的投资回报率。
Return on equity or ROE is an important factor to be considered by a shareholder because it tells them how effectively their capital is being reinvested. In short, ROE shows the profit each dollar generates with respect to its shareholder investments.
股本回报率或投资回报率是股东要考虑的重要因素,因为它告诉他们资本再投资的有效性。简而言之,投资回报率显示了每美元从其股东投资中产生的利润。
See our latest analysis for Hunan Development Group
查看我们对湖南发展集团的最新分析
How Is ROE Calculated?
投资回报率是如何计算的?
ROE can be calculated by using the formula:
ROE 可以通过使用以下公式计算:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
股本回报率 = 净利润(来自持续经营)÷ 股东权益
So, based on the above formula, the ROE for Hunan Development Group is:
因此,根据上述公式,湖南发展集团的投资回报率为:
0.6% = CN¥20m ÷ CN¥3.2b (Based on the trailing twelve months to September 2023).
0.6% = 2,000万元人民币 ÷ 32亿元人民币(基于截至2023年9月的过去十二个月)。
The 'return' is the profit over the last twelve months. One way to conceptualize this is that for each CN¥1 of shareholders' capital it has, the company made CN¥0.01 in profit.
“回报” 是过去十二个月的利润。对此进行概念化的一种方法是,该公司每拥有1元人民币的股本即可获得0.01元人民币的利润。
What Has ROE Got To Do With Earnings Growth?
投资回报率与收益增长有什么关系?
We have already established that ROE serves as an efficient profit-generating gauge for a company's future earnings. Based on how much of its profits the company chooses to reinvest or "retain", we are then able to evaluate a company's future ability to generate profits. Assuming all else is equal, companies that have both a higher return on equity and higher profit retention are usually the ones that have a higher growth rate when compared to companies that don't have the same features.
我们已经确定,投资回报率是衡量公司未来收益的有效利润指标。根据公司选择再投资或 “保留” 的利润金额,我们随后能够评估公司未来的盈利能力。假设其他条件相同,与不具有相同特征的公司相比,既有更高股本回报率又更高利润保留率的公司通常是增长率更高的公司。
A Side By Side comparison of Hunan Development Group's Earnings Growth And 0.6% ROE
湖南发展集团的收益增长和0.6%的投资回报率的并排比较
It is hard to argue that Hunan Development Group's ROE is much good in and of itself. Not just that, even compared to the industry average of 7.1%, the company's ROE is entirely unremarkable. For this reason, Hunan Development Group's five year net income decline of 12% is not surprising given its lower ROE. We believe that there also might be other aspects that are negatively influencing the company's earnings prospects. For example, the business has allocated capital poorly, or that the company has a very high payout ratio.
很难说湖南发展集团的投资回报率本身就非常好。不仅如此,即使与7.1%的行业平均水平相比,该公司的投资回报率也完全不引人注目。出于这个原因,鉴于其投资回报率较低,湖南发展集团五年净收入下降12%并不奇怪。我们认为,可能还有其他方面对公司的盈利前景产生负面影响。例如,该企业的资本分配不佳,或者该公司的派息率非常高。
However, when we compared Hunan Development Group's growth with the industry we found that while the company's earnings have been shrinking, the industry has seen an earnings growth of 6.4% in the same period. This is quite worrisome.
但是,当我们将湖南发展集团的增长与该行业的增长进行比较时,我们发现,尽管该公司的收益一直在萎缩,但该行业同期的收益增长了6.4%。这非常令人担忧。
![past-earnings-growth](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240118/0-f7cc4daaf23a067c90bd4b426b562029-0-8d493e19af6b9e29c9e506fa196f9d79.png/big)
The basis for attaching value to a company is, to a great extent, tied to its earnings growth. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. This then helps them determine if the stock is placed for a bright or bleak future. If you're wondering about Hunan Development Group's's valuation, check out this gauge of its price-to-earnings ratio, as compared to its industry.
为公司附加价值的基础在很大程度上与其收益增长息息相关。投资者接下来需要确定的是,预期的收益增长或缺乏收益是否已经包含在股价中。然后,这可以帮助他们确定股票是面向光明还是暗淡的未来。如果你想知道湖南发展集团的估值,可以看看这个衡量其市盈率与行业相比的指标。
Is Hunan Development Group Using Its Retained Earnings Effectively?
湖南发展集团是否在有效使用其留存收益?
While the company did payout a portion of its dividend in the past, it currently doesn't pay a dividend. This implies that potentially all of its profits are being reinvested in the business.
尽管该公司过去确实派发了部分股息,但目前不支付股息。这意味着其所有利润可能都被再投资于该业务。
Conclusion
结论
On the whole, we feel that the performance shown by Hunan Development Group can be open to many interpretations. Even though it appears to be retaining most of its profits, given the low ROE, investors may not be benefitting from all that reinvestment after all. The low earnings growth suggests our theory correct. Wrapping up, we would proceed with caution with this company and one way of doing that would be to look at the risk profile of the business. Our risks dashboard would have the 3 risks we have identified for Hunan Development Group.
总的来说,我们认为湖南发展集团的表现可以有多种解读。尽管鉴于投资回报率低,它似乎保留了大部分利润,但投资者毕竟可能无法从所有这些再投资中受益。低收入增长表明我们的理论是正确的。总而言之,我们将谨慎对待这家公司,其中一种方法是研究该业务的风险状况。我们的风险仪表板将包含我们为湖南发展集团确定的三种风险。
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Simply Wall St 的这篇文章本质上是笼统的。我们仅使用公正的方法提供基于历史数据和分析师预测的评论,我们的文章并非旨在提供财务建议。它不构成买入或卖出任何股票的建议,也没有考虑到您的目标或财务状况。我们的目标是为您提供由基本数据驱动的长期重点分析。请注意,我们的分析可能不会考虑最新的价格敏感型公司公告或定性材料。华尔街只是没有持有上述任何股票的头寸。