Nanjing Hanrui CobaltLtd (SZSE:300618) has had a rough three months with its share price down 16%. It is possible that the markets have ignored the company's differing financials and decided to lean-in to the negative sentiment. Stock prices are usually driven by a company's financial performance over the long term, and therefore we decided to pay more attention to the company's financial performance. Specifically, we decided to study Nanjing Hanrui CobaltLtd's ROE in this article.
Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. In simpler terms, it measures the profitability of a company in relation to shareholder's equity.
View our latest analysis for Nanjing Hanrui CobaltLtd
How Is ROE Calculated?
The formula for ROE is:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
So, based on the above formula, the ROE for Nanjing Hanrui CobaltLtd is:
8.3% = CN¥430m ÷ CN¥5.2b (Based on the trailing twelve months to September 2022).
The 'return' is the profit over the last twelve months. Another way to think of that is that for every CN¥1 worth of equity, the company was able to earn CN¥0.08 in profit.
Why Is ROE Important For Earnings Growth?
So far, we've learned that ROE is a measure of a company's profitability. We now need to evaluate how much profit the company reinvests or "retains" for future growth which then gives us an idea about the growth potential of the company. 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.
Nanjing Hanrui CobaltLtd's Earnings Growth And 8.3% ROE
When you first look at it, Nanjing Hanrui CobaltLtd's ROE doesn't look that attractive. However, its ROE is similar to the industry average of 8.3%, so we won't completely dismiss the company. Still, Nanjing Hanrui CobaltLtd has seen a flat net income growth over the past five years. Remember, the company's ROE is not particularly great to begin with. So that could also be one of the reasons behind the company's flat growth in earnings.
Next, on comparing with the industry net income growth, we found that Nanjing Hanrui CobaltLtd's reported growth was lower than the industry growth of 18% in the same period, which is not something we like to see.
![past-earnings-growth](https://usnewsfile.futunn.com/pic/0-17160415-0-dbaf57c54dc09486b2868a0be03f740a.png/big)
SZSE:300618 Past Earnings Growth November 26th 2022
Earnings growth is an important metric to consider when valuing a stock. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. By doing so, they will have an idea if the stock is headed into clear blue waters or if swampy waters await. One good indicator of expected earnings growth is the P/E ratio which determines the price the market is willing to pay for a stock based on its earnings prospects. So, you may want to check if Nanjing Hanrui CobaltLtd is trading on a high P/E or a low P/E, relative to its industry.
Is Nanjing Hanrui CobaltLtd Using Its Retained Earnings Effectively?
Nanjing Hanrui CobaltLtd's low three-year median payout ratio of 15% (implying that the company keeps85% of its income) should mean that the company is retaining most of its earnings to fuel its growth and this should be reflected in its growth number, but that's not the case.
In addition, Nanjing Hanrui CobaltLtd has been paying dividends over a period of five years suggesting that keeping up dividend payments is way more important to the management even if it comes at the cost of business growth.
Summary
In total, we're a bit ambivalent about Nanjing Hanrui CobaltLtd's performance. While the company does have a high rate of profit retention, its low rate of return is probably hampering its earnings growth. So far, we've only made a quick discussion around the company's earnings growth. You can do your own research on Nanjing Hanrui CobaltLtd and see how it has performed in the past by looking at this FREE detailed graph of past earnings, revenue and cash flows.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
南京漢瑞股份有限公司(SZSE:300618)經歷了艱難的三個月,股價下跌了16%。市場可能忽視了該公司不同的財務狀況,決定向負面情緒傾斜。股票價格通常是由公司的長期財務表現推動的,因此我們決定更多地關注公司的財務表現。具體地説,我們決定在本文中研究南京漢瑞股份有限公司的淨資產收益率。
股本回報率(ROE)是用來評估公司管理層利用公司資本效率的關鍵指標。簡而言之,它衡量的是一家公司相對於股東權益的盈利能力。
查看我們對南京漢瑞科博特有限公司的最新分析
淨資產收益率是如何計算的?
這個淨資產收益率公式是:
股本回報率=(持續經營的)淨利潤?股東權益
因此,根據上述公式,南京漢瑞股份有限公司的淨資產收益率為:
8.3%=4.3億元×52億元(以截至2022年9月的12個月為基礎)。
“收益”是過去12個月的利潤。另一種説法是,公司每持有價值1元的股權,就能賺取0.08元的利潤。
為什麼淨資產收益率對收益增長很重要?
到目前為止,我們瞭解到淨資產收益率是衡量一家公司盈利能力的指標。我們現在需要評估公司將多少利潤再投資或“保留”用於未來的增長,這就讓我們對公司的增長潛力有了一個瞭解。假設其他條件相同,與沒有相同特徵的公司相比,擁有更高股本回報率和更高利潤保留率的公司通常會有更高的增長率。
南京漢瑞科博特盈利增長8.3%淨資產收益率
乍一看,南京漢瑞股份有限公司的淨資產收益率(ROE)看起來並不那麼吸引人。不過,其淨資產收益率接近8.3%的行業平均水平,因此我們不會完全對該公司不屑一顧。儘管如此,南京漢瑞科博特有限公司在過去五年中淨利潤增長持平。請記住,該公司的淨資產收益率從一開始就不是特別高。因此,這也可能是該公司盈利增長持平的原因之一。
接下來,對比行業淨收入增長,我們發現南京漢瑞股份有限公司的報告增長低於同期行業18%的增長,這是我們不願意看到的。
![past-earnings-growth](https://usnewsfile.futunn.com/pic/0-17160415-0-dbaf57c54dc09486b2868a0be03f740a.png/big)
深圳證交所:過去300618的收益增長2022年11月26日
盈利增長是評估一隻股票時需要考慮的一個重要指標。投資者下一步需要確定的是,預期的收益增長是否已經計入了股價。通過這樣做,他們將知道股票是將進入清澈的藍色水域,還是等待沼澤水域。衡量預期收益增長的一個很好的指標是市盈率,它根據一隻股票的盈利前景決定市場願意為其支付的價格。因此,你可能想看看南京漢瑞科技有限公司的市盈率相對於其行業是高市盈率還是低市盈率。
南京漢瑞科技有限公司是否有效地利用了其留存收益?
南京漢瑞科技股份有限公司較低的三年派息率中值為15%(這意味着該公司保留了85%的收入),這應該意味着該公司將保留大部分收益來推動其增長,這應該反映在其增長數據中,但事實並非如此。
此外,南京漢瑞股份有限公司在過去五年裏一直在發放股息,這表明繼續支付股息對管理層來説要重要得多,即使這是以業務增長為代價的。
摘要
總體而言,我們對南京漢瑞股份有限公司的表現有點矛盾。雖然該公司的利潤留存率確實很高,但其低迴報率可能正在阻礙其收益增長。到目前為止,我們只是圍繞該公司的收益增長進行了簡短的討論。你可以自己研究南京漢瑞科技有限公司,看看它在過去的表現如何,通過查看這個免費的詳細圖表過去的收益、收入和現金流。
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本文由Simply Wall St.撰寫,具有概括性。我們僅使用不偏不倚的方法提供基於歷史數據和分析師預測的評論,我們的文章並不打算作為財務建議。它不構成買賣任何股票的建議,也沒有考慮你的目標或你的財務狀況。我們的目標是為您帶來由基本面數據驅動的長期重點分析。請注意,我們的分析可能不會將最新的對價格敏感的公司公告或定性材料考慮在內。Simply Wall St.對上述任何一隻股票都沒有持倉。