Capital Allocation Trends At Long Yuan Construction Group (SHSE:600491) Aren't Ideal
Capital Allocation Trends At Long Yuan Construction Group (SHSE:600491) Aren't Ideal
If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and secondly, an expanding base of capital employed. This shows us that it's a compounding machine, able to continually reinvest its earnings back into the business and generate higher returns. However, after briefly looking over the numbers, we don't think Long Yuan Construction Group (SHSE:600491) has the makings of a multi-bagger going forward, but let's have a look at why that may be.
如果我們想找到一支可以長期倍增的股票,我們應該尋找哪些潛在的趨勢?首先,我們想看到資本僱用回報(ROCE)得到證明並且不斷增長,並且其資本僱用基礎擴大。這表明它是一個複利機器,能夠不斷將其盈利再投資到業務中,並且產生更高的回報。然而,經過簡短地瀏覽了數字,我們認爲龍元建設(SHSE:600491)未來不具備多倍增長的潛力,但是讓我們看看爲什麼。
Return On Capital Employed (ROCE): What Is It?
資本僱用回報率(ROCE)是什麼?
For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. The formula for this calculation on Long Yuan Construction Group is:
對於那些不確定ROCE是什麼的人,它衡量的是公司可以從其業務所僱用的資本中產生的稅前利潤的數量。龍元建設集團的這個計算公式是:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
資產僱用回報率(ROCE)是指企業利潤,即企業稅前利潤除以企業投入的總資本(負債加股權)。如果ROCE高於企業財務成本的承受能力,那麼企業就會創造出更多的價值。
0.025 = CN¥746m ÷ (CN¥57b - CN¥28b) (Based on the trailing twelve months to March 2024).
0.025 = CN¥74600萬 ÷ (CN¥570億 - CN¥28億)(基於截至2024年3月的過去12個月)。
Therefore, Long Yuan Construction Group has an ROCE of 2.5%. Ultimately, that's a low return and it under-performs the Construction industry average of 6.5%.
因此,龍元建設集團ROCE爲2.5%。最終,這是一個低迴報,表現不如施工行業的平均水平6.5%。
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Historical performance is a great place to start when researching a stock so above you can see the gauge for Long Yuan Construction Group's ROCE against it's prior returns. If you want to delve into the historical earnings , check out these free graphs detailing revenue and cash flow performance of Long Yuan Construction Group.
歷史表現是研究股票的好起點,因此您可以看到龍元建設集團的ROCE與其以往回報的比較。如果您想深入研究歷史收益,請查看這些免費圖表,詳細介紹龍元建設集團的營業收入和現金流表現。
What The Trend Of ROCE Can Tell Us
儘管如此,當我們看 enphase energy (納斯達克股票代碼:ENPH) 的時候,它似乎並沒有完全符合這些要求。
We weren't thrilled with the trend because Long Yuan Construction Group's ROCE has reduced by 61% over the last five years, while the business employed 39% more capital. However, some of the increase in capital employed could be attributed to the recent capital raising that's been completed prior to their latest reporting period, so keep that in mind when looking at the ROCE decrease. Long Yuan Construction Group probably hasn't received a full year of earnings yet from the new funds it raised, so these figures should be taken with a grain of salt.
我們對這個趨勢並不滿意,因爲龍元建設集團的ROCE在過去五年中減少了61%,同時業務的資本僱用增加了39%。然而,業務增加的部分資本僱用可以歸因於最新報告期前完成的資本籌集,因此在看到ROCE下降時,請記住這一點。龍元建設集團可能還沒有從發行新基金中獲得全年收益,因此這些數字應該以適當的懷疑態度看待。
On a related note, Long Yuan Construction Group has decreased its current liabilities to 49% of total assets. So we could link some of this to the decrease in ROCE. Effectively this means their suppliers or short-term creditors are funding less of the business, which reduces some elements of risk. Since the business is basically funding more of its operations with it's own money, you could argue this has made the business less efficient at generating ROCE. Either way, they're still at a pretty high level, so we'd like to see them fall further if possible.
另外,龍元建設集團將其流動負債降低到總資產的49%。因此,我們可以將ROCE的降低與此聯繫起來,這實質上意味着其供應商或短期債權人爲業務提供的資金較少,從而降低了某些風險因素。由於業務基本上使用自己的資金資助其運營,可以說這使得業務在產生ROCE方面不那麼高效。無論哪種方式,它們的ROCE仍然處於相當高的水平,因此我們希望看到它們進一步下降(如果可能的話)。
Our Take On Long Yuan Construction Group's ROCE
我們對龍元建設集團的ROCE的看法
From the above analysis, we find it rather worrisome that returns on capital and sales for Long Yuan Construction Group have fallen, meanwhile the business is employing more capital than it was five years ago. It should come as no surprise then that the stock has fallen 57% over the last five years, so it looks like investors are recognizing these changes. Unless there is a shift to a more positive trajectory in these metrics, we would look elsewhere.
從上面的分析中,我們發現龍元建設集團的資本和銷售回報率下降,同時業務所使用的資本比五年前增加了。因此,股票在過去五年中下跌了57%,因此投資者認識到了這些變化,這並不令人驚訝。除非這些指標有更積極的趨勢轉變,否則我們將尋找其他投資機會。
Long Yuan Construction Group does have some risks though, and we've spotted 2 warning signs for Long Yuan Construction Group that you might be interested in.
龍元建設集團確實存在一些風險,我們已經發現了2個關於龍元建設集團的警示信號,您可能會感興趣。
While Long Yuan Construction Group isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets.
雖然龍元建設集團沒有獲得最高的回報,請查看此免費的公司列表,這些公司在實現堅實資產負債表的同時獲得高回報率。
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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.
對本文有任何反饋?對內容有任何疑慮?請直接與我們聯繫。或者,發送電子郵件至editorial-team@simplywallst.com。
這篇文章是Simply Wall St的一般性文章。我們根據歷史數據和分析師預測提供評論,只使用公正的方法論,我們的文章並不意味着提供任何金融建議。文章不構成買賣任何股票的建議,也不考慮您的目標或您的財務狀況。我們的目標是帶給您基本數據驅動的長期關注分析。請注意,我們的分析可能不考慮最新的價格敏感公司公告或定性材料。Simply Wall St沒有任何股票頭寸。
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
對本文有任何反饋?對內容有任何疑慮?請直接與我們聯繫。或者,發送電子郵件至editorial-team@simplywallst.com。