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Does Guangdong Investment Limited's (HKG:270) Weak Fundamentals Mean That The Market Could Correct Its Share Price?

Does Guangdong Investment Limited's (HKG:270) Weak Fundamentals Mean That The Market Could Correct Its Share Price?

廣東投資有限公司(HKG:270)的基本面疲弱是否意味着市場可能會修正其股價?
Simply Wall St ·  2024/12/16 14:15

Guangdong Investment (HKG:270) has had a great run on the share market with its stock up by a significant 41% over the last three months. However, in this article, we decided to focus on its weak fundamentals, as long-term financial performance of a business is what ultimately dictates market outcomes. In this article, we decided to focus on Guangdong Investment's ROE.

廣東投資(HKG:270)在股市上表現出色,過去三個月其股票上漲了41%。然而,在本文中,我們決定關注其疲弱的基本面,因爲企業的長期財務表現最終決定了市場結果。本文我們決定聚焦於廣東投資的ROE。

Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors' money. Put another way, it reveals the company's success at turning shareholder investments into profits.

股東權益回報率(ROE)是測試公司如何有效地增加其價值和管理投資者資金的指標。換句話說,它揭示了公司將股東投資轉化爲利潤的成功程度。

How Do You Calculate Return On Equity?

如何計算股本回報率?

Return on equity can be calculated by using the formula:

淨資產收益率可以通過以下公式計算:

Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity

股東權益回報率 = 淨利潤(來自持續運營)÷ 股東權益

So, based on the above formula, the ROE for Guangdong Investment is:

因此,基於上述公式,廣東投資的ROE爲:

4.4% = HK$2.6b ÷ HK$59b (Based on the trailing twelve months to September 2024).

4.4% = HK$26億 ÷ HK$590億(基於截至2024年9月的過去十二個月)。

The 'return' refers to a company's earnings over the last year. So, this means that for every HK$1 of its shareholder's investments, the company generates a profit of HK$0.04.

'回報'指的是公司過去一年的收益。因此,這意味着每投資1港元,股東便能獲得0.04港元的利潤。

Why Is ROE Important For Earnings Growth?

ROE爲什麼對淨利潤增長很重要?

Thus far, we have learned that ROE measures how efficiently a company is generating its profits. Depending on how much of these profits the company reinvests or "retains", and how effectively it does so, we are then able to assess a company's earnings growth potential. Assuming everything else remains unchanged, the higher the ROE and profit retention, the higher the growth rate of a company compared to companies that don't necessarily bear these characteristics.

到目前爲止,我們已經了解到roe衡量公司生成利潤的效率。根據公司再投資或「保留」的利潤比例及其有效性,我們能夠評估公司的收益增長潛力。在其他一切保持不變的情況下,roe和利潤保留率越高,公司的增長率就越高,相比於那些不一定擁有這些特性的公司。

A Side By Side comparison of Guangdong Investment's Earnings Growth And 4.4% ROE

廣東投資的收益增長與4.4% ROE的並排比較

At first glance, Guangdong Investment's ROE doesn't look very promising. A quick further study shows that the company's ROE doesn't compare favorably to the industry average of 5.8% either. For this reason, Guangdong Investment's five year net income decline of 8.6% is not surprising given its lower ROE. We reckon that there could also be other factors at play here. For example, it is possible that the business has allocated capital poorly or that the company has a very high payout ratio.

乍一看,廣東投資的ROE似乎並不令人鼓舞。 進一步的快速研究顯示,該公司的ROE與行業平均水平5.8%相比也不太理想。 因此,考慮到其較低的ROE,廣東投資五年的淨利潤下降8.6%並不令人驚訝。 我們認爲,這裏可能還有其他因素在起作用。 例如,可能是該企業資本配置不當,或者公司有很高的分紅派息比率。

As a next step, we compared Guangdong Investment's performance with the industry and found thatGuangdong Investment's performance is depressing even when compared with the industry, which has shrunk its earnings at a rate of 4.4% in the same period, which is a slower than the company.

作爲下一步,我們將廣東投資的表現與行業進行了比較,發現廣東投資的表現即使與同一時期收益縮減4.4%的行業相比也相當令人失望,這比公司表現得更慢。

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SEHK:270 Past Earnings Growth December 16th 2024
SEHK:270 過去的收益增長 2024年12月16日

The basis for attaching value to a company is, to a great extent, tied to its earnings growth. The investor should try to establish if the expected growth or decline in earnings, whichever the case may be, is priced in. Doing so will help them establish if the stock's future looks promising or ominous. Is Guangdong Investment fairly valued compared to other companies? These 3 valuation measures might help you decide.

給公司估值的基礎在很大程度上與其盈利增長相關。投資者應該試圖確定預期的盈利增長或下降,無論是哪種情況,是否已經反映在價格中。這樣做將幫助他們確定股票的未來是看漲還是看跌。 廣東投資相對於其他公司是否被公正估值?以下三個估值指標可能會幫助你做出決定。

Is Guangdong Investment Making Efficient Use Of Its Profits?

廣東投資是否有效地利用了其利潤?

With a high three-year median payout ratio of 82% (implying that 18% of the profits are retained), most of Guangdong Investment's profits are being paid to shareholders, which explains the company's shrinking earnings. With only a little being reinvested into the business, earnings growth would obviously be low or non-existent. You can see the 4 risks we have identified for Guangdong Investment by visiting our risks dashboard for free on our platform here.

廣東投資的三年中位數派息率高達82%(意味着18%的利潤被留存),大部分的利潤都被支付給股東,這也解釋了公司盈利的減少。因爲只有少量被再投資於業務,盈利增長顯然會很低或根本不存在。你可以通過訪問我們平台上的風險儀表板,免費查看我們爲廣東投資確定的4個風險。

In addition, Guangdong Investment has been paying dividends over a period of at least ten years suggesting that keeping up dividend payments is way more important to the management even if it comes at the cost of business growth.

此外,廣東投資在至少十年的時間裏一直在派發分紅,這表明保持分紅支付對管理層來說比業務增長更重要,即使這可能會影響到業務的增長。

Conclusion

結論

Overall, we would be extremely cautious before making any decision on Guangdong Investment. The company has seen a lack of earnings growth as a result of retaining very little profits and whatever little it does retain, is being reinvested at a very low rate of return. That being so, the latest industry analyst forecasts show that the analysts are expecting to see a huge improvement in the company's earnings growth rate. Are these analysts expectations based on the broad expectations for the industry, or on the company's fundamentals? Click here to be taken to our analyst's forecasts page for the company.

總體而言,在對廣東投資做出任何決策之前,我們會非常謹慎。該公司由於保留的利潤非常少,因此盈利增長乏力,而保留的利潤又以非常低的回報率進行再投資。儘管如此,最新的行業分析師預測顯示,分析師們預計該公司的盈利增長率將會有巨大的改善。這些分析師的預期是基於行業的整體預期,還是基於公司的基本面?單擊此處查看我們對該公司的分析師預測頁面。

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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.

對本文有反饋?對內容有疑慮?請直接與我們聯繫。或者,發送電子郵件至 editorial-team (at) simplywallst.com。
這篇來自Simply Wall St的文章是一般性的。我們根據歷史數據和分析師預測提供評論,採用無偏見的方法,我們的文章並不旨在提供財務建議。它不構成對任何股票的買入或賣出建議,也未考慮到您的目標或財務狀況。我們旨在爲您提供以基本數據驅動的長期分析。請注意,我們的分析可能未考慮最新的價格敏感公司公告或定性材料。Simply Wall St在提到的任何股票中均沒有持倉。

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