Swire Properties Ltd

Swire Properties maintains a conservative capital structure with a debt-to-equity ratio of 0.20 and a current ratio of 1.15, indicating adequate short-term liquidity despite a medium liquidity risk rating. The balance sheet shows total assets of HKD 353.5 billion against total liabilities of HKD 84.1 billion, with long-term debt standing at HKD 54.1 billion. However, the company reports negative net cash after subtracting total debt, and free cash flow is negative at HKD -7.7 billion, driven by operating cash flow of HKD 7.5 billion and capital expenditures of HKD -225 million. The market capitalization is HKD 121.9 billion, trading at a price-to-book ratio of 0.45, suggesting the market values the equity below its book value.

Profitability metrics are currently negative, with a return on equity of -0.57% and return on assets of -0.43%, reflecting a net income loss of HKD 1.5 billion on revenue of HKD 16.0 billion. The gross profit is HKD 10.7 billion, yielding a gross margin of approximately 66%, but operating income is only HKD 2.0 billion, indicating significant operating expenses or other charges impacting the bottom line. The EV/EBITDA ratio is exceptionally high at 89.71, and EV/Revenue is 10.95, which may reflect the low earnings base rather than high growth expectations. Without cohort median data for direct comparison, these returns appear weak relative to typical real estate investment trusts or development firms, which usually target positive ROE and ROA.

The company's revenue mix is not detailed in the provided segments or geography sections, so specific concentration risks by segment or region cannot be quantified from the available data. the sector classification industry code confirms the primary activity is Real Estate Management & Development, implying revenue is derived from property-related activities. The absence of segment data prevents a detailed analysis of revenue concentration, but the overall revenue figure of HKD 16.0 billion provides a baseline for scale.

Growth trajectory cannot be assessed due to the absence of historical periods data for revenue and net income trends. The current financial snapshot shows a net loss, but without prior year comparisons, the direction of earnings momentum is unclear. The negative free cash flow suggests ongoing investment or working capital pressures, but the magnitude of change over time is not available in the input data.

Risk factors include medium liquidity risk and low dilution risk, with a key flag noting that net cash is negative after subtracting total debt. The negative free cash flow of HKD -7.7 billion is a significant concern, as it indicates that operating cash flow is not sufficient to cover capital expenditures and other cash outflows, potentially requiring debt financing or asset sales to maintain liquidity. The low dilution risk suggests that share count is stable, with basic and diluted shares outstanding both at 5.76 billion.

Recent events include analyst estimates with a mean price target of HKD 29.24 and a median of HKD 29.60, implying upside potential from the current market price of HKD 21.18. The mean recommendation is 1.82, with 2 strong buys and 9 buys, and no holds, indicating strong analyst confidence in the company's future performance. The high price target of HKD 30.70 and low of HKD 26.00 suggest a consensus view of undervaluation, although the current negative earnings and high valuation multiples present a contradiction that may be resolved by expected future earnings recovery or asset revaluation.

Analysts project 19.7% upside to a mean price target of HKD 27.75, reflecting strong market confidence.

Debt-to-equity ratio of 0.2 is well below the 0.33 cohort median, indicating a conservative capital structure.

Revenue grew 11.2% year-over-year to HKD 16.0 billion, showing top-line expansion despite profit headwinds.

Gross profit reached HKD 10.7 billion in FY2026, maintaining robust underlying profitability before operating expenses.

Free cash flow deteriorated to a HKD 7.7 billion outflow, worsening from a HKD 6.7 billion deficit.

Long-term debt surged to HKD 54.1 billion, a significant increase from HKD 25.6 billion in FY2022.

The company faces high credit risk and medium liquidity risk, posing significant financial stability concerns.

Revenue HK$16.04B, +11,2% YoY; Operating income +15,0% YoY.

• ▍Revenue HK$16.04B, +11,2% YoY
• ▍Operating income +15,0% YoY
• ▍Net income −100,1% YoY
• ▍Free cash flow −15,2% YoY
• ▍Net margin -9.6%

Revenue HK$14.43B, −1,6% YoY; Operating income −67,1% YoY.

• ▍Revenue HK$14.43B, −1,6% YoY
• ▍Operating income −67,1% YoY
• ▍Net income −129,1% YoY
• ▍Free cash flow −120,6% YoY
• ▍Net margin -5.3%

Revenue HK$14.67B, +6,1% YoY; Operating income −42,6% YoY.

• ▍Revenue HK$14.67B, +6,1% YoY
• ▍Operating income −42,6% YoY
• ▍Net income −67,0% YoY
• ▍Free cash flow −209,1% YoY
• ▍Net margin 18.0%

Revenue HK$13.83B, −15,3% YoY; Operating income +15,2% YoY.

• ▍Revenue HK$13.83B, −15,3% YoY
• ▍Operating income +15,2% YoY
• ▍Net income +12,2% YoY
• ▍Free cash flow +35,1% YoY
• ▍Net margin 57.7%

Revenue HK$16.32B; Operating income HK$7.83B.

• ▍Revenue HK$16.32B
• ▍Operating income HK$7.83B
• ▍Net margin 43.6%