Hengtong Optic-Electric Co Ltd

Hengtong Optic-Electric maintains a balanced capital structure with a debt-to-equity ratio of 0.49 and a current ratio of 1.54, indicating adequate short-term liquidity despite a medium liquidity risk assessment. The company holds total assets of 72.36 billion CNY against total liabilities of 40.58 billion CNY, resulting in total equity of 31.78 billion CNY. Long-term debt stands at 15.65 billion CNY, while operating cash flow of 2.81 billion CNY supports a free cash flow of 646.18 million CNY after capital expenditures of 2.84 billion CNY. The firm carries a negative net cash position after subtracting total debt, which is flagged as a key risk factor.

Profitability metrics show a return on equity of 8.59% and a return on assets of 3.77%, reflecting moderate efficiency in asset utilization. The company generated net income of 2.68 billion CNY on revenue of 66.85 billion CNY, yielding a gross profit of 8.33 billion CNY and operating income of 3.05 billion CNY. While specific cohort median comparisons are not provided in the input data, the valuation multiples suggest a premium pricing environment, with a price-to-earnings ratio of 70.3 and an EV/EBITDA of 66.07. The price-to-book ratio stands at 6.04, indicating that investors are assigning a significant premium to the company's book value.

Revenue concentration and geographic exposure details are not explicitly provided in the available data segments. The company's primary activity is identified as Electric Utilities within the rule-based classification, but its sector classification industry code points to Communications Equipment, suggesting a business model focused on telecommunications infrastructure rather than traditional utility services. Without specific segment or geographic breakdowns, the revenue mix remains undefined in this analysis.

Growth trajectory analysis is limited by the absence of historical period data in the input. The latest normalized period shows revenue of 66.85 billion CNY, but without prior year or quarterly comparisons, the year-over-year growth rate cannot be calculated. The company's ability to sustain revenue growth depends on its position in the communications equipment market and its capacity to manage capital expenditures, which currently stand at 2.84 billion CNY.

Risk factors include a medium liquidity risk and low dilution risk, with the key flag being the negative net cash position after debt subtraction. The company's shares outstanding are 2.47 billion for both basic and diluted measures, indicating no significant dilution from options or convertible securities. The absence of historical data limits the assessment of long-term risk trends, but the current balance sheet suggests manageable leverage with a debt-to-equity ratio below 0.5.

Recent events and analyst sentiment indicate a positive outlook, with a mean recommendation of 1.43 (strong buy) and a mean price target of 62.73 CNY, although the median price target is higher at 77.33 CNY. The high price target reaches 84.30 CNY, while the low is 26.57 CNY, reflecting a wide range of analyst expectations. There are four strong-buy ratings and three buy ratings, with no hold ratings, suggesting strong institutional confidence in the company's near-term prospects.

Revenue grew at a 12.8% CAGR over four years, demonstrating strong top-line expansion momentum.

Net income CAGR of 16.9% over four years indicates robust profitability growth trajectory.

Debt-to-equity ratio of 0.49 is well below the 0.75 cohort median, suggesting lower leverage risk.

Free cash flow turned positive in FY-2, reaching 1.0 billion CNY, improving liquidity generation.

Operating income fell 7.5% year-over-year, indicating weakening core operational profitability trends.

Net margin of 4.14% is significantly below the 7.61% median for the Electric Utilities cohort.

The company faces a high credit risk flag, suggesting potential solvency or repayment concerns.

Revenue ¥17.79B, +34,1% YoY; Operating income +98,2% YoY.

• ▍Revenue ¥17.79B, +34,1% YoY
• ▍Operating income +98,2% YoY
• ▍Net income +98,5% YoY
• ▍Net margin 6.2%

Revenue ¥17.23B, −2,0% YoY; Operating income −46,9% YoY.

• ▍Revenue ¥17.23B, −2,0% YoY
• ▍Operating income −46,9% YoY
• ▍Net income −32,9% YoY
• ▍Net margin 1.8%

Revenue ¥17.57B, +11,3% YoY; Operating income +3,6% YoY.

• ▍Revenue ¥17.57B, +11,3% YoY
• ▍Operating income +3,6% YoY
• ▍Net income +8,1% YoY
• ▍Net margin 4.3%

Revenue ¥18.78B, +26,6% YoY; Operating income −4,6% YoY.

• ▍Revenue ¥18.78B, +26,6% YoY
• ▍Operating income −4,6% YoY
• ▍Net income −3,6% YoY
• ▍Net margin 5.6%

Revenue ¥13.27B; Operating income ¥653.1M.

• ▍Revenue ¥13.27B
• ▍Operating income ¥653.1M
• ▍Net margin 4.2%

Revenue ¥17.58B; Operating income ¥591.9M.

• ▍Revenue ¥17.58B
• ▍Operating income ¥591.9M
• ▍Net margin 2.6%

Revenue ¥15.79B; Operating income ¥848.6M.

• ▍Revenue ¥15.79B
• ▍Operating income ¥848.6M
• ▍Net margin 4.5%

Revenue ¥14.83B; Operating income ¥1.26B.

• ▍Revenue ¥14.83B
• ▍Operating income ¥1.26B
• ▍Net margin 7.4%

Revenue ¥66.85B, +11,4% YoY; Operating income −7,5% YoY.

• ▍Revenue ¥66.85B, +11,4% YoY
• ▍Operating income −7,5% YoY
• ▍Net income −3,2% YoY
• ▍Free cash flow −64,3% YoY
• ▍Net margin 4.0%

Revenue ¥59.98B, +26,0% YoY; Operating income +36,1% YoY.

• ▍Revenue ¥59.98B, +26,0% YoY
• ▍Operating income +36,1% YoY
• ▍Net income +28,6% YoY
• ▍Free cash flow +80,7% YoY
• ▍Net margin 4.6%

Revenue ¥47.62B, +2,5% YoY; Operating income +44,4% YoY.

• ▍Revenue ¥47.62B, +2,5% YoY
• ▍Operating income +44,4% YoY
• ▍Net income +36,0% YoY
• ▍Free cash flow +945,8% YoY
• ▍Net margin 4.5%

Revenue ¥46.46B, +12,6% YoY; Operating income −1,7% YoY.

• ▍Revenue ¥46.46B, +12,6% YoY
• ▍Operating income −1,7% YoY
• ▍Net income +10,2% YoY
• ▍Free cash flow +77,9% YoY
• ▍Net margin 3.4%