Wharf (Holdings) (0004) AI Stock Analysis

• Market Cap: HK$70.47B
• Dividend Yield: 1.76%
• Average Volume (3M): 874.29K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.61
• Revenue Growth: -39.77%
• EPS Growth: 97.82%
• Country: HK
• Employees: 6,400
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Development
• EPS (TTM): 0.67
• Shares Outstanding: 3,056,027,300
• 10 Day Avg. Volume: 747,424
• 30 Day Avg. Volume: 874,290
• PEG Ratio: 0.05
• Price to Book (P/B): 0.49
• Price to Sales (P/S): 5.51
• P/FCF Ratio: 18.55
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 61 Neutral
• Price Target: HK$26.00 ▲(14.04% Upside)

The overall stock score of 61 reflects a mixed outlook. The company's strong operational efficiency and solid equity base are positive, but significant profitability challenges and declining revenue weigh heavily. Technical indicators show bullish momentum, but valuation metrics highlight concerns with a negative P/E ratio and low dividend yield.

Positive Factors

Operational Efficiency

High EBIT margin reflects strong operational efficiency, suggesting effective cost management and a competitive advantage in core operations.

Cash Flow Generation

Improved cash generation enhances financial flexibility, allowing for reinvestment in growth opportunities and debt management.

Balance Sheet Health

A low debt-to-equity ratio indicates strong balance sheet health, providing stability and reducing financial risk in volatile markets.

Negative Factors

Revenue Decline

Declining revenue suggests challenges in market demand or competitive positioning, potentially impacting long-term growth prospects.

Profitability Challenges

Negative net income and profit margin indicate profitability issues, which could hinder reinvestment and shareholder returns over time.

Asset and Equity Decline

Decreasing assets and equity could limit growth capacity and financial resilience, affecting the company's ability to capitalize on opportunities.

Wharf (Holdings) Business Overview & Revenue Model

Company Description

Founded in 1886 with Hong Kong as its base, The Wharf (Holdings) Limited (Stock code: 0004) is the 17th company incorporated in Hong Kong and a premier company with a long history. As one of the 30 constituent stocks in the original Hang Seng Index since more than 50 years ago, Wharf is among the top local blue chips that is most actively traded and widely held. Backed by a long standing mission of Building for Tomorrow and a proven track record in management and execution, the Group has produced consistent and productive performance over the years. Subsequent to the separate listing of Wharf Real Estate Investment Company Limited in November 2017 which focuses on its Hong Kong investment properties portfolio, The Wharf (Holdings) Limited's businesses are largely property-related, comprising Investment Properties, Hotels and Development Properties in Hong Kong and Mainland China. Other businesses include Logistics through Modern Terminals and Hong Kong Air Cargo Terminals. Wharf's Peak Portfolio redefines the concept of luxury living with a collection of the rare and most prestigious residences, epitomising a unique and exclusive lifestyle at the most sought-after addresses in town. Besides the highly-acclaimed Mount Nicholson, other properties under development include 1 Plantation Road, 11 Plantation Road and 77 Peak Road. Besides The Peak Portfolio, the development pipeline of Hong Kong Properties also includes the Kowloon Tong Residential Project and projects in Kowloon East. In the Mainland, Wharf spearheads its investment properties with the International Finance Square (IFS) series at the very heart of CBD or new CBD in high potential cities including Changsha, Chengdu, Chongqing, Suzhou and Wuxi. IFS developments are positioned as trendsetting landmarks with unrivalled locations, superior planning and design, retailer and shopper critical mass, as well as top-notch retail management. Changsha IFS, 2018's newest to the collection, and Chengdu IFS opened in 2014 are comparable to Harbour City in Hong Kong in scale and prominence. The boutique Chongqing IFS, featuring the largest cluster of first-tier brands in Chongqing, was opened in 2017. The Group continues to adopt a selective land acquisition policy with strategic focus on key Tier 1 or 2 cities in order to secure high quality land bank with returns. The development property landbank at the end of June 2019 totalled 3.6 million square metres. Wharf Hotels manages an expanding portfolio of 17 hotels in Asia, spearheaded by a prominent Niccolo brand in recent years. The Wharf Hotels owns four contemporary, urban, chic Niccolo hotels (including The Murray, Hong Kong and Niccolo Changsha) and manages 13 Marco Polo hotels in Hong Kong, Mainland China and the Philippines. Niccolo Suzhou is the newest addition under development and is scheduled to open in 2021. The Group also owns and operates Modern Terminals and Hong Kong Air Cargo Terminals, key components in Hong Kong's success as a hub for international trade and international transportation for decades. CME2 is the Group's long-term investment, representing a strategic initiative of reinvesting capital and profit released from the CME1 exit in Hong Kong in a progressive new economy infrastructure CME2 arena that covers much larger markets with greater growth potential. Building for Tomorrow also extends to Wharf's Business-in-Community (BIC) pursuit. With the flagship school improvement programme Project Wecan growing from strength to strength, the Group supports a series of BIC initiatives including Wu Zhi Qiao (Bridge to China) Charitable Foundation, Shanghai International Tower-running Grand Prix and Operation Panda with an aim of promoting BIC and to bring benefits to different segments of society.

How the Company Makes Money

Wharf (Holdings) generates revenue primarily through its property investment activities, where it earns rental income from its extensive portfolio of properties. This includes commercial office spaces and retail properties in prime locations. Additionally, the company derives revenue from its logistics operations, which include port and container terminal services, contributing significantly to its earnings. The telecommunications segment provides another revenue stream through broadband and telecommunication services. Significant partnerships with local and international businesses in these sectors, along with strategic property developments and acquisitions, further enhance its revenue potential. Economic factors, such as demand for real estate and logistics services, also play a critical role in influencing the company's earnings.

Wharf (Holdings) Financial Statement Overview

Summary

Wharf (Holdings) shows mixed financial health. Strong operational efficiency and a solid equity base support stability, but the negative net income and declining revenue highlight challenges. The balance sheet is robust with low leverage, but cash flow improvements contrast with profitability issues.

Income Statement

The company has shown a significant revenue decline from 2023 to 2024, with total revenue dropping from $18.95B to $12.115B. The gross profit margin in 2024 remains strong at 100%, but net income has turned negative, resulting in a net profit margin of -26.61%. EBIT margin is robust at 46.61%, indicating solid operational efficiency despite the revenue decline. However, the EBITDA margin is negative due to high depreciation or amortization expenses.

Balance Sheet

The balance sheet reflects stability with a high stockholders' equity of $136.832B in 2024. The debt-to-equity ratio is relatively low at 0.12, suggesting prudent financial leverage. The equity ratio stands at 72.00%, indicating a strong equity base relative to total assets. However, the decline in total assets and stockholders' equity over the years may pose potential risks.

Cash Flow

Operating cash flow increased from $2.379B in 2023 to $3.83B in 2024, indicating improved cash generation capabilities. The free cash flow growth rate is substantial at 99.78%, and the operating cash flow to net income ratio is strong due to a negative net income. However, the free cash flow to net income ratio is negative, reflecting challenges in translating profits into cash flows.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.75B	12.12B	18.95B	18.06B	22.38B	21.00B
Gross Profit	10.75B	7.77B	9.05B	8.84B	11.31B	12.89B
EBITDA	4.29B	-5.29B	3.75B	1.30B	10.31B	10.99B
Net Income	-52.00M	-3.22B	945.00M	-1.71B	6.02B	3.86B
Balance Sheet
Total Assets	198.61B	190.04B	204.88B	221.75B	253.70B	254.09B
Cash, Cash Equivalents and Short-Term Investments	13.08B	9.72B	11.59B	14.65B	23.56B	16.67B
Total Debt	16.52B	16.85B	19.43B	19.96B	36.74B	42.17B
Total Liabilities	49.56B	47.57B	56.67B	66.04B	87.32B	90.62B
Stockholders Equity	143.30B	136.83B	142.99B	151.59B	162.02B	158.85B
Cash Flow
Free Cash Flow	5.29B	3.60B	1.80B	5.83B	2.08B	9.89B
Operating Cash Flow	5.29B	3.83B	2.38B	6.18B	2.55B	10.27B
Investing Cash Flow	-1.65B	-2.59B	-3.55B	4.31B	11.31B	-14.22B
Financing Cash Flow	-1.17B	-3.72B	-1.75B	-17.55B	-7.41B	-5.51B

Wharf (Holdings) Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 22.80
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0004, the sentiment is Positive. The current price of 22.8 is above the 20-day moving average (MA) of 22.60, below the 50-day MA of 22.87, and above the 200-day MA of 21.78, indicating a bullish trend. The MACD of -0.05 indicates Negative momentum. The RSI at 55.06 is Neutral, neither overbought nor oversold. The STOCH value of 88.83 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0004.

Wharf (Holdings) Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1113	70 Outperform	HK$149.23B	13.12	2.92%	4.33%	9.72%	-26.47%
0688	68 Neutral	HK$142.83B	9.44	3.63%	4.54%	-9.54%	-38.16%
1109	68 Neutral	HK$208.08B	7.11	10.17%	5.18%	14.40%	-2.55%
0083	67 Neutral	HK$105.94B	24.88	2.41%	5.62%	-0.48%	-13.78%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
0004	61 Neutral	HK$70.47B	-1,354.12	-0.04%	1.76%	-39.77%	97.82%
2202	40 Underperform	HK$60.51B	-0.62	-23.88%	―	-28.36%	-206.13%

Wharf (Holdings) Corporate Events

Wharf and WREIC Sign New Master Tenancy Agreement

Wharf Group and WREIC Group have entered into a New Master Tenancy Agreement with WAC to regulate continuing connected transactions related to the renting and licensing of premises among WAC Group Members. This agreement, effective from January 1, 2026, to December 31, 2028, ensures compliance with the Listing Rules and sets annual cap amounts for transactions, impacting how these companies manage their real estate assets and maintain regulatory standards.

The most recent analyst rating on (HK:0004) stock is a Hold with a HK$26.00 price target. To see the full list of analyst forecasts on Wharf (Holdings) stock, see the HK:0004 Stock Forecast page.

Wharf, WREIC, and HCDL Sign New Property Services Agreement

Wharf, WREIC, and HCDL have entered into a New Master Property Services Agreement effective from January 1, 2026, to December 31, 2028. This agreement is designed to regulate ongoing connected transactions related to property services among WAC Group Members, ensuring compliance with listing rules. The agreement’s implementation is expected to streamline operations and maintain regulatory standards without requiring independent shareholders’ approval.

The most recent analyst rating on (HK:0004) stock is a Hold with a HK$26.00 price target. To see the full list of analyst forecasts on Wharf (Holdings) stock, see the HK:0004 Stock Forecast page.

Wharf and WREIC Enter New Hotel Services Agreement

Wharf and WREIC have entered into a New Master Hotel Services Agreement to regulate continuing connected transactions for hotel-related services provided by Wharf to WREIC. This agreement, effective from January 1, 2026, to December 31, 2028, outlines the terms for services such as management, marketing, and financial services for WREIC’s hotel properties. The agreement is subject to certain regulatory requirements but is exempt from the need for independent shareholders’ approval, indicating a streamlined process for these transactions.

The most recent analyst rating on (HK:0004) stock is a Hold with a HK$26.00 price target. To see the full list of analyst forecasts on Wharf (Holdings) stock, see the HK:0004 Stock Forecast page.