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Swire Pacific Limited Class B (HK:0087)
:0087
Hong Kong Market

Swire Pacific Limited Class B (0087) AI Stock Analysis

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HK

Swire Pacific Limited Class B

(0087)

Rating:75Outperform
Price Target:
Swire Pacific's overall stock score reflects a stable financial position and attractive valuation, tempered by recent operational challenges. Key strengths include a robust balance sheet and solid dividend yield, which provide a cushion against economic uncertainties. However, declining profitability and inconsistent cash flow growth highlight areas needing improvement. The mixed technical indicators and earnings call suggest cautious optimism, with potential for recovery if strategic initiatives are successful.

Swire Pacific Limited Class B (0087) vs. iShares MSCI Hong Kong ETF (EWH)

Swire Pacific Limited Class B Business Overview & Revenue Model

Company DescriptionSwire Pacific Limited engages in property, aviation, beverages, marine, and trading and industrial businesses in Hong Kong, Mainland China, rest of Asia, the United States, and internationally. The company's Property division develops, owns, and operates mixed-use properties. This division's property investment portfolio comprises office and retail premises, serviced apartments, other luxury residential accommodations, and commercial mixed-use developments; and trading portfolio consists of residential properties. It also owns and manages two hotels in Hong Kong and four hotels in Mainland China, as well as owns interests in the Mandarin Oriental hotel in the United States. The company's Aviation division provides flight catering and ramp, passenger and cargo services, and aircraft maintenance and modification services. As of December 31, 2021, it had a fleet of 234 aircraft. Its Beverages division owns rights to manufacture, market, and distribute refreshing soft drinks to consumers. The company's Trading & Industrial division retails and distributes footwear, apparel, and accessories through its 164 retail outlets; sells passenger cars, commercial vehicles, motorcycles, and scooters; operates a chain of 538 bakery stores; packages and sells sugar products under the Taikoo Sugar brand; and offers waste management services. The company was founded in 1816 and is based in Central, Hong Kong.
How the Company Makes MoneySwire Pacific Limited Class B makes money through a diversified revenue model that spans multiple sectors. In the property sector, the company earns revenue from leasing and management of commercial and retail properties, as well as from property development and sales. In aviation, Swire Pacific generates income through its significant investment in Cathay Pacific Airways, benefiting from passenger and cargo services. The beverages segment contributes to its earnings through the production, distribution, and sale of beverages, primarily in partnership with The Coca-Cola Company. The marine services division provides offshore support services, while the trading and industrial sector involves various businesses, including automotive trading and manufacturing. Strategic partnerships, such as those with The Coca-Cola Company and its stake in Cathay Pacific, play a crucial role in its earnings, providing stable revenue streams across different economic cycles.

Swire Pacific Limited Class B Earnings Call Summary

Earnings Call Date:Mar 13, 2025
(Q4-2024)
|
% Change Since: -0.82%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive developments and challenges. Strategic investments in key regions, strong performance in the aviation sector, and growth in the Chinese Mainland beverages market were notable highlights. However, challenges such as a decline in recurring profits, lower office rental income in Hong Kong, and supply chain issues in the aviation sector were significant concerns.
Q4-2024 Updates
Positive Updates
Investment in Strategic Regions
Swire Pacific committed 67% of their HK$100 billion investment plan, focusing on the Greater Bay Area, INDIGO projects in Beijing, and new residential projects in Shanghai.
Cathay Pacific's Strong Performance
Cathay Pacific achieved a 45% growth in recurring profit, attributed to robust demand for passenger travel and strong cargo performance, also committing HK$100 billion in re-fleeting over the next seven years.
Increase in Dividend
Swire Pacific increased its dividend by 5% despite a challenging operating environment.
Chinese Mainland Beverages Growth
Recurring profit from the Chinese Mainland went up by 11%, driven by price increases and strong market execution.
Healthcare Expansion
Swire Pacific completed acquisitions in the healthcare sector, including a hospital in Shanghai and an investment in 70 hospitals in Indonesia, with a planned HK$20 billion investment over 10 years.
Negative Updates
Decline in Recurring Underlying Profit
Recurring underlying profit declined by 11% from the prior year, primarily due to the sale of the US bottler in 2023.
Lower Office Rental Income in Hong Kong
There was a continued decline in office rental income in Hong Kong, contributing to lower profits in the property division.
Challenges in Southeast Asia Beverages
The EBITDA in Vietnam and Cambodia decreased by 7%, affected by exchange rate fluctuations and higher relocation costs.
Aviation Industry Supply Chain Challenges
Supply chain challenges continue to affect the aviation industry, including Cathay Pacific, impacting equipment orders and operations.
Company Guidance
During the Swire Pacific 2024 Annual Results Analyst Briefing, several key metrics were highlighted by the leadership team. Despite a challenging operating environment, Swire Properties committed 67% of their HK$100 billion investment plan, with significant investments in the Greater Bay Area and new residential projects in Shanghai. The company's recurring underlying profit was reported at HK$9.3 billion, down 11% year-over-year, primarily due to the disposal of the US bottler in 2023. However, excluding this, there was a slight gain in recurring profit. As a result, dividends were increased by 5%. The beverage segment saw a decrease in overall profit due to the US bottler sale, but Chinese Mainland's recurring profit rose by 11%, driven by price increases. The aviation sector, particularly Cathay Pacific, showed strong performance with a 45% growth in recurring profit, supported by passenger travel demand and cargo performance. Swire Pacific maintained a healthy gearing ratio of 22.1%, with net debt at HK$70 billion and significant liquidity of over HK$43 billion. The company also focused on sustainability, with Swire Properties achieving top rankings in the Dow Jones Index for Real Estate.

Swire Pacific Limited Class B Financial Statement Overview

Summary
Income Statement
Balance Sheet
Cash Flow
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
82.84B81.97B94.82B91.17B90.80B80.03B
Gross Profit
30.98B30.46B35.15B34.19B35.28B30.21B
EBIT
9.98B4.24B30.62B11.83B12.10B-3.10B
EBITDA
34.78B14.62B35.57B16.07B16.41B8.55B
Net Income Common Stockholders
28.55B4.32B28.85B6.27B5.12B-10.10B
Balance SheetCash, Cash Equivalents and Short-Term Investments
4.18B21.03B14.08B11.61B22.89B29.26B
Total Assets
270.57B476.56B447.75B434.77B436.32B433.11B
Total Debt
43.12B99.47B74.90B73.29B66.89B73.32B
Net Debt
39.31B79.65B63.06B61.67B43.99B44.05B
Total Liabilities
61.52B157.89B122.98B118.83B112.15B113.96B
Stockholders Equity
204.45B258.30B268.13B258.46B266.95B262.69B
Cash FlowFree Cash Flow
5.61B6.05B6.32B4.73B7.45B8.46B
Operating Cash Flow
9.49B10.46B9.92B8.16B11.66B11.46B
Investing Cash Flow
15.00B-14.60B13.03B-17.54B-6.34B1.73B
Financing Cash Flow
-20.16B12.62B-21.73B-1.40B-12.34B-5.69B

Swire Pacific Limited Class B Technical Analysis

Technical Analysis Sentiment
Positive
Last Price10.82
Price Trends
50DMA
10.45
Positive
100DMA
10.42
Positive
200DMA
10.17
Positive
Market Momentum
MACD
0.07
Negative
RSI
59.15
Neutral
STOCH
85.42
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0087, the sentiment is Positive. The current price of 10.82 is above the 20-day moving average (MA) of 10.67, above the 50-day MA of 10.45, and above the 200-day MA of 10.17, indicating a bullish trend. The MACD of 0.07 indicates Negative momentum. The RSI at 59.15 is Neutral, neither overbought nor oversold. The STOCH value of 85.42 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0087.

Swire Pacific Limited Class B Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
$213.26B12.1511.23%6.11%-2.77%4.04%
75
Outperform
HK$83.41B3.541.64%6.19%-13.56%-84.68%
70
Outperform
$74.12B19.492.17%7.43%-30.38%-43.73%
68
Neutral
$83.41B22.031.64%5.09%-13.56%-84.68%
66
Neutral
$4.51B12.295.40%248.53%4.14%-12.41%
65
Neutral
$68.91B-2.30%1.99%-36.07%-441.20%
47
Neutral
$11.70B-10.34%10.75%-56.64%-3398.20%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:0087
Swire Pacific Limited Class B
10.82
1.46
15.60%
HK:0083
Sino Land Co
8.10
0.53
6.99%
HK:0017
New World Development
4.65
-3.41
-42.31%
HK:0004
Wharf (Holdings)
22.55
0.75
3.43%
HK:0011
Hang Seng Bank
113.30
13.48
13.50%
HK:0019
Swire Pacific
67.40
4.98
7.97%

Swire Pacific Limited Class B Corporate Events

Swire Pacific Limited Declares Second Interim Dividend for 2024
Mar 13, 2025

Swire Pacific Limited has announced a second interim ordinary dividend of HKD 0.42 per share for the financial year ending 31 December 2024. The ex-dividend date is set for 9 April 2025, with the payment date scheduled for 9 May 2025. This dividend announcement reflects the company’s ongoing commitment to providing shareholder returns and may influence investor sentiment positively.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.