Lung Kee (Bermuda) Holdings Limited (0255) AI Stock Analysis

• Market Cap: HK$900.12M
• Dividend Yield: 14.77%
• Average Volume (3M): 41.87K
• Price to Earnings (P/E): 134.0
• Beta (1Y): 0.39
• Revenue Growth: -4.52%
• EPS Growth: N/A
• Country: HK
• Employees: 3,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Metal Fabrication
• EPS (TTM): >-0.01
• Shares Outstanding: 633,887,300
• 10 Day Avg. Volume: 75,200
• 30 Day Avg. Volume: 41,866
• PEG Ratio: 0.62
• Price to Book (P/B): 0.40
• Price to Sales (P/S): 0.44
• P/FCF Ratio: 3.54
• 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: 53 Neutral
• Price Target: HK$1.50 ▼(-9.09% Downside)

The score is held back primarily by weak profitability and declining revenue, plus bearish technicals with negative momentum. Support comes from a solid balance sheet, improving free cash flow, and a very high dividend yield, though the extremely high P/E limits the valuation score.

Positive Factors

Strong Balance Sheet

A high equity ratio and low leverage provide durable financial flexibility: the company can fund operations, absorb shocks, and invest in tooling or capacity without immediate refinancing risks. This underpins long-term stability and supports strategic responses to cyclical downturns.

Improving Free Cash Flow

Recovering free cash flow signals better cash generation and capital allocation. Sustained FCF allows funding of capex, maintenance of operations, and potential dividend support even with weak accounting profits, strengthening long-term operational resilience and financial optionality.

Repeat Business & Contracts

Long-term contracts and repeat customers create predictable order flow and support steady revenue streams. This structural customer stickiness reduces customer acquisition risk, enables capacity planning, and can preserve margins over time despite cyclical demand swings.

Negative Factors

Declining Revenue Trend

Sustained revenue decline reduces scale benefits and weakens bargaining power with suppliers. Over months this erodes operating leverage, pressures per-unit margins, and constrains reinvestment capacity, making recovery more difficult without structural market share gains or new product wins.

Negative Profitability & ROE

Persistent negative EBIT and net losses degrade retained earnings and have pushed ROE negative, limiting internal funding for growth and exposing the company to dividend cuts or capital measures. Over the medium term this weakens creditworthiness and strategic flexibility.

Cyclical End-Market Exposure

Concentration in automotive and electronics ties revenue to macro and technology cycles. Structural downturns or demand shifts in these sectors can materially reduce order volumes and idle capacity, creating sustained pressure on utilization, pricing, and long-term margin sustainability.

Lung Kee (Bermuda) Holdings Limited Business Overview & Revenue Model

Company Description

Lung Kee (Bermuda) Holdings Limited, an investment holding company, manufactures and markets mold bases and related products in the People's Republic of China and internationally. The company was founded in 1975 and is headquartered in Sha Tin, Hong Kong. Lung Kee (Bermuda) Holdings Limited is a subsidiary of Pan Island Investments Limited.

How the Company Makes Money

Lung Kee (Bermuda) Holdings Limited generates revenue primarily through the sale of its precision engineering products, which include die-casting components and metal fabrications for different industrial applications. The company benefits from a robust revenue model that includes direct sales to manufacturers and distributors across multiple sectors, enabling it to capture a significant market share. Key revenue streams comprise bulk orders from automotive and electronics manufacturers, which are often facilitated through long-term contracts and repeat business. Moreover, strategic partnerships with industry players enhance its market presence and contribute to steady revenue growth. The company's focus on quality and innovation further positions it favorably in competitive markets, allowing it to maintain healthy profit margins.

Lung Kee (Bermuda) Holdings Limited Financial Statement Overview

Summary

The company faces challenges with declining revenues and profitability, as evidenced by negative net income and EBIT. However, it maintains a robust balance sheet with strong equity and manageable debt levels. The cash flow position has improved, suggesting better cash management and potential for recovery.

Income Statement

The company experienced a decline in revenue over the past years, with a noticeable drop from 2020 to 2023. The gross profit margin improved significantly in 2024 due to a substantial increase in gross profit, despite a decrease in revenue. However, the negative EBIT and net income in recent years indicate operational challenges affecting profitability. The net profit margin is negative, highlighting profitability issues.

Balance Sheet

The company maintains a strong equity base, with a high equity ratio and low debt-to-equity ratio, indicating financial stability. Despite a decrease in total assets, the decrease in liabilities suggests improved leverage management. The return on equity has turned negative due to recent net losses, which warrants attention.

Cash Flow

The cash flow statements show a positive trend in free cash flow, recovering from negative figures in previous years. The operating cash flow to net income ratio is strong, indicating efficient cash generation relative to earnings. The company shows improvement in managing capital expenditures, contributing to a positive free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.46B	1.55B	1.45B	1.60B	2.27B	2.06B
Gross Profit	884.46M	951.69M	263.90M	398.00M	777.07M	653.19M
EBITDA	154.25M	148.58M	56.87M	180.74M	472.05M	367.38M
Net Income	6.69M	-13.67M	-72.43M	15.81M	227.84M	181.08M
Balance Sheet
Total Assets	1.89B	1.97B	2.09B	2.30B	2.75B	2.75B
Cash, Cash Equivalents and Short-Term Investments	518.08M	546.65M	428.76M	536.64M	833.59M	918.62M
Total Debt	6.18M	7.83M	6.57M	9.56M	9.02M	14.29M
Total Liabilities	284.60M	298.08M	294.22M	314.90M	474.46M	471.25M
Stockholders Equity	1.60B	1.67B	1.80B	1.99B	2.27B	2.27B
Cash Flow
Free Cash Flow	179.43M	190.82M	-35.72M	-93.17M	168.61M	255.22M
Operating Cash Flow	222.65M	226.34M	77.21M	89.17M	369.94M	368.26M
Investing Cash Flow	-39.56M	-24.35M	-98.07M	-170.05M	-193.03M	-107.73M
Financing Cash Flow	-149.50M	-67.33M	-73.86M	-168.90M	-277.76M	-139.41M

Lung Kee (Bermuda) Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.65
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0255, the sentiment is Negative. The current price of 1.65 is above the 20-day moving average (MA) of 1.60, below the 50-day MA of 1.76, and above the 200-day MA of 1.51, indicating a bearish trend. The MACD of -0.12 indicates Positive momentum. The RSI at 25.88 is Positive, neither overbought nor oversold. The STOCH value of 24.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:0255.

Lung Kee (Bermuda) Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1050	68 Neutral	HK$5.05B	24.70	19.09%	1.81%	10.34%	3.48%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
0838	63 Neutral	HK$1.54B	6.16	8.13%	5.09%	0.51%	3.74%
3816	60 Neutral	HK$276.00M	6.22	7.82%	2.71%	28.78%	185.71%
0929	54 Neutral	HK$820.76M	78.79	0.57%	―	1.48%	12.50%
0255	53 Neutral	HK$900.12M	133.96	0.40%	14.77%	-4.52%	―
0822	50 Neutral	HK$335.16M	-6.63	-4.46%	―	10.91%	11.01%

Lung Kee (Bermuda) Holdings Limited Corporate Events

Lung Kee Warns of Wider 2025 Loss on Weaker Sales and Property Revaluation Hit

Lung Kee Group Holdings Limited has issued a profit warning, stating that it expects to post a net loss of at least HK$21 million for the year ended 31 December 2025, widening from the HK$14 million loss recorded a year earlier. The deeper loss is mainly attributed to weaker sales revenue amid a tough market environment and a larger decrease in the fair value of its investment properties, driven by downward adjustments in market rents for Hong Kong retail assets, and the company cautioned shareholders and potential investors to exercise care when dealing in its shares ahead of the release of audited results expected by end-March 2026.

The most recent analyst rating on (HK:0255) stock is a Hold with a HK$1.50 price target. To see the full list of analyst forecasts on Lung Kee (Bermuda) Holdings Limited stock, see the HK:0255 Stock Forecast page.