Hong Kong Exchanges & Clearing (0388) AI Stock Analysis

• Market Cap: $551.98B
• Dividend Yield: 2.49%
• Average Volume (3M): 5.51M
• Price to Earnings (P/E): 40.4
• Beta (1Y): 1.55
• Revenue Growth: 25.62%
• EPS Growth: 16.92%
• Country: HK
• Employees: 2,444
• Sector: Financial
• Sector Strength: 71
• Industry: Financial - Data & Stock Exchanges
• EPS (TTM): 3.51
• Shares Outstanding: 1,267,836,900
• 10 Day Avg. Volume: 5,045,618
• 30 Day Avg. Volume: 5,506,373
• PEG Ratio: 2.83
• Price to Book (P/B): 6.92
• Price to Sales (P/S): 21.49
• P/FCF Ratio: 33.37
• Enterprise Value/Market Cap: 1.11
• Enterprise Value/Revenue: 25.29
• Enterprise Value/Gross Profit: 28.81
• Enterprise Value/Ebitda: 28.11
• 1Y Price Target: $494.44
• Price Target Upside: 11.21% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

• Rating: 67 Neutral
• Price Target: HK$485.00 ▲(9.09% Upside)

Hong Kong Exchanges & Clearing's strong financial performance is the most significant factor driving the overall score. However, the high P/E ratio suggests potential overvaluation, and technical indicators point to a possible short-term correction despite positive momentum.

Hong Kong Exchanges & Clearing Business Overview & Revenue Model

Company Description

Hong Kong Exchanges and Clearing Limited, together with its subsidiaries, owns and operates stock exchanges and futures exchanges, and related clearing houses in Hong Kong, Mainland China, and the United Kingdom. It operates through five segments: Cash, Equity and Financial Derivatives, Commodities, Post Trade, and Technology. The Cash segment covers various equity products traded on the cash market platforms of the Stock Exchange of Hong Kong Limited, the Shanghai Stock Exchange, and the Shenzhen Stock Exchange; sale of market data relating to the products; and other related activities. The Equity and Financial Derivatives segment provides and maintains trading platforms for a range of equity and financial derivative products, such as stock and equity index futures and options, derivative warrants, and callable bull/bear contracts and warrants, as well as sells related market data. The Commodities segment operates an exchange for the trading of base, ferrous, and precious metals futures and options contracts in the United Kingdom; and operates Qianhai Mercantile Exchange Co., Ltd., a commodity trading platform in the Mainland. This segment also covers commodities contracts traded on Futures Exchange. The Post Trade segment operates clearing houses that are responsible for clearing, settlement, depository, custodian, and nominee services. The Technology segment offers various services that provide users with access to the platform and infrastructure. The company serves issuers and investors. Hong Kong Exchanges and Clearing Limited is based in Central, Hong Kong.

How the Company Makes Money

HKEX generates revenue through several key channels. The primary source is transaction fees from trading activities across its platforms, including equities, commodities, and derivatives markets. It charges fees for each trade executed, which vary depending on the type and size of the transaction. Additionally, HKEX earns income from listing fees charged to companies that wish to list their shares on its exchanges. The company also makes money through clearing and settlement services, collecting fees for processing and settling trades. Another significant revenue stream is derived from market data sales; HKEX provides real-time market data and analytics to financial institutions, traders, and investors. Furthermore, HKEX benefits from its strategic partnerships and collaborations with other global exchanges and financial institutions, which enhance its market reach and product offerings.

Hong Kong Exchanges & Clearing Financial Statement Overview

Summary

Hong Kong Exchanges & Clearing demonstrates strong financial health across all statements with robust revenue and profit growth, a solid balance sheet, and substantial cash flow generation. While liabilities have increased, the overall risk is mitigated by high profitability and effective cash management.

Income Statement

The income statement reflects strong growth and profitability. Gross profit margin is high, indicating efficient cost management. The net profit margin is robust, supported by a consistent increase in net income. Revenue growth has shown a positive trajectory, and both EBIT and EBITDA margins are healthy, signaling operational efficiency and strong earnings capability.

Balance Sheet

The balance sheet is solid with a low debt-to-equity ratio, indicating conservative leverage. The return on equity is strong, reflecting efficient use of shareholder capital. The equity ratio is stable, suggesting a balanced capital structure. However, the total liabilities have increased, which could pose a future risk if not managed properly.

Cash Flow

Cash flow analysis shows a strong operating cash flow to net income ratio, highlighting effective cash generation from operations. Free cash flow growth has been positive, supporting the company's ability to fund expansions and dividends. However, cash flow from financing activities is consistently negative, indicating high dividend payouts or debt repayments, which should be monitored.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.15B	17.35B	20.39B	16.93B	19.47B	16.84B
Gross Profit	21.20B	12.94B	19.52B	13.30B	19.98B	13.12B
EBITDA	21.73B	22.15B	14.95B	13.34B	16.39B	14.77B
Net Income	15.44B	13.05B	11.86B	10.08B	12.54B	11.51B
Balance Sheet
Total Assets	424.87B	381.63B	341.18B	406.05B	399.30B	399.11B
Cash, Cash Equivalents and Short-Term Investments	282.46B	230.91B	224.70B	276.39B	342.33B	328.61B
Total Debt	873.00M	1.75B	1.60B	2.24B	2.06B	2.78B
Total Liabilities	367.42B	327.22B	289.38B	355.95B	349.39B	349.87B
Stockholders Equity	56.91B	53.85B	51.34B	49.73B	49.63B	48.92B
Cash Flow
Free Cash Flow	0.00	11.17B	10.11B	13.67B	11.27B	13.42B
Operating Cash Flow	0.00	12.77B	11.50B	14.96B	12.34B	14.77B
Investing Cash Flow	0.00	3.19B	-6.29B	-1.70B	2.28B	-7.48B
Financing Cash Flow	0.00	-11.26B	-11.25B	-10.37B	-12.67B	-7.47B

Hong Kong Exchanges & Clearing Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 444.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0388, the sentiment is Positive. The current price of 444.6 is above the 20-day moving average (MA) of 439.78, above the 50-day MA of 429.06, and above the 200-day MA of 357.67, indicating a bullish trend. The MACD of 3.34 indicates Positive momentum. The RSI at 57.38 is Neutral, neither overbought nor oversold. The STOCH value of 34.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0388.

Hong Kong Exchanges & Clearing Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6866	68 Neutral	HK$365.80M	6.86	2.48%	4.34%	-25.70%	-39.65%
Sector *	68 Neutral	$17.81B	11.59	9.88%	3.74%	9.69%	1.11%
0388	67 Neutral	$551.98B	40.41	28.32%	2.49%	25.62%	16.92%
2139	61 Neutral	HK$4.14B	6.68	1.72%	―	-9.56%	-7.51%
0216	54 Neutral	HK$347.36M	―	-7.70%	―	-6.84%	-746.07%
0674	41 Neutral	HK$229.71M	―	-16.08%	―	-33.03%	22.62%
4C30	―	€102.51M	8.74	6.23%	―	―	―

Hong Kong Exchanges & Clearing Corporate Events

HKEX Reports Strong Financial Growth in H1 2025

Hong Kong Exchanges and Clearing Limited (HKEX) reported a significant increase in its financial performance for the first half of 2025, with revenue and other income rising to HKD 14,076 million from HKD 10,621 million in the same period of 2024. The company’s profit for the period also saw a substantial increase, reaching HKD 8,562 million compared to HKD 6,186 million the previous year. This growth reflects HKEX’s strong market positioning and effective cost management, which resulted in a higher operating profit and improved earnings per share. The financial results underscore HKEX’s robust operational capabilities and its strategic importance in the financial market infrastructure sector.

The most recent analyst rating on (HK:0388) stock is a Buy with a HK$500.00 price target. To see the full list of analyst forecasts on Hong Kong Exchanges & Clearing stock, see the HK:0388 Stock Forecast page.

HKEX Reports Record Half-Yearly Revenue and Strategic Advancements in 2025

HKEX reported its best-ever half-yearly revenue and profit in the first half of 2025, regaining its position as the world’s top IPO venue by funds raised. The company has made significant strategic progress, including diversifying its product offerings and enhancing its listing framework. Key initiatives include preparations for a shorter cash market settlement cycle and the expansion of a paperless listing regime. These efforts aim to boost market competitiveness and attractiveness, providing investors and issuers with the necessary tools to navigate the global macroeconomic environment.

The most recent analyst rating on (HK:0388) stock is a Buy with a HK$500.00 price target. To see the full list of analyst forecasts on Hong Kong Exchanges & Clearing stock, see the HK:0388 Stock Forecast page.

HKEX Declares Interim Dividend of HKD 6 Per Share

Hong Kong Exchanges and Clearing Limited announced an interim cash dividend of HKD 6 per share for the financial year ending December 31, 2025. The ex-dividend date is set for September 2, 2025, with the payment date scheduled for September 16, 2025. This announcement reflects HKEX’s ongoing commitment to returning value to its shareholders and may bolster investor confidence in the company’s financial health.

The most recent analyst rating on (HK:0388) stock is a Buy with a HK$500.00 price target. To see the full list of analyst forecasts on Hong Kong Exchanges & Clearing stock, see the HK:0388 Stock Forecast page.