Yuexiu Real Estate Investment (0405) AI Stock Analysis

• Market Cap: HK$4.68B
• Dividend Yield: 7.32%
• Average Volume (3M): 3.86M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.11
• Revenue Growth: -5.33%
• EPS Growth: -2880.00%
• Country: HK
• Employees: 726
• Sector: Real Estate
• Sector Strength: 57
• Industry: REIT - Diversified
• EPS (TTM): -0.06
• Shares Outstanding: 5,141,086,400
• 10 Day Avg. Volume: 4,064,895
• 30 Day Avg. Volume: 3,860,372
• PEG Ratio: 0.09
• Price to Book (P/B): 0.48
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 22.64
• 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: HK$1.02
• Price Target Upside: 12.14% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 64 Neutral
• Price Target: HK$1.00 ▲(9.89%Upside)

The stock score is primarily influenced by solid operational efficiency and bullish technical indicators. However, the lack of profitability and negative P/E ratio weigh down the valuation. The high dividend yield provides some appeal, but the company must address its net losses to improve its financial health.

Positive Factors

Asset Management

Revitalizing quality assets to fend against headwinds ahead, with successful leasing run rates for converted units despite a tough market environment.

Leadership

The newly appointed CEO Ms Ou already served a key operational personnel of the REIT since 2019, indicating a smooth transition in leadership.

Negative Factors

Market Challenges

The China office market, comprising a significant portion of Yuexiu REIT’s portfolio, continues to face challenges amid a weak macro backdrop and incoming supply.

Supply-Demand Imbalance

Office weakness to persist due to supply-demand imbalance in the REIT’s key markets; cut FY25-26F DPU by 39-40% on revised distribution ratio and rental assumptions.

Yuexiu Real Estate Investment Business Overview & Revenue Model

Company Description

Yuexiu Real Estate Investment Trust (Yuexiu REIT) is a Hong Kong-based real estate investment trust that primarily invests in a diverse portfolio of income-generating commercial properties in China. The company's core assets include office buildings, retail spaces, and hotels, with a strategic focus on properties located in key economic hubs such as Guangzhou. Yuexiu REIT aims to deliver stable and sustainable distributions to its unitholders by optimizing the value of its property portfolio through active asset management and strategic acquisitions.

How the Company Makes Money

Yuexiu REIT generates revenue primarily through leasing income from its portfolio of commercial properties, which include office spaces, retail centers, and hotels. The company benefits from long-term lease agreements with tenants, providing a stable and recurring income stream. Additionally, Yuexiu REIT may engage in property development or redevelopment projects to enhance the value of its assets, thereby increasing rental income potential. Strategic acquisitions of new properties can also contribute to growth in revenue. The company may also form partnerships or joint ventures to leverage market opportunities and enhance its asset base. Furthermore, Yuexiu REIT's revenue is influenced by factors such as property market conditions, occupancy rates, and rental price trends in the regions where it operates.

Yuexiu Real Estate Investment Financial Statement Overview

Summary

Yuexiu Real Estate Investment demonstrates operational efficiency with strong EBIT and EBITDA margins. However, recent net losses pose risks to profitability and equity returns. The balance sheet remains stable with a manageable leverage profile, while cash flows are positive, indicating strong cash management.

Income Statement

The income statement shows fluctuating revenue over recent years with a decline in total revenue from 2023 to 2024. Gross Profit Margin remains solid, indicating efficient cost management relative to revenue. However, the company faced a net loss in 2024, which negatively impacted the Net Profit Margin. EBIT and EBITDA margins are relatively strong, suggesting operational efficiency despite the net loss.

Balance Sheet

The balance sheet reflects a stable equity base with a moderate Debt-to-Equity Ratio, indicating manageable leverage. However, there's a slight decrease in Stockholders' Equity from 2023 to 2024. The Equity Ratio is stable, suggesting a balanced capital structure. Return on Equity is negative in 2024 due to the net loss, which is a point of concern.

Cash Flow

Cash flow analysis indicates positive operating cash flow in 2024, though decreased from 2023. Free cash flow remains positive despite negative net income, highlighting strong cash generation capabilities. The Operating Cash Flow to Net Income and Free Cash Flow to Net Income ratios suggest that the company is generating cash effectively relative to its net income.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.03B	2.09B	1.87B	1.80B	1.76B
Gross Profit	1.43B	1.67B	1.31B	1.30B	1.31B
EBITDA	1.18B	1.30B	424.21M	1.41B	1.38B
Net Income	-320.58M	4.63M	-529.04M	645.00M	565.50M
Balance Sheet
Total Assets	43.28B	43.85B	43.87B	43.86B	36.26B
Cash, Cash Equivalents and Short-Term Investments	1.40B	1.24B	1.37B	1.45B	1.80B
Total Debt	20.59B	20.28B	19.94B	17.63B	14.02B
Total Liabilities	42.10B	27.01B	26.54B	27.94B	20.49B
Stockholders Equity	14.83B	15.63B	16.10B	14.72B	14.58B
Cash Flow
Free Cash Flow	202.91M	428.81M	338.72M	756.79M	666.11M
Operating Cash Flow	218.65M	451.11M	354.14M	774.54M	694.83M
Investing Cash Flow	22.17M	-91.81M	-3.71B	-4.16B	-12.74M
Financing Cash Flow	-269.98M	-276.98M	3.27B	3.04B	-198.60M

Yuexiu Real Estate Investment Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.91
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0405, the sentiment is Positive. The current price of 0.91 is above the 20-day moving average (MA) of 0.88, above the 50-day MA of 0.81, and above the 200-day MA of 0.87, indicating a bullish trend. The MACD of 0.03 indicates Positive momentum. The RSI at 65.37 is Neutral, neither overbought nor oversold. The STOCH value of 81.11 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0405.

Yuexiu Real Estate Investment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6626	75 Outperform	HK$4.72B	12.47	10.03%	2.05%	17.83%	-28.88%
0435	74 Outperform	$4.02B	20.53	1.17%	7.97%	―	―
0405	64 Neutral	HK$4.68B	―	-2.11%	7.32%	-5.33%	-2880.00%
87001	61 Neutral	¥3.85B	―	-3.39%	0.69%	-3.16%	-28.30%
0808	59 Neutral	$2.16B	―	-1.09%	8.68%	-5.60%	-1261.11%
1426	56 Neutral	HK$2.51B	43.06	-0.78%	9.71%	-5.67%	40.95%
Sector *	54 Neutral	$1.23B	3.77	0.67%	6.13%	-2.39%	-129.28%