Rare Earth Magnesium Technology Group Holdings Ltd. (0601) AI Stock Analysis

• Market Cap: HK$55.11M
• Dividend Yield: N/A
• Average Volume (3M): 5.32M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.95
• Revenue Growth: -13.76%
• EPS Growth: -1.08%
• Country: HK
• Employees: 340
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Industrial Materials
• EPS (TTM): -0.11
• Shares Outstanding: 592,595,100
• 10 Day Avg. Volume: 13,656,533
• 30 Day Avg. Volume: 5,323,465
• PEG Ratio: 0.01
• Price to Book (P/B): 0.40
• Price to Sales (P/S): 0.26
• P/FCF Ratio: -3.41
• 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: 45 Neutral
• Price Target: HK$0.09 ▲(8.75% Upside)

The overall stock score is primarily impacted by the company's poor financial performance, with significant challenges in revenue, profitability, and leverage. Technical analysis provides some short-term positive signals, but the lack of profitability and dividend yield weighs heavily on the valuation score.

Positive Factors

Market Position

Rare Earth Magnesium Technology Group Holdings Ltd. holds a strategic position in the industrial materials sector, supplying essential components for high-tech industries like automotive and aerospace. This positions the company to benefit from long-term demand for lightweight and high-strength materials.

Product Demand

The increasing global demand for lightweight and high-strength materials in various industries supports the company's revenue potential. As industries like automotive and electronics continue to seek advanced materials, the company is well-positioned to capitalize on these trends.

Cash Stability

Despite financial challenges, the company's stable cash position relative to liabilities provides a buffer against immediate liquidity issues, allowing it to potentially navigate through restructuring and operational improvements.

Negative Factors

Revenue Decline

A consistent decline in revenue over several years indicates challenges in maintaining market share or pricing power, which could impact long-term growth and profitability unless addressed strategically.

High Leverage

High leverage increases financial risk, limiting the company's ability to invest in growth opportunities and making it vulnerable to economic downturns or interest rate hikes, potentially affecting long-term sustainability.

Negative Profitability

Negative profitability indicates operational inefficiencies and cost management issues, which can erode financial health over time if not addressed, impacting the company's ability to reinvest in growth and innovation.

Rare Earth Magnesium Technology Group Holdings Ltd. Business Overview & Revenue Model

Company Description

Rare Earth Magnesium Technology Group Holdings Limited, an investment holding company, develops, manufactures, and sells magnesium alloy new material products in Mainland China and Europe. It also operates a dolomite mine in Baishan City, Jilin Province. The company was formerly known as Group Sense (International) Limited and changed its name to Rare Earth Magnesium Technology Group Holdings Limited in July 2018. Rare Earth Magnesium Technology Group Holdings Limited was incorporated in 1992 and is based in Tsim Sha Tsui, Hong Kong. Rare Earth Magnesium Technology Group Holdings Limited is a subsidiary of Ming Xin Developments Limited.

How the Company Makes Money

Rare Earth Magnesium Technology Group Holdings Ltd. generates revenue primarily through the sale of high-purity magnesium products and related technologies. Key revenue streams include the direct sale of magnesium ingots, alloys, and other derivatives to manufacturers across industries such as automotive and aerospace, where lightweight materials are increasingly in demand. The company may also engage in partnerships with other firms or research institutions to develop new applications and technologies for magnesium usage, which can lead to additional revenue opportunities. Factors contributing to its earnings include the global demand for lightweight materials, advancements in magnesium production technology, and the company's focus on sustainable practices that appeal to environmentally-conscious consumers.

Rare Earth Magnesium Technology Group Holdings Ltd. Financial Statement Overview

Summary

The company faces significant financial challenges with declining revenues, negative profitability, high leverage, and shrinking assets. The income statement shows a significant decline in total revenue and consistent negative net income. The balance sheet reflects a high debt-to-equity ratio, and cash flow analysis reveals volatility and negative free cash flow.

Income Statement

The income statement shows a significant decline in total revenue from 2019 to 2024, with consistent negative net income in recent years. The gross profit margin has turned negative, reflecting operational inefficiencies or cost challenges. The revenue growth has been negative, indicating a downward trajectory. The negative EBIT and EBITDA margins further highlight operational challenges and lack of profitability.

Balance Sheet

The balance sheet reflects a high debt-to-equity ratio, signaling potential leverage risk. Equity has significantly decreased over the years, reducing the equity ratio. The company's total assets have declined, indicating a shrinking asset base. However, there is some stability in cash and cash equivalents compared to liabilities, which slightly offsets the high leverage concerns.

Cash Flow

Cash flow analysis reveals volatility, with operating cash flow significantly reduced over the years. Free cash flow has been negative in recent years, indicating cash generation issues. The operating cash flow to net income ratio has deteriorated, suggesting inefficiencies in converting revenue into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	230.20M	242.70M	263.49M	383.90M	416.06M	744.84M
Gross Profit	-40.06M	-51.38M	-85.28M	46.61M	68.78M	130.17M
EBITDA	-34.01M	-270.82M	-269.24M	139.59M	-147.74M	132.72M
Net Income	-394.11M	-408.42M	-423.60M	1.40M	-331.88M	-74.01M
Balance Sheet
Total Assets	1.03B	1.03B	1.44B	1.87B	2.36B	2.56B
Cash, Cash Equivalents and Short-Term Investments	9.92M	24.73M	39.95M	38.30M	25.48M	36.10M
Total Debt	749.14M	724.41M	682.02M	640.15M	876.04M	872.32M
Total Liabilities	895.62M	869.68M	829.57M	777.22M	1.17B	1.10B
Stockholders Equity	136.50M	155.49M	612.96M	1.10B	1.19B	1.45B
Cash Flow
Free Cash Flow	-34.66M	-18.43M	7.71M	22.66M	-6.61M	-72.42M
Operating Cash Flow	-7.42M	11.14M	35.78M	28.08M	106.70M	29.79M
Investing Cash Flow	-27.70M	-22.13M	-12.85M	-1.42M	-105.82M	-93.36M
Financing Cash Flow	-5.46M	-7.91M	-699.00K	-21.98M	-15.06M	-148.01M

Rare Earth Magnesium Technology Group Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.08
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0601, the sentiment is Positive. The current price of 0.08 is below the 20-day moving average (MA) of 0.09, below the 50-day MA of 0.09, and below the 200-day MA of 0.08, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 59.79 is Neutral, neither overbought nor oversold. The STOCH value of 75.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0601.

Rare Earth Magnesium Technology Group Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2623	66 Neutral	HK$1.58B	19.02	14.56%	―	-70.82%	5182.22%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
0769	55 Neutral	HK$1.95B	-15.63	―	―	10.29%	47.66%
0601	45 Neutral	HK$55.11M	-0.14	―	―	-13.76%	-1.08%
2237	44 Neutral	HK$544.00M	-61.82	-1.88%	―	-23.72%	-196.49%
0433	41 Neutral	HK$1.14B	-3.58	-4702.63%	―	0.41%	83.35%
6128	38 Underperform	HK$249.45M	-1.23	-23.14%	―	-27.07%	47.86%

Rare Earth Magnesium Technology Group Holdings Ltd. Corporate Events

Rare Earth Magnesium Announces Change in Share Registrar Office

Rare Earth Magnesium Technology Group Holdings Ltd. announced a change in its branch share registrar and transfer office in Hong Kong, effective December 30, 2025. This transition to Tricor Investor Services Limited represents an operational update aimed at streamlining share registration and transfer services. Stakeholders and shareholders are advised of the new office location and procedures for processing share-related matters after the specified date.

The most recent analyst rating on (HK:0601) stock is a Hold with a HK$0.09 price target. To see the full list of analyst forecasts on Rare Earth Magnesium Technology Group Holdings Ltd. stock, see the HK:0601 Stock Forecast page.