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Fortune Real Estate Investment Trust (HK:0778)
:0778

Fortune Real Estate Investment (0778) AI Stock Analysis

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HK

Fortune Real Estate Investment

(OTC:0778)

Rating:50Neutral
Price Target:
Fortune Real Estate Investment's financial performance is challenged by declining revenues and net losses, with increasing debt levels posing potential risks. Technical indicators suggest a neutral market stance, lacking clear momentum. Valuation is concerning due to negative earnings and a high dividend yield that might not be sustainable. These factors contribute to a moderate overall stock score.
Positive Factors
Distribution Yields
Fortune REIT offers distribution yields of 8.1-8.2% for FY25-26.
Long-term Growth
Population growth serves as long-term growth driver.
Portfolio Occupancy
Improving portfolio occupancy led by ramp up at +WOO.
Negative Factors
Earnings Decline
FY24 distributable income fell 11% y/y to HKD723mn on lower rental earnings and higher cash finance cost.
Local Consumption
Any deterioration in local consumption would impact leasing demand for retail space and hence weigh on the REIT’s earnings outlook.

Fortune Real Estate Investment (0778) vs. iShares MSCI Hong Kong ETF (EWH)

Fortune Real Estate Investment Business Overview & Revenue Model

Company DescriptionFortune Real Estate Investment (0778) is a real estate investment company that primarily engages in the acquisition, development, and management of high-quality real estate properties. The company focuses on sectors such as commercial, residential, and retail properties, aiming to deliver sustainable and long-term value to its investors. Fortune Real Estate Investment is committed to enhancing the value of its property portfolio through strategic investments and efficient asset management practices.
How the Company Makes MoneyFortune Real Estate Investment makes money primarily through rental income generated from its portfolio of commercial, residential, and retail properties. The company also earns revenue from property appreciation and sales, as it strategically buys and sells properties to maximize returns. Additionally, it may engage in property development projects that, upon completion, provide substantial returns either through direct sales or by enhancing rental income potential. Key partnerships with financial institutions and real estate developers can also contribute to revenue by providing favorable financing terms and opportunities for joint ventures. The company's earnings are influenced by market conditions, property values, and economic factors that affect demand for real estate.

Fortune Real Estate Investment Financial Statement Overview

Summary
Fortune Real Estate Investment faces financial challenges with declining revenues and significant net losses. While cash flows are managed well, the company's increasing debt may pose risks if revenue and profitability do not improve.
Income Statement
40
Negative
The company has experienced a decline in revenue over recent years with a negative net profit margin, indicating financial strain. Gross profit margin remains relatively stable, but consistent net losses are concerning.
Balance Sheet
55
Neutral
The company maintains a reasonable debt-to-equity ratio, suggesting manageable leverage. However, declining stockholders' equity and increasing total debt might pose risks if trends continue.
Cash Flow
60
Neutral
Operating cash flow remains strong compared to net income, indicating good cash management despite the net losses. However, the lack of free cash flow growth is a concern.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
1.75B1.79B1.76B1.81B1.84B
Gross Profit
1.15B1.17B1.17B1.21B1.24B
EBIT
1.13B1.17B998.71M1.55B-2.58B
EBITDA
1.14B1.16B998.71M1.55B-2.58B
Net Income Common Stockholders
-518.98M-154.92M502.64M1.32B-3.19B
Balance SheetCash, Cash Equivalents and Short-Term Investments
96.65M106.72M206.86M117.96M177.17M
Total Assets
38.46B39.51B40.34B39.72B39.34B
Total Debt
9.81B9.66B9.58B8.84B8.76B
Net Debt
9.72B9.55B9.37B8.72B8.58B
Total Liabilities
11.53B11.43B11.41B10.54B10.70B
Stockholders Equity
26.93B28.08B28.93B29.18B28.63B
Cash FlowFree Cash Flow
1.03B1.05B1.00B1.02B925.08M
Operating Cash Flow
1.03B1.16B1.17B1.09B980.00M
Investing Cash Flow
-84.68M-113.09M-672.93M-66.97M-54.76M
Financing Cash Flow
-957.16M-1.15B-409.93M-1.08B-884.45M

Fortune Real Estate Investment Technical Analysis

Technical Analysis Sentiment
Positive
Last Price4.46
Price Trends
50DMA
4.24
Positive
100DMA
4.10
Positive
200DMA
4.02
Positive
Market Momentum
MACD
0.06
Positive
RSI
58.49
Neutral
STOCH
49.31
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0778, the sentiment is Positive. The current price of 4.46 is below the 20-day moving average (MA) of 4.47, above the 50-day MA of 4.24, and above the 200-day MA of 4.02, indicating a neutral trend. The MACD of 0.06 indicates Positive momentum. The RSI at 58.49 is Neutral, neither overbought nor oversold. The STOCH value of 49.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0778.

Fortune Real Estate Investment Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
61
Neutral
$2.81B10.770.40%8439.00%5.73%-20.81%
53
Neutral
$58.96B66.170.47%6.84%-2.96%-81.31%
51
Neutral
$12.04B-4.63%7.98%-4.61%-1035.60%
50
Neutral
HK$9.12B-1.89%8.55%-2.76%-238.04%
33
Underperform
$4.72B-29.26%-51.37%29.94%
31
Underperform
$3.53B-71.13%-50.18%12.86%
* Real Estate Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:0778
Fortune Real Estate Investment
4.56
0.84
22.71%
HK:2777
Guangzhou R&F Properties Co
0.97
0.01
1.04%
HK:3380
Logan Property Holdings Co
0.85
0.18
26.87%
HK:2778
Champion Real Estate Investment
2.05
0.49
31.83%
HK:1997
Wharf Real Estate Investment Co
20.05
-0.99
-4.71%
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.