China Medical System Holdings (0867) AI Stock Analysis

• Market Cap: HK$34.64B
• Dividend Yield: 2.26%
• Average Volume (3M): 6.44M
• Price to Earnings (P/E): 19.4
• Beta (1Y): 0.91
• Revenue Growth: 11.78%
• EPS Growth: 19.06%
• Country: HK
• Employees: 6,141
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 0.43
• Shares Outstanding: 2,439,528,600
• 10 Day Avg. Volume: 4,711,227
• 30 Day Avg. Volume: 6,437,247
• PEG Ratio: -0.34
• Price to Book (P/B): 1.06
• Price to Sales (P/S): 2.30
• P/FCF Ratio: 21.18
• 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$16.83
• Price Target Upside: 20.50% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: HK$14.50 ▲(3.79% Upside)

The overall stock score of 65 reflects a stable financial foundation with low leverage and high equity, but is tempered by declining revenue and profitability. Technical indicators suggest bearish momentum, and while the valuation is reasonable, it does not compensate for the financial challenges. Improving revenue growth and cash flow generation are crucial for future performance.

China Medical System Holdings Business Overview & Revenue Model

Company Description

China Medical System Holdings Limited, an investment holding company, manufactures, sells, markets, and promotes pharmaceutical products in the People's Republic of China. The company's products include Plendil for the treatment of hypertension and stable angina pectoris; XinHuoSu for the treatment of acute heart failure; Deanxit for the treating mild-to-moderate depression, anxiety, and psychosomatic affections; Ursofalk for the treatment of cholesterol gallstones in the gallbladder, cholestatic liver disease, and biliary reflux gastritis; Salofalk for treating Ulcerative Colitis and Crohn's disease; Bioflor for the treatment of diarrhea; Combizym for dyspepsia; Augentropfen Stulln Mono eye drops to treat senile macula degeneration and asthenopia; and Hirudoid for blunt traumata with or without hematomas and superficial phlebitis insofar. Its products also comprise DanShenTong capsules for treating acne, tonsillitis, otitis externa, boils, carbuncle, traumatic infection, burn infection, mastitis, cellulitis, osteomyelitis, etc.; XiDaKang, a protein hydrolysate oral solution; YiNuoShu for treating respiratory diseases; Ganfule capsules for the treatment of primary cancer of the liver; Imdur for the treatment of coronary heart disease, chronic heart failure, and myocardial infarction, as well as for prevention of vasospasm and mixed angina; and Parlodel tablets for the endocrine and neuro system indications. In addition, the company also offers Elcatonin injection for osteoporosis; YinlianQinggan granules for treating acute hepatitis A and chronic hepatitis B; Lamisil tablets for treating fungal infections on skin and hair; and MOVICOL for treating chronic constipation and faecal impaction. In addition, it is involved in the agriculture and livestock activities. The company was founded in 1995 and is headquartered in North Point, Hong Kong. China Medical System Holdings Limited is a subsidiary of Treasure Sea Limited.

How the Company Makes Money

China Medical System generates revenue through multiple streams, primarily from the sale of its pharmaceutical products, which include both prescription and over-the-counter medications. The company benefits from a diverse product portfolio that allows it to cater to various therapeutic areas, driving sales growth. Furthermore, partnerships with international pharmaceutical companies enable the company to access new markets and innovative products, contributing to its revenue. Additionally, the company may engage in licensing agreements, where it receives royalties or upfront payments for the rights to distribute certain drugs, further enhancing its earnings. Overall, the combination of a robust product lineup, strategic collaborations, and effective market penetration strategies underpins China Medical System's revenue generation.

China Medical System Holdings Financial Statement Overview

Summary

China Medical System Holdings demonstrates stability in its balance sheet with low leverage and high equity. However, declining revenue and profitability over recent years pose a challenge for future growth. While operational efficiency remains strong, improving revenue growth and cash flow generation will be crucial for sustaining financial health.

Income Statement

The company has shown a declining trend in revenue from 2022 to 2024, with revenue decreasing by approximately 8.4% in 2023 and 6.8% in 2024. Gross profit margins remain strong, indicating effective cost management. However, the net profit margin in 2024 is lower than in previous years, reflecting a decrease in profitability. The lack of EBIT in 2024 is a concern, though EBITDA margins remain decent, showing continued operational efficiency.

Balance Sheet

The balance sheet is strong with a substantial equity base and a low debt-to-equity ratio, indicating low leverage risk. The equity ratio is high, showcasing financial stability. The high return on equity indicates effective use of equity to generate profits, although it has been decreasing over the years, signaling a need for improvement in generating returns.

Cash Flow

Operating cash flow has decreased significantly from previous years, which is a concern. The free cash flow to net income ratio remains robust, indicating healthy cash generation relative to net income. However, the free cash flow has also declined in 2024 compared to 2022, suggesting potential challenges in future cash availability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.86B	7.47B	8.01B	9.15B	8.34B	6.95B
Gross Profit	5.62B	5.42B	6.11B	7.04B	6.25B	5.13B
EBITDA	2.30B	2.31B	2.92B	3.76B	3.70B	3.05B
Net Income	1.65B	1.62B	2.40B	3.26B	3.02B	2.53B
Balance Sheet
Total Assets	18.94B	18.05B	17.73B	17.75B	15.81B	12.70B
Cash, Cash Equivalents and Short-Term Investments	5.97B	5.87B	6.14B	5.87B	4.36B	2.67B
Total Debt	747.60M	860.74M	1.30B	1.81B	1.71B	600.16M
Total Liabilities	1.77B	1.64B	2.17B	3.02B	2.96B	1.60B
Stockholders Equity	17.02B	16.31B	15.52B	14.59B	12.75B	11.03B
Cash Flow
Free Cash Flow	493.64M	812.64M	2.18B	3.03B	2.31B	2.35B
Operating Cash Flow	952.52M	1.27B	2.50B	3.55B	2.49B	2.69B
Investing Cash Flow	-439.01M	-615.10M	-442.28M	-1.18B	-1.52B	-353.82M
Financing Cash Flow	-983.08M	-1.26B	-2.13B	-1.40B	-258.39M	-1.03B

China Medical System Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 13.97
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0867, the sentiment is Positive. The current price of 13.97 is above the 20-day moving average (MA) of 13.37, above the 50-day MA of 13.52, and above the 200-day MA of 11.97, indicating a bullish trend. The MACD of 0.04 indicates Negative momentum. The RSI at 60.41 is Neutral, neither overbought nor oversold. The STOCH value of 91.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0867.

China Medical System Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0874	75 Outperform	HK$43.86B	9.48	7.86%	7.15%	1.13%	-13.53%
0512	73 Outperform	HK$28.04B	13.30	12.65%	3.13%	10.56%	-13.58%
1513	71 Outperform	HK$33.02B	11.57	14.91%	4.09%	-0.45%	9.00%
3320	68 Neutral	HK$28.96B	9.52	5.90%	2.95%	―	―
0867	65 Neutral	HK$34.64B	19.36	10.01%	2.26%	11.78%	19.06%
3933	64 Neutral	HK$23.60B	6.58	21.02%	5.11%	0.39%	4.94%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

China Medical System Holdings Corporate Events

China Medical System’s Breakthrough in Vitiligo Treatment with Povorcitinib

China Medical System Holdings announced that its subsidiary, Dermavon Holdings, has obtained licensing rights for the innovative oral JAK 1 inhibitor, povorcitinib, which has been included in China’s list of Breakthrough Therapeutic Drugs. This inclusion is expected to accelerate the drug’s development and review process, potentially offering a new treatment option for non-segmental vitiligo patients in China. The drug is currently in Phase 3 clinical trials for various skin conditions outside China and has shown promising results in improving skin repigmentation. If approved, povorcitinib could enhance Dermavon’s product portfolio and provide comprehensive treatment options for vitiligo patients.

The most recent analyst rating on (HK:0867) stock is a Hold with a HK$14.50 price target. To see the full list of analyst forecasts on China Medical System Holdings stock, see the HK:0867 Stock Forecast page.

China Medical System’s Innovative Stroke Treatment Gains Regulatory Acceptance

China Medical System Holdings Limited announced that its New Drug Application for Y-3 for Injection, a Class 1 innovative drug for treating acute ischemic stroke, has been accepted by China’s National Medical Products Administration. This drug, noted as the world’s first brain cytoprotectant targeting PSD-95-nNOS and MPO, shows promise in improving treatment outcomes for stroke patients and potentially preventing post-stroke depression and anxiety. The Phase III clinical trial in China demonstrated significant clinical benefits and a favorable safety profile, indicating broad market prospects given the high incidence of stroke in China.

The most recent analyst rating on (HK:0867) stock is a Hold with a HK$14.50 price target. To see the full list of analyst forecasts on China Medical System Holdings stock, see the HK:0867 Stock Forecast page.

China Medical System’s New Drug Application for Atopic Dermatitis Accepted in China

China Medical System Holdings has announced that its subsidiary, Dermavon Holdings, has had its new drug application for MG-K10, a long-acting anti-IL-4Rα humanized monoclonal antibody injection, accepted by China’s National Medical Products Administration. This drug, intended for treating moderate-to-severe atopic dermatitis, has shown promising results in clinical trials and is expected to enhance patient adherence due to its four-week dosing schedule. If approved, MG-K10 will enrich the company’s dermatological product portfolio and strengthen Dermavon’s market competitiveness.

The most recent analyst rating on (HK:0867) stock is a Hold with a HK$14.50 price target. To see the full list of analyst forecasts on China Medical System Holdings stock, see the HK:0867 Stock Forecast page.

China Medical System Secures Distribution Rights for Key Ophthalmic Drugs in China

China Medical System Holdings Limited has entered into a Distribution Agreement with Novartis Pharma Services AG for the exclusive rights to distribute Lucentis® and Beovu® in mainland China. This agreement enhances the company’s portfolio in the ophthalmic drug market, allowing it to capitalize on the growing demand for anti-VEGF drugs in China, projected to expand significantly by 2030. The inclusion of Lucentis®, a well-established treatment for ocular neovascular diseases, and Beovu®, a novel treatment for diabetic macular edema, strengthens the company’s position in the ophthalmic sector and offers potential growth opportunities.

The most recent analyst rating on (HK:0867) stock is a Hold with a HK$14.50 price target. To see the full list of analyst forecasts on China Medical System Holdings stock, see the HK:0867 Stock Forecast page.