SJM Holdings (0880) AI Stock Analysis

• Market Cap: $23.51B
• Dividend Yield: N/A
• Average Volume (3M): 30.47M
• Price to Earnings (P/E): 8175.0
• Beta (1Y): 0.80
• Revenue Growth: 31.24%
• EPS Growth: N/A
• Country: HK
• Employees: 20,400
• Sector: Consumer Cyclical
• Sector Strength: 80
• Industry: Gambling, Resorts & Casinos
• EPS (TTM): 0.01
• Shares Outstanding: 7,101,805,000
• 10 Day Avg. Volume: 21,912,415
• 30 Day Avg. Volume: 30,472,104
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: $2.42
• Price Target Upside: -25.91% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 6

• Rating: 50 Neutral
• Price Target: HK$3.50 ▲(7.03% Upside)

SJM Holdings' stock score is influenced primarily by financial performance challenges and valuation concerns. Despite a strong revenue recovery, high leverage, low profitability, and an exceptionally high P/E ratio pose significant risks. While technical indicators suggest bullish momentum, the overbought condition could lead to potential corrections.

SJM Holdings Business Overview & Revenue Model

Company Description

SJM Holdings Limited, an investment holding company, owns, develops, and operates casinos and related facilities in Macau, Hong Kong, and internationally. It operates through two segments, Gaming Operations; and Hotel, Catering, Retail and Leasing Operations. The Gaming Operations segment engages in the VIP gaming, mass market table gaming, slot machine, and other gaming operations. The Hotel, Catering, Retail, and Leasing Operations segment operates a hotel; and offers catering, retail, leasing and related activities. SJM Holdings Limited also provides marketing and promotion, property development, casino operations management, dredging, gaming promotion, human resources and project management, food and beverage, treasury, and hospitality services. The company was incorporated in 2006 and is based in Central, Hong Kong. SJM Holdings Limited is a subsidiary of Sociedade de Turismo e Diversões de Macau, S.A.

How the Company Makes Money

SJM Holdings makes money primarily through its gaming operations, which include a variety of casino games such as baccarat, blackjack, and slot machines. The company generates revenue from both VIP gaming and mass market gaming segments. VIP gaming involves high-stakes players, often facilitated through junket operators who bring in clients and extend credit, while the mass market segment caters to a broader customer base with lower stakes. Apart from gaming, SJM Holdings also earns income through its hospitality services, including hotel accommodations, food and beverage sales, and retail operations within its integrated resorts. Key factors contributing to its earnings include its strategic location in Macau, partnerships with junket operators, and its ability to attract both high-end and mass-market customers.

SJM Holdings Financial Statement Overview

Summary

SJM Holdings shows a strong revenue rebound post-pandemic but struggles with profitability and cash flow management. High leverage and low equity returns increase financial risks.

Income Statement

SJM Holdings has shown a significant recovery in revenue, with a growth rate of approximately 119% from 2023 to 2024, indicating strong revenue recovery post-pandemic. However, profitability remains a concern as the net profit margin is close to zero in 2024, reflecting minimal net income relative to revenue. EBIT and EBITDA margins have improved to 6.2% and 12.2% respectively, yet still show room for strengthening profitability.

Balance Sheet

The company's debt-to-equity ratio is relatively high at 1.97, indicating a high level of leverage which could pose financial risks if not managed properly. The equity ratio is 28.6%, suggesting a moderate reliance on equity financing. Return on Equity is low at 0.02%, highlighting minimal returns for shareholders despite improved revenues.

Cash Flow

The absence of operating and free cash flow in 2024 is concerning, indicating potential liquidity issues. However, previous years showed positive free cash flow, which suggests that cash flow management needs attention. The lack of recent cash flow data limits further analysis, highlighting the need for improved cash management strategies.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	17.24B	13.14B	4.00B	10.08B	7.51B
Gross Profit	16.50B	12.50B	3.60B	5.55B	3.93B
EBITDA	3.92B	1.93B	-4.77B	-2.59B	-2.14B
Net Income	3.20M	-2.01B	-7.85B	-4.14B	-3.02B
Balance Sheet
Total Assets	48.72B	49.74B	52.65B	49.91B	52.72B
Cash, Cash Equivalents and Short-Term Investments	2.21B	3.54B	6.86B	3.20B	6.13B
Total Debt	27.46B	28.75B	32.43B	23.86B	20.24B
Total Liabilities	34.55B	35.65B	36.63B	29.50B	28.08B
Stockholders Equity	13.92B	13.36B	16.00B	20.34B	24.53B
Cash Flow
Free Cash Flow	2.30B	2.11B	-5.29B	-5.99B	-10.94B
Operating Cash Flow	4.06B	3.80B	-4.22B	-4.54B	-7.49B
Investing Cash Flow	-1.41B	-1.27B	-2.02B	-787.70M	2.54B
Financing Cash Flow	-3.74B	-5.71B	9.49B	3.04B	1.52B

SJM Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.27
• 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:0880, the sentiment is Positive. The current price of 3.27 is above the 20-day moving average (MA) of 3.26, above the 50-day MA of 2.95, and above the 200-day MA of 2.59, indicating a bullish trend. The MACD of 0.09 indicates Positive momentum. The RSI at 58.51 is Neutral, neither overbought nor oversold. The STOCH value of 52.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0880.

SJM Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$17.16B	12.39	-5.32%	3.05%	1.51%	-15.30%
0880	50 Neutral	$23.51B	8,175.00	0.03%	―	31.24%	―
MDEVF	―	$1.43B	―	-220.97%	―	―	―
MCHVF	―	$7.61B	14.10	452.88%	3.53%	―	―
GXYEF	―	$22.56B	17.97	12.59%	2.52%	―	―
SCHYF	―	$21.04B	20.83	111.35%	1.35%	―	―
WYNMF	―	$4.51B	19.03		3.77%	―	―

SJM Holdings Corporate Events

SJM Holdings Expands with Hengqin Property Acquisition

SJM Holdings has announced the acquisition of a property in Hengqin for RMB724.20 million, which will be converted into a 3-star hotel. This strategic move aims to expand SJM’s market reach by attracting budget-conscious travelers, diversifying its portfolio, and increasing revenue streams. The location’s proximity to Macau and access to the Mainland China market presents significant growth potential, while the operation of a 3-star hotel could result in lower operating costs and potential cost synergies.

The most recent analyst rating on (HK:0880) stock is a Sell with a HK$2.85 price target. To see the full list of analyst forecasts on SJM Holdings stock, see the HK:0880 Stock Forecast page.

SJM Holdings Successfully Passes All AGM Resolutions

SJM Holdings Limited announced that all resolutions proposed at its 2025 Annual General Meeting were successfully passed by shareholders. Key resolutions included the re-election of directors, approval of financial statements, and authorization for the board to manage director remuneration and share transactions. This outcome underscores shareholder confidence in the company’s leadership and strategic direction, potentially strengthening its position in the competitive gaming industry.

The most recent analyst rating on (HK:0880) stock is a Sell with a HK$2.85 price target. To see the full list of analyst forecasts on SJM Holdings stock, see the HK:0880 Stock Forecast page.

SJM Holdings to Restructure Satellite Casino Operations in Macau

SJM Holdings Limited announced plans to acquire properties for Casino L’Arc Macau and Casino Ponte 16 as part of its strategy to align with revised Macau gaming laws. The company will cease operations at seven satellite casinos by the end of 2025, reallocating gaming resources to its directly owned casinos. SJM is committed to maintaining local employment, offering job opportunities within its portfolio to affected workers. The Board does not foresee any significant adverse effects on the company’s operations or profitability due to these changes.

The most recent analyst rating on (HK:0880) stock is a Sell with a HK$2.85 price target. To see the full list of analyst forecasts on SJM Holdings stock, see the HK:0880 Stock Forecast page.