Universe Entertainment and Culture Group Company Limited (1046) AI Stock Analysis

• Market Cap: HK$376.25M
• Dividend Yield: N/A
• Average Volume (3M): 397.79K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.45
• Revenue Growth: 29.39%
• EPS Growth: -107.44%
• Country: HK
• Employees: 116
• Sector: Communication Services
• Sector Strength: 97
• Industry: Entertainment
• EPS (TTM): 0.01
• Shares Outstanding: 906,632,260
• 10 Day Avg. Volume: 1,010,550
• 30 Day Avg. Volume: 397,791
• PEG Ratio: -0.05
• Price to Book (P/B): 1.31
• Price to Sales (P/S): 0.67
• P/FCF Ratio: 0.00
• 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$0.50
• Price Target Upside: 16.28% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 51 Neutral
• Price Target: HK$0.50 ▲(16.28% Upside)

The stock score is primarily influenced by the company's strong revenue growth and improved cash flow, which are promising for future performance. However, significant challenges in profitability and negative earnings weigh heavily on its valuation. Technical indicators suggest neutral to bearish momentum, adding caution to potential investments. The absence of dividend yield and negative P/E ratio further impact the score negatively.

Universe Entertainment and Culture Group Company Limited Business Overview & Revenue Model

Company Description

Universe Entertainment and Culture Group Company Limited (1046) is a diversified entertainment company based in Hong Kong. The company operates in multiple sectors, including film and television production, distribution, and exhibition, as well as music production and publishing. Additionally, the company is involved in artist management, live entertainment events, and other related cultural and entertainment activities.

How the Company Makes Money

Universe Entertainment and Culture Group Company Limited generates revenue through various streams within the entertainment industry. Key revenue sources include box office receipts from film distribution and exhibition, sales and licensing of television content, and music royalties. The company's artist management division earns commissions from talent representation and related services. Live entertainment events such as concerts and performances contribute to its income, along with merchandising and promotional partnerships. Strategic collaborations and distribution deals with other entertainment entities also play a significant role in the company's earnings.

Universe Entertainment and Culture Group Company Limited Financial Statement Overview

Summary

Universe Entertainment and Culture Group Company Limited shows significant revenue growth and improvements in cash flow, but faces challenges with profitability and consistent earnings. The balance sheet is stable with low leverage, yet the negative return on equity highlights ongoing profitability issues. Overall, while growth prospects are promising, the company needs to address profitability to enhance financial health.

Income Statement

The company shows a significant improvement in revenue from the previous year, indicating strong growth potential. However, despite the increase in revenue, the company remains unprofitable with negative net income and EBIT. The gross profit margin has slightly improved, yet the net profit margin remains negative, highlighting ongoing challenges in achieving profitability.

Balance Sheet

The company has a strong equity base with a relatively low debt-to-equity ratio, indicating good financial stability. The equity ratio shows a healthy proportion of equity in the company's asset structure. However, the return on equity is negative due to the net loss, which is a concern for shareholder returns.

Cash Flow

The company has demonstrated a strong recovery in free cash flow, moving from negative to positive, indicating improved cash generation. The operating cash flow to net income ratio is robust, suggesting efficient cash management. However, the reliance on operating activities for cash flow might indicate vulnerabilities if operational performance declines.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	472.59M	365.26M	198.44M	127.64M	602.60M
Gross Profit	68.09M	62.97M	29.23M	22.55M	239.91M
EBITDA	9.71M	218.55M	32.13M	-41.20M	392.02M
Net Income	-63.19M	-30.44M	-92.76M	-76.55M	154.34M
Balance Sheet
Total Assets	435.70M	737.41M	951.57M	1.07B	1.05B
Cash, Cash Equivalents and Short-Term Investments	140.50M	133.67M	82.20M	219.38M	452.80M
Total Debt	7.10M	11.14M	10.42M	13.26M	21.43M
Total Liabilities	197.95M	435.02M	617.41M	645.76M	546.30M
Stockholders Equity	241.30M	306.82M	338.71M	431.63M	508.31M
Cash Flow
Free Cash Flow	0.00	86.63M	-111.52M	-165.54M	173.09M
Operating Cash Flow	0.00	87.73M	19.05M	272.85M	459.97M
Investing Cash Flow	0.00	-27.38M	-141.17M	-427.08M	-179.05M
Financing Cash Flow	0.00	-8.88M	-8.88M	-9.85M	-11.95M

Universe Entertainment and Culture Group Company Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.43
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1046, the sentiment is Positive. The current price of 0.43 is above the 20-day moving average (MA) of 0.35, above the 50-day MA of 0.34, and above the 200-day MA of 0.38, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 71.71 is Negative, neither overbought nor oversold. The STOCH value of 69.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1046.

Universe Entertainment and Culture Group Company Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
1046	51 Neutral	HK$376.25M	―	-23.06%	―	29.39%	-107.44%
0953	51 Neutral	HK$383.29M	275.00	0.29%	―	206.38%	―
1159	46 Neutral	HK$380.18M	1.91	―	―	-57.01%	―
2125	46 Neutral	HK$423.62M	―	-2.12%	―	-41.22%	54.66%
0491	46 Neutral	HK$128.53M	―	―	―	-2.81%	80.19%
0391	45 Neutral	HK$544.98M	―	-20.32%	―	-6.36%	-166.67%

Universe Entertainment and Culture Group Company Limited Corporate Events

Universe Entertainment Issues Profit Warning Amid Increased Losses

Universe Entertainment and Culture Group Company Limited has issued a profit warning, expecting a significant increase in losses for the year ending June 30, 2025, compared to the previous year. The anticipated loss, ranging from HK$57.0 million to HK$67.0 million, is attributed to a substantial impairment loss on film rights and related assets due to decreased income expectations. Stakeholders are advised to exercise caution as the annual results are still being finalized.

Universe Entertainment Sets Nomination Committee Guidelines

Universe Entertainment and Culture Group Company Limited has announced the terms of reference for its Nomination Committee, which was originally established in 2005. The committee, consisting primarily of independent non-executive directors, is responsible for nominating board members and ensuring proper governance. The announcement outlines the committee’s structure, meeting protocols, and responsibilities, which are aimed at enhancing the company’s governance framework.