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

• Market Cap: HK$321.85M
• Dividend Yield: N/A
• Average Volume (3M): 226.27K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.30
• Revenue Growth: -30.68%
• EPS Growth: -63.06%
• Country: HK
• Employees: 116
• Sector: Communication Services
• Sector Strength: 84
• Industry: Entertainment
• EPS (TTM): -0.12
• Shares Outstanding: 906,632,260
• 10 Day Avg. Volume: 57,850
• 30 Day Avg. Volume: 226,266
• PEG Ratio: -0.14
• Price to Book (P/B): 0.71
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -2.15
• 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

• Rating: 52 Neutral
• Price Target: HK$0.50 ▲(42.86%Upside)

The overall score is influenced significantly by strong revenue growth and positive cash flow trends. However, ongoing profitability challenges and weak technical indicators weigh heavily, resulting in a moderate score. Valuation concerns due to negative earnings further impact the overall assessment.

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

Company Description

Universe Entertainment and Culture Group Company Limited, an investment holding company, engages in the film distribution and exhibition, and licensing and sub-licensing of film rights and television series businesses. It is also involved in the video distribution, and production of films and television series; leasing of investment properties; entertainment business; wholesale and retail of watches and optical products; and money lending and securities investment businesses. In addition, the company operates an advertising and model agency, and optical shops; licenses and sub-licenses of music programs; invests in concerts; manages contracted artistes; and provides financial printing services, including type-setting, translation, printing, design, distribution of financial print products, and other related services, as well as management services. It operates in Hong Kong, the People's Republic of China, rest of Asian countries, and internationally. The company was formerly known as Universe International Financial Holdings Limited and changed its name to Universe Entertainment and Culture Group Company Limited in October 2018. Universe Entertainment and Culture Group Company Limited was incorporated in 1999 and is headquartered in Kwai Chung, Hong Kong.

How the Company Makes Money

Universe Entertainment and Culture Group Company Limited generates revenue through multiple streams. The primary source of income is from film production and distribution, where the company produces and distributes films to theaters and various media platforms, earning from box office sales and licensing deals. Additionally, the company earns from music production and concert organization, which includes ticket sales, sponsorships, and merchandise. Artist management is another significant revenue stream, where the company manages artists and earns a commission on their earnings from performances and endorsements. The company also engages in multimedia services, offering digital content and advertising solutions that contribute to its earnings. Strategic partnerships with entertainment platforms and collaborations with other industry players further enhance its revenue potential.

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
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
317.86M	365.26M	198.44M	127.64M	602.60M	226.77M
	Gross Profit
41.85M	62.97M	29.41M	22.55M	239.91M	103.54M
	EBIT
-21.69M	-4.79M	-39.84M	-52.81M	160.95M	-18.22M
	EBITDA
-21.70M	218.55M	32.13M	-41.20M	392.02M	31.15M
	Net Income Common Stockholders
-105.24M	-30.44M	-92.76M	-76.55M	154.34M	-27.06M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
115.80M	133.67M	82.20M	219.38M	452.80M	218.89M
	Total Assets
526.48M	737.41M	951.57M	1.07B	1.05B	683.79M
	Total Debt
7.83M	11.14M	10.42M	13.26M	21.43M	15.47M
	Net Debt
-106.62M	-121.18M	-70.43M	-198.59M	-354.49M	-91.47M
	Total Liabilities
298.86M	435.02M	617.41M	645.76M	546.30M	328.90M
	Stockholders Equity
232.49M	306.82M	338.71M	431.63M	508.31M	355.70M
Cash Flow		Free Cash Flow
-30.91M	89.14M	-111.52M	-165.54M	173.09M	54.81M
	Operating Cash Flow
-29.95M	87.73M	19.05M	272.85M	459.97M	89.45M
	Investing Cash Flow
-22.73M	-27.38M	-141.17M	-427.08M	-179.05M	-148.54M
	Financing Cash Flow
-8.10M	-8.88M	-8.88M	-9.85M	-11.95M	-12.18M

Universe Entertainment and Culture Group Company Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.35
• 50DMA: Negative
• 100DMA: Negative
• 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:1046, the sentiment is Negative. The current price of 0.35 is below the 20-day moving average (MA) of 0.41, below the 50-day MA of 0.47, and below the 200-day MA of 0.36, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 36.49 is Neutral, neither overbought nor oversold. The STOCH value of 43.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 *	61 Neutral	$14.55B	5.92	-3.82%	8.36%	2.79%	-33.24%
1046	52 Neutral	HK$321.85M	―	-36.91%	―	-30.68%	-63.06%
2125	47 Neutral	HK$423.62M	―	-0.12%	―	30.84%	98.97%
0953	46 Neutral	HK$170.35M	―	-1.32%	―	-21.40%	-100.00%
0491	46 Neutral	HK$147.81M	―		―	-7.95%	-89.82%
0391	46 Neutral	HK$580.53M	―	-17.53%	―	27.72%	-117.07%
1159	37 Underperform	HK$360.68M	―		―	-49.75%	48.12%

Universe Entertainment and Culture Group Company Limited Corporate Events

Universe Entertainment Updates Share Option Schemes in 2024 Annual Report

Universe Entertainment and Culture Group Company Limited announced supplemental information to its 2024 Annual Report, detailing changes in its share option schemes. The Old Share Option Scheme expired in December 2023, with no remaining share options available for grant, while the New Share Option Scheme, effective from December 2023, allows for 90,663,227 share options to be granted, representing approximately 10% of the company’s issued shares. This update reflects the company’s strategic adjustments in its equity incentive plans, potentially impacting shareholder value and stakeholder engagement.