Huazhang Technology Holding Ltd. (1673) AI Stock Analysis

• Market Cap: HK$363.92M
• Dividend Yield: N/A
• Average Volume (3M): 300.13K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.32
• Revenue Growth: -14.00%
• EPS Growth: 87.71%
• Country: HK
• Employees: 227
• Sector: Industrials
• Sector Strength: 88
• Industry: Industrial - Machinery
• EPS (TTM): >-0.01
• Shares Outstanding: 1,596,134,000
• 10 Day Avg. Volume: 456,400
• 30 Day Avg. Volume: 300,133
• PEG Ratio: 0.08
• Price to Book (P/B): 0.97
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -2.76
• 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: 44 Neutral
• Price Target: HK$0.00 ▼(-100.00%Downside)

Huazhang Technology Holding Ltd.'s overall stock score is primarily impacted by financial instability, with consistent net losses and negative cash flows being significant concerns. While there is short-term technical momentum, the potential overvaluation poses risks. The poor valuation, driven by a negative P/E ratio and lack of dividend yield, further weighs down the score.

Huazhang Technology Holding Ltd. Business Overview & Revenue Model

Company Description

Huazhang Technology Holding Limited, an investment holding company, engages in the research, development, manufacture, and sale of industrial automation systems and sludge treatment products in the People's Republic of China. It operates through four segments: Industrial Products, Project Contracting Services, Environmental Products, and Supporting Services. The company offers paper-making machines and equipment; design, procurement, and installation services; and wastewater treatment and waste recycling services. It also provides after-sales services; computer software and hardware, and technical services; and logistics and warehousing services, as well as trades in electronic parts. In addition, Huazhang Technology Holding Limited engages in the design, manufacture, and sale of pulping and papermaking equipment and provision of the after-sales services. The company was founded in 1993 and is headquartered in Hangzhou, China. Huazhang Technology Holding Limited is a subsidiary of Florescent Holdings Limited.

How the Company Makes Money

Huazhang Technology Holding Ltd. generates revenue through the sale of its industrial automation systems and environmental protection equipment. The company earns a significant portion of its income from contracts with paper manufacturers who seek to improve operational efficiency and comply with stringent environmental regulations. Revenue streams include the design and installation of custom automation systems, sales of sludge treatment and wastewater management products, and after-sales services such as maintenance and system upgrades. Strategic partnerships with leading paper manufacturing firms and ongoing technological innovation further contribute to the company's earnings.

Huazhang Technology Holding Ltd. Financial Statement Overview

Summary

Huazhang Technology Holding Ltd. is experiencing financial instability marked by consistent net losses and negative cash flows. While the balance sheet shows moderate leverage, the inability to generate positive cash flows and net income poses significant risks. The company's profitability and operational efficiency need improvement to achieve financial stability.

Income Statement

The company is facing negative profitability metrics with a net loss reported consistently over the periods. The Gross Profit Margin for the TTM stands at 19.4%, but the Net Profit Margin remains negative due to significant losses. Revenue has shown volatility, with the latest TTM revenue showing a decrease. The EBIT and EBITDA margins are also negative, indicating operating challenges.

Balance Sheet

The company's balance sheet shows a moderate financial structure with a Debt-to-Equity Ratio of 0.25 in the TTM, indicating manageable leverage. The Equity Ratio is 44.2%, reflecting reasonable stability. However, the negative net income impacts the Return on Equity, which is also negative, pointing to inefficiencies in generating returns for shareholders.

Cash Flow

The company faces cash flow challenges with negative Operating Cash Flow in the TTM. Free Cash Flow is also negative, reflecting difficulties in generating cash from core operations. The Operating Cash Flow to Net Income and Free Cash Flow to Net Income ratios are negative, underscoring the cash flow issues.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
476.72M	448.04M	528.92M	323.87M	496.91M	368.16M
	Gross Profit
92.49M	79.72M	83.16M	33.15M	105.63M	74.20M
	EBIT
-7.78M	-18.23M	-38.24M	-318.94M	45.46M	-72.72M
	EBITDA
727.72K	3.26M	-23.41M	-306.34M	60.42M	-53.96M
	Net Income Common Stockholders
-7.33M	-18.73M	-51.25M	-363.75M	17.98M	-77.50M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
184.95M	208.82M	77.33M	184.14M	188.79M	90.44M
	Total Assets
943.87M	982.95M	972.31M	1.04B	1.38B	1.37B
	Total Debt
102.92M	89.68M	88.22M	56.06M	153.46M	221.74M
	Net Debt
17.88M	-6.77M	44.23M	-84.99M	8.16M	181.35M
	Total Liabilities
524.83M	558.07M	620.71M	645.74M	701.83M	801.65M
	Stockholders Equity
417.04M	431.25M	358.11M	400.99M	684.75M	571.44M
Cash Flow		Free Cash Flow
-25.40M	15.66M	-126.08M	-57.13M	116.29M	-56.16M
	Operating Cash Flow
-25.31M	16.52M	-124.95M	-52.00M	118.96M	-45.91M
	Investing Cash Flow
3.64M	-57.71M	2.82M	-1.99M	-12.05M	-9.96M
	Financing Cash Flow
13.79M	93.65M	24.68M	48.15M	-948.79K	71.83M

Huazhang Technology Holding Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.23
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1673, the sentiment is Neutral. The current price of 0.23 is below the 20-day moving average (MA) of 0.23, above the 50-day MA of 0.22, and below the 200-day MA of 0.26, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 78.94 is Negative, neither overbought nor oversold. The STOCH value of 100.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:1673.

Huazhang Technology Holding Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	66 Neutral	$4.51B	12.29	5.40%	3.67%	4.15%	-12.21%
1673	44 Neutral	HK$363.92M	―	-1.94%	―	-14.00%	87.71%
LNNGF		$5.23B	12.31	11.92%	5.28%	―	―
ANPDF		$34.81B	15.39	28.11%	2.55%	―	―
CCOHF		$8.14B	6.30	14.62%	5.64%	―	―
ZHUZF		$6.36B	11.65	9.62%	2.53%	―	―
3878	57 Neutral	HK$84.41M	11.71	2.81%	―	-46.10%	-38.04%

Huazhang Technology Holding Ltd. Corporate Events

Huazhang Technology Reports Improved Interim Financial Results

Huazhang Technology Holding Limited reported its interim results for the six months ending December 31, 2024, showing a significant improvement in financial performance. The company achieved a 17.2% increase in revenue to RMB 195.6 million and a 45.9% rise in gross profit to RMB 40.6 million, resulting in a gross profit margin of 20.8%. Despite a net loss of RMB 6.8 million, this marks a substantial reduction from the previous year’s loss of RMB 18.7 million, reflecting a 63.5% improvement. The board decided not to declare an interim dividend for this period.