Values Cultural Investment Limited (1740) AI Stock Analysis

• Market Cap: HK$91.30M
• Dividend Yield: N/A
• Average Volume (3M): 58.50K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.77
• Revenue Growth: -77.93%
• EPS Growth: 11.26%
• Country: HK
• Employees: 22
• Sector: Communication Services
• Sector Strength: 97
• Industry: Entertainment
• EPS (TTM): >-0.01
• Shares Outstanding: 1,037,500,000
• 10 Day Avg. Volume: 70,500
• 30 Day Avg. Volume: 58,500
• PEG Ratio: 0.74
• Price to Book (P/B): 0.97
• Price to Sales (P/S): 18.43
• P/FCF Ratio: -4.19
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 47 Neutral
• Price Target: HK$0.09 ▼(-5.56% Downside)

The overall stock score is primarily impacted by the company's weak financial performance, characterized by declining revenues and persistent losses. Technical analysis shows some positive short-term trends, but potential bearish signals and overbought conditions pose risks. Valuation metrics are poor due to negative earnings and lack of dividends, further weighing down the score.

Positive Factors

Low Leverage

Low leverage provides financial flexibility, reducing risk during economic downturns and allowing the company to potentially invest in growth opportunities without the burden of high interest obligations.

Strategic Partnerships

Strategic partnerships enhance revenue potential and strengthen market position by leveraging collaborative projects, which can lead to sustainable growth and increased influence in the cultural sector.

Equity Base Strength

A strong equity base provides stability and a buffer against financial volatility, supporting long-term operational resilience and the ability to withstand economic challenges.

Negative Factors

Revenue Decline

Declining revenues indicate challenges in maintaining market share and competitiveness, which can undermine long-term growth prospects and investor confidence if not addressed.

Negative Cash Flow

Negative cash flow from operations suggests difficulties in sustaining business activities and funding future investments, potentially leading to liquidity issues and financial instability.

Operational Inefficiencies

Operational inefficiencies, as indicated by negative margins, can erode profitability and hinder the company's ability to compete effectively, necessitating strategic improvements for long-term viability.

Values Cultural Investment Limited Business Overview & Revenue Model

Company Description

Values Cultural Investment Limited, an investment holding company, engages in the production, distribution, and licensing of broadcasting rights of television (TV) and web series in Mainland China. The company invests in TV series, web series, and films as a non-executive producer; and acts as TV series distribution agent. It serves TV stations companies, which are engaged in the business of distribution of TV series, executive producers, and copyright owners of the TV series. Values Cultural Investment Limited was founded in 2013 and is headquartered in Tsuen Wan, Hong Kong.

How the Company Makes Money

Values Cultural Investment Limited generates revenue primarily through a combination of investment returns from its portfolio of cultural projects and enterprises. The company earns money by taking equity stakes in startups and established businesses within the creative sector, which can provide capital gains as these companies grow and succeed. Additionally, the company may receive income from sponsorships, grants, and donations tied to specific cultural initiatives it supports. Partnerships with local governments, nonprofits, and other cultural institutions also create opportunities for revenue through collaborative projects, further enhancing its financial sustainability.

Values Cultural Investment Limited Financial Statement Overview

Summary

Values Cultural Investment Limited is facing significant financial challenges, with declining revenues and persistent losses impacting profitability. The balance sheet shows low leverage, but negative cash flows and equity erosion are concerning. The company needs to address operational inefficiencies and explore strategies to stabilize and grow its revenue base.

Income Statement

The company has experienced significant revenue decline over the years, with a drastic drop from 2019 to 2024. Gross profit margins are negative, indicating that the cost of goods sold exceeds revenue. Net profit margins are also negative, reflecting ongoing losses. The EBIT and EBITDA margins are negative, highlighting operational inefficiencies and a lack of profitability.

Balance Sheet

The company's debt-to-equity ratio is low, suggesting minimal leverage, which is a positive aspect. However, the return on equity is negative due to consistent net losses. The equity ratio is relatively strong, indicating a solid equity base compared to total assets, but the declining asset base is a concern.

Cash Flow

Operating cash flow has been negative in recent years, indicating challenges in generating cash from operations. Free cash flow is also negative, reflecting insufficient cash generation to cover capital expenditures. The operating cash flow to net income ratio is unfavorable due to negative net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.21M	4.12M	62.91M	4.09M	43.14M	87.59M
Gross Profit	-36.00M	-38.90M	-61.10M	-38.41M	-252.00K	33.31M
EBITDA	-78.56M	-85.80M	-97.85M	-127.60M	-42.22M	3.78M
Net Income	-89.75M	-98.32M	-99.44M	-141.49M	-37.97M	1.23M
Balance Sheet
Total Assets	101.62M	100.03M	204.60M	302.04M	437.00M	489.34M
Cash, Cash Equivalents and Short-Term Investments	13.50M	20.70M	42.96M	39.05M	147.81M	147.63M
Total Debt	386.00K	766.00K	2.48M	883.00K	0.00	0.00
Total Liabilities	29.89M	21.76M	28.17M	26.46M	22.52M	35.51M
Stockholders Equity	71.73M	78.27M	176.43M	275.58M	414.48M	453.83M
Cash Flow
Free Cash Flow	-6.40M	-18.15M	4.23M	-73.63M	-24.60M	40.30M
Operating Cash Flow	-6.40M	-18.15M	4.33M	-73.48M	-24.55M	40.33M
Investing Cash Flow	-500.00K	-500.00K	-101.00K	-7.14M	546.00K	-3.33M
Financing Cash Flow	-391.00K	-3.47M	-900.00K	-900.00K	0.00	93.54M

Values Cultural Investment Limited Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.09
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1740, the sentiment is Neutral. The current price of 0.09 is above the 20-day moving average (MA) of 0.09, below the 50-day MA of 0.09, and above the 200-day MA of 0.08, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 40.56 is Neutral, neither overbought nor oversold. The STOCH value of 48.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:1740.

Values Cultural Investment 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$353.59M	-5.60	-23.06%	―	29.39%	-107.44%
1740	47 Neutral	HK$91.30M	-0.94	-77.19%	―	-77.93%	11.26%
1132	45 Neutral	HK$181.98M	-6.19	24.24%	―	-7.90%	93.34%
8172	42 Neutral	HK$79.97M	-3.64	-27.50%	―	-86.40%	53.43%
9958	39 Underperform	HK$68.04M	-1.21	―	―	-87.05%	72.21%
1326	39 Underperform	HK$70.08M	-0.21	―	―	60.31%	-73.59%