Precious Dragon Technology Holdings Ltd. (1861) AI Stock Analysis

• Market Cap: HK$388.30M
• Dividend Yield: 3.1%
• Average Volume (3M): 15.53K
• Price to Earnings (P/E): 6.2
• Beta (1Y): 0.39
• Revenue Growth: 17.38%
• EPS Growth: 15.93%
• Country: HK
• Employees: 468
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 0.23
• Shares Outstanding: 233,917,250
• 10 Day Avg. Volume: 1,800
• 30 Day Avg. Volume: 15,533
• PEG Ratio: -0.20
• Price to Book (P/B): 0.79
• Price to Sales (P/S): 0.42
• P/FCF Ratio: 9.93
• 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: 79 Outperform
• Price Target: HK$2.00 ▲(14.29% Upside)

The stock's overall score is driven by its strong valuation and positive technical indicators. While the financial performance shows strengths in cost management and balance sheet stability, challenges in revenue growth and cash flow management need to be addressed. The absence of earnings call data and corporate events did not impact the score.

Positive Factors

Strong Cost Management

Effective cost management allows the company to maintain profitability and operational efficiency, providing a competitive edge in the technology sector.

Solid Balance Sheet

A strong equity base and low leverage reduce financial risk, enhancing the company's ability to invest in growth opportunities and withstand economic downturns.

Gross Profit Margin

A high gross profit margin indicates effective pricing strategies and cost controls, which are crucial for sustaining profitability in competitive markets.

Negative Factors

Declining Revenue Growth

Declining revenue growth can hinder the company's ability to expand and compete, potentially impacting its market position and long-term viability.

Net Profit Margin Decline

A declining net profit margin suggests challenges in maintaining profitability, which could affect the company's ability to reinvest in growth and innovation.

Cash Flow Management Issues

Inadequate cash flow management can limit the company's financial flexibility, affecting its ability to fund operations and invest in strategic initiatives.

Precious Dragon Technology Holdings Ltd. Business Overview & Revenue Model

Company Description

Precious Dragon Technology Holdings Ltd. (1861) is a Hong Kong-based investment holding company that primarily focuses on the technology sector, including telecommunications, information technology, and digital media. The company is engaged in the development and provision of innovative technology solutions and services, catering to a diverse range of clients across various industries. With a commitment to harnessing advanced technologies, Precious Dragon aims to enhance operational efficiencies and drive growth for its customers.

How the Company Makes Money

Precious Dragon Technology Holdings Ltd. generates revenue primarily through the provision of technology services, including software development, system integration, and consulting services. The company's revenue model is built on charging clients for project-based contracts, ongoing maintenance and support services, and licensing fees for proprietary technology products. Key revenue streams include service contracts with corporate clients, long-term partnerships with telecommunications providers, and potential revenue from technology licensing agreements. Additionally, the company may benefit from strategic collaborations with other tech firms and government contracts, which can provide stable income and opportunities for growth.

Precious Dragon Technology Holdings Ltd. Financial Statement Overview

Summary

The company demonstrates strong cost management and a solid balance sheet with a high equity ratio and low leverage. However, declining revenue, net profit margins, and cash flow issues are significant concerns that need addressing.

Income Statement

The company shows a strong gross profit margin of 37.07% in 2024, reflecting good cost management and pricing power. However, the net profit margin of 5.56% indicates room for improvement, as it has dropped from the previous year. EBIT and EBITDA margins demonstrate stable operational efficiency, but revenue growth is a concern, with a decline from 2023.

Balance Sheet

The balance sheet is solid with a strong equity base, as evidenced by an improving equity ratio of 68.39% in 2024. The debt-to-equity ratio of 0.13 suggests low leverage, minimizing financial risk. ROE decreased to 10.45%, indicating a need for more efficient capital use.

Cash Flow

Cash flow management is an area for improvement, with zero free cash flow reported in 2024. Previous years showed positive free cash flow, highlighting potential fluctuations. The operating cash flow to net income ratio is not available for 2024, making it difficult to assess cash conversion efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	663.47M	612.97M	557.22M	559.78M	610.35M	665.65M
Gross Profit	280.94M	227.25M	175.90M	154.19M	157.09M	223.52M
EBITDA	72.07M	60.92M	99.32M	83.33M	56.00M	117.36M
Net Income	62.80M	34.07M	56.92M	42.00M	18.09M	53.16M
Balance Sheet
Total Assets	531.89M	476.53M	484.76M	475.21M	522.81M	521.27M
Cash, Cash Equivalents and Short-Term Investments	155.87M	105.61M	114.15M	104.63M	110.13M	161.62M
Total Debt	38.72M	25.32M	35.54M	50.94M	120.37M	68.78M
Total Liabilities	150.78M	151.05M	176.84M	207.56M	276.48M	295.55M
Stockholders Equity	381.54M	325.91M	308.37M	267.88M	246.50M	225.82M
Cash Flow
Free Cash Flow	37.06M	25.91M	57.76M	47.41M	-20.06M	22.33M
Operating Cash Flow	51.18M	48.35M	76.45M	67.72M	59.99M	78.84M
Investing Cash Flow	21.18M	-20.00M	-17.16M	-19.38M	-79.93M	-56.65M
Financing Cash Flow	-30.66M	-32.04M	-39.27M	-43.63M	-56.65M	-1.55M

Precious Dragon Technology Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.75
• 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:1861, the sentiment is Positive. The current price of 1.75 is below the 20-day moving average (MA) of 1.76, above the 50-day MA of 1.72, and above the 200-day MA of 1.34, indicating a neutral trend. The MACD of 0.01 indicates Positive momentum. The RSI at 49.72 is Neutral, neither overbought nor oversold. The STOCH value of 45.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1861.

Precious Dragon Technology Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1861	79 Outperform	HK$388.30M	6.18	17.60%	3.10%	17.38%	15.93%
2420	67 Neutral	HK$1.63B	8.89	27.30%	3.69%	23.59%	―
2101	64 Neutral	HK$670.17M	45.05	1.04%	―	-36.58%	-84.25%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
0178	56 Neutral	HK$1.92B	25.00	8.44%	3.95%	-3.18%	-36.46%
1759	52 Neutral	HK$231.12M	-18.20	-3.11%	―	50.72%	-434.09%
8536	48 Neutral	HK$53.13M	-5.34	-13.87%	―	3.82%	68.82%

Precious Dragon Technology Holdings Ltd. Corporate Events

Precious Dragon Technology Reports Strong Interim Results for 2025

Precious Dragon Technology Holdings Ltd. announced its interim financial results for the six months ended June 30, 2025, reporting a significant increase in revenue and profit compared to the same period in 2024. The company’s revenue rose to HK$324,749,000 from HK$274,248,000, and profit before tax increased to HK$64,463,000 from HK$33,918,000, indicating strong operational performance and positive market positioning.

Precious Dragon Technology Announces Interim Dividend

Precious Dragon Technology Holdings Ltd. announced an interim cash dividend of HKD 0.0324 per share for the six months ending 30 June 2025. The ex-dividend date is set for 3 September 2025, with the payment date scheduled for 28 October 2025. This announcement reflects the company’s financial health and commitment to returning value to its shareholders, potentially strengthening its market position and investor confidence.

Precious Dragon Technology Projects Significant Profit Increase

Precious Dragon Technology Holdings Limited has announced a positive profit alert, indicating a significant increase in net profit by at least 90% for the first half of 2025 compared to the same period in 2024. This increase is primarily due to net gains from the disposal of property, plant, and equipment, as well as net foreign exchange gains. The interim results are expected to be finalized and announced by the end of August 2025.

Precious Dragon Technology Announces Upcoming Board Meeting

Precious Dragon Technology Holdings Ltd. has announced a board meeting scheduled for 21 August 2025 to review and approve the interim results for the first half of 2025 and to consider declaring an interim dividend. This meeting is significant as it will provide insights into the company’s financial performance and potential returns for shareholders, impacting its market positioning and stakeholder interests.