Wharf Real Estate Investment Co (1997) AI Stock Analysis

• Market Cap: HK$71.78B
• Dividend Yield: 5.2%
• Average Volume (3M): 5.62M
• Price to Earnings (P/E): 84.2
• Beta (1Y): 0.94
• Revenue Growth: -3.87%
• EPS Growth: -124.27%
• Country: HK
• Employees: 2,900
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): 1.03
• Shares Outstanding: 3,036,227,300
• 10 Day Avg. Volume: 5,427,505
• 30 Day Avg. Volume: 5,622,821
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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$28.78
• Price Target Upside: 21.73% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 49 Neutral
• Price Target: HK$22.00 ▼(-6.94% Downside)

The overall stock score reflects significant financial and valuation challenges. While the company has strong margins and a stable balance sheet, the lack of cash flow generation and negative P/E ratio are major concerns. Technical indicators suggest neutral to bearish sentiment, further impacting the score.

Positive Factors

Negative Factors

Wharf Real Estate Investment Co Business Overview & Revenue Model

Company Description

Wharf Real Estate Investment Company Limited, an investment holding company, invests in, develops, owns, and operates properties and hotels in Hong Kong, Mainland China, and Singapore. The company operates through four segments: Investment Properties, Development Properties, Hotel, and Investment segments. It primarily operates Harbour City, a commercial space comprising offices, retail shops, serviced apartments, hotels and clubs, and car parking spaces; and Times Square, a retail space that consists of office and car parking spaces. The company also operates Wheelock House and Crawford House commercial properties; The Murray, a luxury hotel that consists of 336 rooms; Plaza Hollywood, a shopping mall with retail outlets, restaurants, and a stadium housing six-screen cinema multiplex; The Star Ferry, which provides two inner harbour ferry services, including Tsim Sha Tsui and Wan Chai; and Wheelock Place and Scotts Square mall. In addition, it offers leasing, finance, and management services; and engages in property investment. The company was founded in 1886 and is headquartered in Kowloon, Hong Kong.

How the Company Makes Money

Wharf Real Estate Investment Co generates revenue primarily through leasing and managing its extensive portfolio of commercial and residential properties. The company's key revenue streams include rental income from retail malls, office spaces, and residential units, which provide a steady cash flow. Additionally, the company capitalizes on property sales and development profits, particularly in prime urban areas where property values are high. Significant partnerships with retailers, corporate tenants, and property developers enhance its earnings potential, while strategic investments in urban redevelopment projects contribute to long-term growth and sustainability. Wharf also benefits from its strong brand reputation and market position in key Asian markets, allowing it to command premium rental rates and attract high-quality tenants.

Wharf Real Estate Investment Co Financial Statement Overview

Summary

The company's financial performance is mixed. Strong gross and EBIT margins are overshadowed by a low net profit margin and declining revenue. The balance sheet is stable with low leverage, but cash flow issues are significant, with no operating or free cash flow reported, raising liquidity concerns.

Income Statement

The company's income statement shows mixed results. Gross profit margin is strong at 80.1%, and EBIT margin is healthy at 75.1%. However, the net profit margin is low at 6.9%, reflecting reduced profitability. Revenue has declined by 3% from the previous year, indicating a downward trend in sales. While EBITDA margin is robust at 76.9%, the overall performance is impacted by declining revenue and low net profitability.

Balance Sheet

The company's balance sheet reflects stability with a debt-to-equity ratio of 0.20, indicating low leverage. The equity ratio is high at 78.9%, suggesting strong equity financing. However, return on equity is relatively low at 0.5%, showing limited returns for shareholders. The company's asset base has decreased, which may impact future growth potential.

Cash Flow

The cash flow statement indicates significant challenges, with no operating cash flow or free cash flow reported for the latest year, which raises concerns about cash generation capacity. Operating cash flow to net income ratio and free cash flow to net income ratio are not calculable, pointing to potential liquidity issues.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	12.91B	13.31B	12.41B	16.04B	15.52B
Gross Profit	10.34B	10.68B	9.65B	10.38B	10.84B
EBITDA	9.94B	10.24B	-6.15B	9.37B	-5.74B
Net Income	891.00M	4.77B	-8.86B	4.39B	-7.85B
Balance Sheet
Total Assets	238.07B	245.32B	255.25B	272.27B	277.91B
Cash, Cash Equivalents and Short-Term Investments	1.31B	1.12B	1.34B	1.80B	2.26B
Total Debt	35.54B	37.42B	46.49B	49.33B	54.28B
Total Liabilities	46.09B	49.72B	60.37B	61.39B	68.50B
Stockholders Equity	187.82B	191.41B	190.36B	206.11B	204.55B
Cash Flow
Free Cash Flow	6.30B	5.82B	6.65B	7.77B	4.65B
Operating Cash Flow	6.34B	5.87B	6.69B	7.97B	4.82B
Investing Cash Flow	-174.00M	7.17B	-2.16B	199.00M	-8.13B
Financing Cash Flow	-5.96B	-13.25B	-4.90B	-8.66B	2.59B

Wharf Real Estate Investment Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 23.64
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1997, the sentiment is Positive. The current price of 23.64 is above the 20-day moving average (MA) of 22.99, above the 50-day MA of 23.19, and above the 200-day MA of 20.08, indicating a bullish trend. The MACD of 0.24 indicates Negative momentum. The RSI at 54.83 is Neutral, neither overbought nor oversold. The STOCH value of 82.02 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1997.

Wharf Real Estate Investment Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0101	77 Outperform	45.42B	21.40	1.64%	5.73%	-9.76%	-28.29%
2602	74 Outperform	28.92B	22.80	7.00%	4.21%	5.75%	-31.63%
1209	69 Neutral	95.73B	23.94	21.96%	3.29%	10.31%	8.93%
6098	65 Neutral	23.34B	15.42	4.94%	4.36%	7.23%	0.00%
1997	49 Neutral	HK$71.78B	84.16	-0.25%	5.20%	-3.87%	-124.27%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%

Wharf Real Estate Investment Co Corporate Events

Wharf REIC Reports Stable Profits Amid Market Challenges

Wharf Real Estate Investment Co reported its interim results for the first half of 2025, highlighting a stable underlying net profit despite a challenging market environment marked by geopolitical tensions and economic uncertainties. The company experienced a decrease in borrowing costs and maintained a healthy gearing ratio, although it faced a revaluation deficit in investment properties. The retail sector showed signs of recovery with improved visitor numbers and enhanced experiential offerings, while the office sector remained under pressure due to oversupply. The company continued to focus on prudent financial management and strategic enhancements to its property portfolio.

The most recent analyst rating on (HK:1997) stock is a Sell with a HK$20.00 price target. To see the full list of analyst forecasts on Wharf Real Estate Investment Co stock, see the HK:1997 Stock Forecast page.

Wharf Real Estate Announces Interim Dividend for 2025

Wharf Real Estate Investment Company Limited announced an interim dividend of HKD 0.66 per share for the half-year period ending June 30, 2025. The dividend will be paid on September 11, 2025, with a record date of August 27, 2025. This announcement reflects the company’s ongoing commitment to providing returns to its shareholders and may influence investor sentiment positively.

The most recent analyst rating on (HK:1997) stock is a Sell with a HK$20.00 price target. To see the full list of analyst forecasts on Wharf Real Estate Investment Co stock, see the HK:1997 Stock Forecast page.

Wharf REIC Schedules Board Meeting to Discuss Interim Results and Dividend

Wharf Real Estate Investment Company Limited has announced a board meeting scheduled for August 7, 2025, to approve the interim results for the first half of the year and consider the payment of an interim dividend. This meeting is crucial for stakeholders as it will provide insights into the company’s financial performance and potential returns, impacting its market positioning and investor relations.

The most recent analyst rating on (HK:1997) stock is a Sell with a HK$20.00 price target. To see the full list of analyst forecasts on Wharf Real Estate Investment Co stock, see the HK:1997 Stock Forecast page.

Wharf Real Estate Investment Co Announces Board of Directors

Wharf Real Estate Investment Co has announced the composition of its Board of Directors, highlighting the roles and functions of each member. This announcement provides insights into the company’s governance structure, which is crucial for maintaining its strategic direction and operational efficiency. The board includes a mix of executive and independent non-executive directors, ensuring a balanced approach to decision-making and oversight.

The most recent analyst rating on (HK:1997) stock is a Buy with a HK$23.26 price target. To see the full list of analyst forecasts on Wharf Real Estate Investment Co stock, see the HK:1997 Stock Forecast page.

Wharf REIC Successfully Passes All Resolutions at AGM

Wharf Real Estate Investment Company Limited held its Annual General Meeting on May 15, 2025, where all proposed resolutions were passed. Key resolutions included the adoption of financial statements, re-election of directors, re-appointment of KPMG as auditors, and granting mandates for share buy-backs and issuance. The successful passing of these resolutions indicates strong shareholder support and positions the company for continued strategic operations in the real estate market.

The most recent analyst rating on (HK:1997) stock is a Buy with a HK$29.60 price target. To see the full list of analyst forecasts on Wharf Real Estate Investment Co stock, see the HK:1997 Stock Forecast page.