Chervon Holdings Limited (2285) AI Stock Analysis

• Market Cap: HK$12.34B
• Dividend Yield: 8.66%
• Average Volume (3M): 1.81M
• Price to Earnings (P/E): 10.8
• Beta (1Y): 0.96
• Revenue Growth: 28.34%
• EPS Growth: N/A
• Country: HK
• Employees: 6,481
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 1.48
• Shares Outstanding: 511,053,800
• 10 Day Avg. Volume: 1,023,914
• 30 Day Avg. Volume: 1,813,067
• PEG Ratio: -0.03
• Price to Book (P/B): 1.11
• Price to Sales (P/S): 0.65
• P/FCF Ratio: 12.19
• 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: HK$29.35
• Price Target Upside: 50.20% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 77 Outperform
• Price Target: HK$28.00 ▲(43.30% Upside)

The score is driven primarily by improving financial performance (revenue growth and a return to positive profitability) and an attractive valuation (low P/E and high dividend yield). Technicals are supportive of an uptrend but are capped by overbought momentum signals that raise near-term risk.

Positive Factors

Multi-year Revenue Growth

Sustained revenue expansion more than doubles scale since 2019, evidencing durable demand for Chervon’s power tools and outdoor equipment. Larger scale supports distribution leverage, R&D investment and bargaining power with retailers, strengthening competitive position over the next 2–6 months.

Material Deleverage

A sharp reduction in leverage materially boosts financial flexibility: lower interest burden, greater capacity for capex, dividends or M&A. Improved capital structure reduces refinancing risk and supports strategic investments that can sustain growth and margins over coming quarters.

Free Cash Flow Recovery

Return to positive free cash flow signals stronger cash conversion from operations, enabling reinvestment, shareholder returns and balance sheet repair. Improved cash generation enhances resilience to cyclical pressures and underpins durable operational investments over 2–6 months.

Negative Factors

Earnings Volatility

Historical swings in EBIT and net income indicate earnings are sensitive to cost, mix and cycle effects. That variability complicates forecasting, capital allocation and margin improvement plans, and could constrain sustained margin progress unless operational consistency is entrenched.

Residual Leverage Risk

Although leverage fell substantially, remaining debt exposure could pressure liquidity under adverse demand or higher rates. Residual debt limits extreme strategic flexibility and raises downside risk in a downturn, making sustained deleveraging and cash buildup important.

Recent Profitability Turnaround

Margins only recently recovered after a difficult year, signaling operational improvement is nascent. If cost pressures, supply disruptions or competitive pricing re-emerge, profits could re-widen negative, so sustaining structural margin improvements remains an execution risk.

Chervon Holdings Limited Business Overview & Revenue Model

Company Description

Chervon Holdings Limited engages in the research, development, manufacture, testing, sale, and after-sale servicing of power tools, outdoor power equipment, and related products North America, Europe, the People's Republic of China, and internationally. The company offers power tools and its accessories for consumer, professionals, and industrial users, as well as original design manufacturer customer; and outdoor tools and its accessories for professional and mass-market users. It provides its products under the EGO, FLEX, SKIL, DEVON, and X-TRON brand names. The company also involved in trading and financial management; sale of parts and components to home appliances business; design, operation, and sale of do-it-yourself products; and production and sale of gardening tools. The company was founded in 1922 and is headquartered in Nanjing, the People's Republic of China.

How the Company Makes Money

Chervon Holdings Limited generates revenue primarily through the sale of its power tools and outdoor equipment, which are distributed through various channels including retail, online platforms, and direct sales to professional contractors. Key revenue streams include sales of branded products under its own labels as well as partnerships with other brands. The company has established significant partnerships with major retailers and distributors, which enhances its market reach and drives sales growth. Additionally, Chervon invests in research and development to innovate new products and improve existing ones, thereby attracting a broader customer base and increasing overall sales.

Chervon Holdings Limited Financial Statement Overview

Summary

Strong multi-year revenue growth and a 2024 recovery in profitability (EBIT/EBITDA and net margin back to positive) support a solid score. This is tempered by prior volatility in EBIT/net income and historically uneven cash flow consistency.

Income Statement

Chervon Holdings Limited has demonstrated strong revenue growth, increasing from $840 million in 2019 to $1.77 billion in 2024, indicating a robust growth trajectory. The company has improved its EBIT and EBITDA margins into positive territory after a challenging period in 2023. The net profit margin has also shown recovery, turning from negative to positive in 2024. However, the volatility in EBIT and net income in previous years suggests some operational challenges that need to be continuously managed.

Balance Sheet

The company maintains a stable financial position with a debt-to-equity ratio improving from 2.05 in 2019 to 0.30 in 2024, indicating a significant reduction in leverage. The equity ratio has also improved, reflecting better asset management and reduced liability dependence. However, the debt levels, while reduced, still pose a potential risk if market conditions worsen.

Cash Flow

Chervon Holdings has shown a significant improvement in free cash flow, turning positive in 2024 after a negative period. The operating cash flow to net income ratio indicates strong cash generation relative to net income. However, historical volatility in cash flows, including a period of negative free cash flow, suggests potential risk in cash management and operational efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.87B	1.77B	1.37B	1.99B	1.76B	1.20B
Gross Profit	650.94M	615.68M	386.70M	604.17M	494.32M	368.57M
EBITDA	259.27M	199.71M	-2.57M	244.45M	184.43M	99.97M
Net Income	146.17M	112.47M	-37.12M	139.44M	144.49M	44.34M
Balance Sheet
Total Assets	1.82B	1.99B	1.80B	1.86B	2.06B	1.09B
Cash, Cash Equivalents and Short-Term Investments	495.09M	328.76M	296.34M	486.73M	703.02M	172.31M
Total Debt	331.65M	309.48M	336.02M	351.54M	456.88M	355.18M
Total Liabilities	817.97M	955.60M	835.76M	916.40M	1.26B	807.44M
Stockholders Equity	1.01B	1.04B	960.73M	946.19M	797.02M	259.74M
Cash Flow
Free Cash Flow	97.10M	93.95M	-261.95M	-49.15M	77.02M	102.13M
Operating Cash Flow	176.87M	167.68M	-173.64M	23.08M	158.14M	133.68M
Investing Cash Flow	-38.49M	-70.42M	-57.94M	-116.50M	-58.87M	-15.65M
Financing Cash Flow	-115.69M	-60.81M	61.08M	-104.12M	399.39M	-50.41M

Chervon Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 19.54
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2285, the sentiment is Positive. The current price of 19.54 is below the 20-day moving average (MA) of 23.45, below the 50-day MA of 21.39, and above the 200-day MA of 18.69, indicating a bullish trend. The MACD of 0.96 indicates Positive momentum. The RSI at 58.20 is Neutral, neither overbought nor oversold. The STOCH value of 14.35 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2285.

Chervon Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2285	77 Outperform	HK$12.34B	10.82	14.64%	8.66%	28.34%	―
1286	75 Outperform	HK$12.10B	17.63	14.15%	3.23%	2.87%	17.03%
1133	74 Outperform	€44.35B	18.55	15.06%	1.44%	34.78%	98.79%
2722	73 Outperform	HK$9.03B	14.52	7.29%	2.50%	11.18%	46.57%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
0658	45 Neutral	HK$2.98B	-0.45	-69.18%	―	-4.88%	-860.80%
0187	42 Neutral	HK$6.52B	-508.75	-0.43%	―	7.11%	77.53%

Chervon Holdings Limited Corporate Events

Chervon Holdings Announces Director Resignation and Temporary Non-Compliance

Chervon Holdings Limited announced the resignation of Mr. Tian Ming as an independent non-executive director, effective November 28, 2025, due to his desire to focus on personal endeavors. This resignation results in temporary non-compliance with Hong Kong Stock Exchange listing rules regarding board and committee composition. The company is actively seeking a suitable candidate to fill the vacancy and aims to restore compliance within three months.

The most recent analyst rating on (HK:2285) stock is a Buy with a HK$24.50 price target. To see the full list of analyst forecasts on Chervon Holdings Limited stock, see the HK:2285 Stock Forecast page.

Chervon Holdings Limited Updates Board of Directors and Committees

Chervon Holdings Limited has announced its updated list of directors and their roles within the company. The board consists of both executive and independent non-executive directors, with specific individuals assigned to the audit, remuneration, and nomination committees. This announcement reflects the company’s structured governance approach, potentially impacting its strategic decision-making and stakeholder engagement.

The most recent analyst rating on (HK:2285) stock is a Buy with a HK$24.50 price target. To see the full list of analyst forecasts on Chervon Holdings Limited stock, see the HK:2285 Stock Forecast page.