Champion Real Estate Investment (2778) AI Stock Analysis

• Market Cap: $12.95B
• Dividend Yield: 5.74%
• Average Volume (3M): 2.27M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.65
• Revenue Growth: -6.99%
• EPS Growth: -176.18%
• Country: HK
• Employees: N/A
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Retail
• EPS (TTM): -0.27
• Shares Outstanding: 6,135,291,500
• 10 Day Avg. Volume: 1,483,738
• 30 Day Avg. Volume: 2,272,495
• PEG Ratio: -0.03
• Price to Book (P/B): 0.24
• Price to Sales (P/S): 4.26
• P/FCF Ratio: 12.02
• Enterprise Value/Market Cap: 2.04
• Enterprise Value/Revenue: 11.03
• Enterprise Value/Gross Profit: 17.15
• Enterprise Value/Ebitda: 34.24
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 55 Neutral
• Price Target: HK$2.50 ▲(9.65% Upside)

The overall stock score of 55 reflects significant financial challenges, particularly in profitability and revenue growth, which weigh heavily on the company's outlook. While technical indicators are currently positive, suggesting short-term momentum, the valuation concerns due to negative earnings and high dividend yield create a mixed long-term investment perspective.

Positive Factors

Diverse Portfolio

A diverse property portfolio across multiple sectors helps mitigate risks associated with market fluctuations, providing stability and growth opportunities.

Strategic Partnerships

Partnerships provide access to capital and facilitate new projects, which can drive long-term growth and competitive advantage in the real estate market.

Stable Cash Flow

Positive operating cash flow indicates the company's ability to generate cash from its core operations, supporting ongoing investments and financial stability.

Negative Factors

Declining Revenue

Declining revenue impacts the company's ability to sustain growth and profitability, potentially affecting its market position and investor confidence.

Negative Profit Margin

A negative profit margin indicates operational inefficiencies and challenges in cost management, which can hinder long-term financial health and competitiveness.

Debt Concerns

A high debt-to-equity ratio can limit financial flexibility and increase vulnerability to economic downturns, impacting future growth and stability.

Champion Real Estate Investment Business Overview & Revenue Model

Company Description

Champion Real Estate Investment Trust is a trust formed to own and invest in income- producing office and retail properties. The Trust focuses on Grade-A commercial properties in prime locations. It currently offers investors direct exposure to 2.93 million sq. ft. of prime office and retail properties by way of two landmark properties, Three Garden Road and Langham Place, one on each side of the Victoria Harbour.

How the Company Makes Money

Champion Real Estate Investment generates revenue primarily through rental income from its portfolio of residential and commercial properties. The company invests in real estate developments, which can include new construction or the renovation of existing properties, allowing it to increase property values and attract higher-paying tenants. Additionally, the company may engage in property sales, realizing profits from appreciated asset values. Key revenue streams include long-term leases, short-term rentals, and property management services. Strategic partnerships with local developers and financial institutions further enhance its investment capabilities, providing access to capital and facilitating new project opportunities that contribute to its overall earnings.

Champion Real Estate Investment Financial Statement Overview

Summary

Champion Real Estate Investment faces significant challenges, particularly in its income statement, with declining revenues and profitability. The balance sheet remains relatively stable but signals potential risks with its debt position. Cash flow generation is steady but not growing, raising concerns about future financial flexibility. Overall, the company must address its profitability and growth trajectory to improve its financial health.

Income Statement

The income statement shows a concerning trend with declining revenue and profitability. The net profit margin has shifted from positive in 2023 to negative in 2024, driven by substantial net losses. This indicates challenges in maintaining operational efficiency. Additionally, the revenue growth rate has been negative over the past few years, reflecting declining sales performance.

Balance Sheet

The balance sheet reflects moderate stability with a strong equity position, but the debt-to-equity ratio remains a concern at approximately 0.33. The equity ratio is healthy, indicating a stable asset base. However, the decline in stockholders' equity over the years suggests potential erosion in asset value or increasing liabilities.

Cash Flow

The cash flow statement indicates a mixed performance. While operating cash flow remains positive, the free cash flow growth has been inconsistent. The operating cash flow to net income ratio is high due to negative net income, indicating cash generation issues relative to profits. Free cash flow remains stable, but growth is uncertain amidst declining net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.39B	2.46B	2.51B	2.65B	2.85B	2.97B
Gross Profit	1.54B	1.82B	1.67B	1.79B	1.99B	2.09B
EBITDA	770.01M	-1.26B	1.74B	1.76B	1.91B	2.09B
Net Income	-2.63B	-2.09B	220.62M	-749.32M	-831.36M	-12.50B
Balance Sheet
Total Assets	59.40B	61.35B	64.47B	65.23B	67.87B	71.69B
Cash, Cash Equivalents and Short-Term Investments	739.18M	726.22M	980.58M	734.93M	1.63B	1.83B
Total Debt	14.39B	14.37B	14.51B	14.52B	15.29B	16.40B
Total Liabilities	17.92B	17.80B	18.05B	18.00B	18.91B	20.84B
Stockholders Equity	41.48B	43.55B	46.42B	47.23B	48.96B	50.86B
Cash Flow
Free Cash Flow	702.59M	872.40M	1.17B	1.29B	1.60B	1.12B
Operating Cash Flow	702.59M	872.40M	1.17B	1.29B	1.60B	1.12B
Investing Cash Flow	16.59M	65.02M	195.30M	-208.17M	1.12B	-1.10B
Financing Cash Flow	-805.53M	-1.11B	-1.13B	-2.05B	-2.63B	-91.10M

Champion Real Estate Investment Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.28
• 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:2778, the sentiment is Positive. The current price of 2.28 is above the 20-day moving average (MA) of 2.26, above the 50-day MA of 2.16, and above the 200-day MA of 2.01, indicating a bullish trend. The MACD of 0.04 indicates Positive momentum. The RSI at 56.81 is Neutral, neither overbought nor oversold. The STOCH value of 63.16 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2778.

Champion Real Estate Investment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
0778	61 Neutral	HK$10.26B	―	-4.25%	7.23%	-4.20%	-138.86%
0435	58 Neutral	$4.02B	-43.48	―	7.93%	―	―
0808	57 Neutral	$2.20B	-16.33	-2.04%	7.90%	-7.79%	-73.32%
2778	55 Neutral	$12.95B	-4.89	-6.12%	5.74%	-6.99%	-176.18%
0823	55 Neutral	$106.90B	-11.91	-4.11%	7.53%	-1.84%	-194.03%
0405	55 Neutral	$4.69B	-6.90	-4.08%	7.07%	-6.57%	-390.60%

Champion Real Estate Investment Corporate Events

Champion REIT Reports Decline in 2025 Interim Results

Champion Real Estate Investment Trust is a Hong Kong-based trust that invests in income-producing office and retail properties, focusing on Grade-A commercial properties in prime locations. In the first half of 2025, Champion REIT reported a decline in financial performance, with total rental income decreasing by 7.6% to HK$1,029 million and net property income falling by 10% to HK$859 million. The Trust’s distributable income also dropped by 12.6% to HK$476 million, and the distribution per unit decreased by 13.3% to HK$0.0701. The Trust’s gross value of the property portfolio decreased by 3.3% to HK$58.1 billion, reflecting lower rental rate assumptions. Despite these challenges, the Trust successfully refinanced HK$1.2 billion in bank loans and medium-term notes, maintaining a healthy gearing ratio of 24.5%. Looking forward, Champion REIT anticipates continued challenges due to global economic uncertainties and a soft rental market. However, management remains committed to flexible leasing strategies and strengthening property positioning to navigate the competitive landscape.