Champion Real Estate Investment (2778) AI Stock Analysis

• Market Cap: HK$15.52B
• Dividend Yield: 5.43%
• Average Volume (3M): 2.27M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.62
• 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: 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: 55 Neutral
• Price Target: HK$2.50 ▲(7.30% 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

Stable recurring rental income

Recurring rental income from residential and commercial assets provides a durable cash base that smooths revenue volatility versus sales-driven firms. Over months this supports predictable operating cash flow, underwriting for maintenance, debt service and steady distributions to investors.

Diversified residential and commercial portfolio

A mix of multifamily, retail and office exposures reduces concentration risk and lets management reallocate capital across sectors as demand shifts. Structurally, this diversification helps preserve rental income and occupancy through differing economic cycles over the coming months.

Positive operating cash flow

Consistent positive operating cash flow indicates the core property portfolio generates real cash despite accounting losses. Over a multi-month horizon this preserves liquidity to cover day-to-day operations, fund essential capex and service debt, supporting business continuity.

Negative Factors

Declining revenue and profitability trend

A sustained fall in revenue and shrinking margins undermines the company’s ability to cover fixed property and financing costs. Over several months this pressures reinvestment, maintenance budgets and dividend capacity, and signals the need for strategic action to restore occupancy or pricing.

Deteriorating EPS and net losses

Severe EPS decline and reported net losses erode retained earnings and reduce equity cushions. Persisting losses over months can constrain access to credit, limit funding for development or renovations, and raise the risk that capital raising may be required under less favorable terms.

Erosion in shareholders' equity and leverage concerns

A declining equity base alongside a non-trivial debt ratio weakens the balance sheet buffer. Over a medium horizon this reduces financial flexibility to pursue new projects or absorb shocks, increasing refinancing and covenants risk if operating performance does not stabilize.

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: 2.33
• 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:2778, the sentiment is Positive. The current price of 2.33 is below the 20-day moving average (MA) of 2.45, below the 50-day MA of 2.37, and above the 200-day MA of 2.14, indicating a bullish trend. The MACD of 0.06 indicates Negative momentum. The RSI at 59.44 is Neutral, neither overbought nor oversold. The STOCH value of 81.10 is Negative, 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$10.45B	-9.11	-4.25%	7.24%	-4.20%	-138.86%
0435	58 Neutral	HK$4.21B	-45.56	―	7.90%	―	―
0808	57 Neutral	HK$2.34B	-17.27	-2.04%	8.01%	-7.79%	-73.32%
2778	55 Neutral	HK$15.52B	-5.86	-6.12%	5.43%	-6.99%	-176.18%
0823	55 Neutral	HK$93.98B	-13.66	-4.11%	7.61%	-1.84%	-194.03%
0405	55 Neutral	HK$4.47B	-6.51	-4.08%	7.40%	-6.57%	-390.60%