Town Health International Medical Group Ltd. (3886) AI Stock Analysis

• Market Cap: HK$1.86B
• Dividend Yield: 0.47%
• Average Volume (3M): 1.53M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.03
• Revenue Growth: -0.55%
• EPS Growth: 45.36%
• Country: HK
• Employees: 1,138
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Care Facilities
• EPS (TTM): <0.01
• Shares Outstanding: 6,773,522,500
• 10 Day Avg. Volume: 1,718,950
• 30 Day Avg. Volume: 1,531,500
• PEG Ratio: -1.67
• Price to Book (P/B): 0.56
• Price to Sales (P/S): 0.90
• P/FCF Ratio: 8.05
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 52 Neutral
• Price Target: HK$0.50 ▲(92.31% Upside)

The stock score is primarily impacted by financial performance challenges, particularly in profitability and cash flow management. Technical indicators suggest bearish momentum, and valuation is affected by a negative P/E ratio despite a high dividend yield.

Positive Factors

Strong Equity Base

A strong equity base provides financial stability and reduces the risk of insolvency, supporting long-term growth and investment capacity.

Ample Cash Reserves

Ample cash reserves ensure liquidity and the ability to invest in growth opportunities or weather economic downturns, supporting sustainable operations.

Revenue Diversification

Diversified revenue streams reduce dependency on a single source, enhancing resilience against sector-specific downturns and supporting stable growth.

Negative Factors

Profitability Challenges

Negative net income indicates ongoing profitability issues, which can hinder reinvestment in the business and affect long-term viability.

Inconsistent Cash Flow

Inconsistent cash flow can lead to liquidity issues, limiting the company's ability to fund operations and invest in growth, affecting stability.

Rising Leverage

Rising leverage increases financial risk, potentially leading to higher interest costs and reduced financial flexibility, impacting long-term sustainability.

Town Health International Medical Group Ltd. Business Overview & Revenue Model

Company Description

Town Health International Medical Group Ltd. (3886) is a leading provider of comprehensive healthcare services based in Hong Kong. The company operates in multiple sectors including outpatient services, hospital management, and telemedicine, offering a range of core products and services that cater to the evolving healthcare needs of its clients. Town Health focuses on delivering high-quality medical care, preventive health services, and wellness programs, leveraging technology to enhance patient access and outcomes.

How the Company Makes Money

Town Health International Medical Group Ltd. generates revenue through several key streams. The primary source of income comes from outpatient services, where the company charges patients for consultations, diagnostic tests, and treatment plans. Additionally, Town Health earns revenue from its partnerships with hospitals and clinics, providing management services and sharing in the profits generated from patient care. Telemedicine services also contribute to revenue by enabling consultations and follow-ups via digital platforms, appealing to a broader patient base. Moreover, the company may receive income from health insurance reimbursements, as well as from corporate health programs and wellness initiatives offered to businesses. Strategic alliances with healthcare providers and insurers further enhance its market reach and profitability.

Town Health International Medical Group Ltd. Financial Statement Overview

Summary

The company shows moderate revenue growth but faces profitability challenges with negative net income. The balance sheet is strong with high equity and liquidity, though cash flow management is concerning due to inconsistent free cash flow.

Income Statement

The revenue has shown moderate growth from 2020 to 2024, with a notable dip in gross profit margin from 2023 to 2024. The company has experienced negative net income in the recent years, indicating profitability challenges. EBIT and EBITDA margins are also under pressure, suggesting operational inefficiencies.

Balance Sheet

The company maintains a strong equity base with a favorable equity ratio. However, the debt-to-equity ratio has increased slightly over the years, signaling rising leverage. Despite this, the company has ample cash reserves, enhancing financial stability.

Cash Flow

There is a lack of consistent positive free cash flow growth with significant fluctuations over the years. The operating cash flow has been insufficient to cover net income, indicating potential liquidity issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.82B	1.83B	1.83B	1.54B	1.48B	1.07B
Gross Profit	468.01M	487.39M	501.95M	414.45M	471.26M	284.58M
EBITDA	140.81M	160.68M	53.50M	237.57M	219.79M	-97.78M
Net Income	-143.30M	-203.70M	-194.21M	15.29M	22.01M	-281.04M
Balance Sheet
Total Assets	4.10B	4.13B	4.50B	4.75B	4.73B	4.58B
Cash, Cash Equivalents and Short-Term Investments	1.38B	1.40B	1.20B	1.35B	1.89B	1.82B
Total Debt	262.47M	357.62M	456.94M	475.02M	117.97M	139.88M
Total Liabilities	666.65M	746.56M	881.82M	896.09M	504.94M	456.51M
Stockholders Equity	3.01B	2.98B	3.24B	3.49B	3.86B	3.81B
Cash Flow
Free Cash Flow	172.04M	206.11M	229.79M	-5.46M	151.00M	3.75M
Operating Cash Flow	213.08M	244.83M	247.53M	31.73M	170.95M	39.05M
Investing Cash Flow	291.15M	164.29M	-20.95M	587.77M	-261.67M	-742.86M
Financing Cash Flow	-182.29M	-235.72M	-151.07M	-518.45M	-90.80M	-93.68M

Town Health International Medical Group Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.26
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:3886, the sentiment is Neutral. The current price of 0.26 is above the 20-day moving average (MA) of 0.26, below the 50-day MA of 0.27, and above the 200-day MA of 0.26, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 43.75 is Neutral, neither overbought nor oversold. The STOCH value of 75.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:3886.

Town Health International Medical Group Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3689	71 Outperform	HK$601.91M	7.29	5.33%	7.73%	0.47%	50.46%
1526	66 Neutral	HK$1.54B	5.31	20.47%	4.64%	-3.56%	-17.45%
3869	56 Neutral	HK$827.78M	5.69	30.40%	―	2.30%	―
3886	52 Neutral	HK$1.86B	-12.97	-4.66%	0.47%	-0.55%	45.36%
6639	52 Neutral	HK$1.10B	42.30	1.27%	―	-4.30%	13.83%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
9960	45 Neutral	HK$1.30B	―	-3.59%	1.95%	-4.09%	-1242.31%

Town Health International Medical Group Ltd. Corporate Events

Town Health Updates on Profit Guarantee Proceedings

Town Health International Medical Group Ltd. has updated its shareholders on the ongoing proceedings related to a profit guarantee concerning its acquisition of Central Medical Holdings Limited. The company identified HK$5,000,000 in transactions that should be excluded from the Target Group’s operational profit for the financial year ended 31 March 2023. Consequently, Town Health is claiming an additional HK$75,000,000 due to the non-satisfaction of the performance target, raising the total claim amount to HK$172,956,690. The proceedings are still ongoing, and the company will provide further updates as necessary.