Freetech Road Recycling Technology (Holdings) Ltd. (6888) AI Stock Analysis

• Market Cap: HK$149.21M
• Dividend Yield: N/A
• Average Volume (3M): 155.30K
• Price to Earnings (P/E): 33.4
• Beta (1Y): 0.29
• Revenue Growth: -78.51%
• EPS Growth: 388.89%
• Country: HK
• Employees: 295
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Infrastructure Operations
• EPS (TTM): -0.01
• Shares Outstanding: 1,079,000,100
• 10 Day Avg. Volume: 232,800
• 30 Day Avg. Volume: 155,300
• PEG Ratio: -0.11
• Price to Book (P/B): 0.25
• Price to Sales (P/S): 0.95
• P/FCF Ratio: -11.46
• 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: 49 Neutral
• Price Target: HK$0.13 ▼(-10.67% Downside)

The company's financial performance is the most significant factor, with declining revenue and cash flow concerns outweighing the strong balance sheet. Technical indicators suggest bearish momentum, and the high P/E ratio indicates overvaluation. The absence of earnings call data and corporate events limits further insights.

Positive Factors

Profitability Margins

Improved profitability margins indicate effective cost management, which can enhance long-term financial health and shareholder value.

Financial Stability

A low debt-to-equity ratio suggests financial stability, providing the company with flexibility to invest in growth opportunities.

Sustainable Technology Focus

The emphasis on eco-friendly technology aligns with industry trends, potentially driving long-term demand and market leadership.

Negative Factors

Revenue Decline

A substantial drop in revenue raises concerns about market competitiveness and future growth prospects, impacting long-term viability.

Cash Flow Generation

Inability to generate cash flow from operations poses liquidity risks, potentially limiting the company's ability to fund operations and growth.

Asset Decline

A reduction in total assets may indicate underinvestment or asset management issues, affecting long-term operational capacity and growth.

Freetech Road Recycling Technology (Holdings) Ltd. Business Overview & Revenue Model

Company Description

Freetech Road Recycling Technology (Holdings) Limited, an investment holding company, manufactures and sells road maintenance equipment in the People's Republic of China. The company operates through Maintenance Services, Sale of Equipment, and Properties segments. It also provides road maintenance services. In addition, the company offers asphalt pavement maintenance (APM) equipment; and APM services to repair damaged asphalt pavement surfaces under the Road Doctor brand. Further, it is involved in sale and leasing of properties. Freetech Road Recycling Technology (Holdings) Limited was founded in 1993 and is headquartered in Wan Chai, Hong Kong.

How the Company Makes Money

Freetech generates revenue through the sale of its specialized road recycling machinery and equipment, which are marketed to construction companies, government agencies, and infrastructure developers. The company also earns money from providing maintenance services, spare parts, and technical support for its products. Additionally, Freetech may engage in strategic partnerships with local governments and construction firms to secure contracts for road construction and recycling projects, further contributing to its revenue. The focus on sustainable technology and increasing demand for eco-friendly construction solutions also play a pivotal role in enhancing the company's earnings.

Freetech Road Recycling Technology (Holdings) Ltd. Financial Statement Overview

Summary

The company faces challenges with declining revenue and zero cash flow generation, despite improved net profit margins and a strong balance sheet. The low debt-to-equity ratio indicates financial stability, but the lack of cash flow is a significant risk.

Income Statement

The company has shown a significant decline in revenue from 2023 to 2024. Despite the lower revenue, the net profit margin improved due to a significant reduction in expenses, leading to a higher net income in 2024 compared to 2023. However, the drop in revenue is concerning for future growth. Gross profit margins have also declined, indicating pressure on cost management.

Balance Sheet

The company maintains a strong equity position with a low debt-to-equity ratio, highlighting financial stability. However, the decline in total assets over the period needs attention. The equity ratio remains robust, indicating the company is not overly leveraged, which is positive for long-term sustainability.

Cash Flow

The company reported zero operating and free cash flow in 2024, which raises concerns about its ability to generate cash from operations. Historical data shows fluctuations in cash flow, indicating potential volatility in cash management. The lack of positive cash flow growth is a significant risk factor.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	114.87M	187.96M	543.10M	478.26M	511.62M	541.91M
Gross Profit	86.64M	89.97M	80.91M	97.92M	127.50M	118.14M
EBITDA	-2.95M	21.93M	57.25M	5.75M	89.77M	71.96M
Net Income	4.37M	12.56M	11.68M	-32.48M	31.95M	31.64M
Balance Sheet
Total Assets	960.07M	983.29M	1.24B	1.27B	1.34B	1.33B
Cash, Cash Equivalents and Short-Term Investments	241.56M	279.26M	246.69M	274.30M	277.57M	254.43M
Total Debt	130.79M	118.49M	101.72M	96.27M	97.50M	103.48M
Total Liabilities	245.51M	274.53M	472.93M	519.34M	476.46M	527.14M
Stockholders Equity	705.01M	699.17M	715.36M	722.29M	818.99M	775.60M
Cash Flow
Free Cash Flow	-63.47M	-15.52M	-34.97M	-1.96M	38.98M	42.46M
Operating Cash Flow	-41.29M	6.35M	-21.68M	2.44M	61.12M	58.12M
Investing Cash Flow	-31.94M	21.33M	20.89M	9.56M	-10.51M	18.20M
Financing Cash Flow	-5.47M	13.62M	1.17M	-3.66M	-21.87M	-26.14M

Freetech Road Recycling Technology (Holdings) Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.15
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:6888, the sentiment is Positive. The current price of 0.15 is above the 20-day moving average (MA) of 0.14, above the 50-day MA of 0.15, and below the 200-day MA of 0.16, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 58.11 is Neutral, neither overbought nor oversold. The STOCH value of 80.21 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:6888.

Freetech Road Recycling Technology (Holdings) Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1785	72 Outperform	HK$3.44B	6.46	10.26%	5.25%	3.78%	-17.34%
1576	64 Neutral	HK$3.64B	7.72	10.92%	6.05%	-21.80%	-8.00%
2258	64 Neutral	HK$180.18M	2.37	10.40%	4.64%	-13.98%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1823	54 Neutral	HK$466.25M	-9.88	-5.81%	―	-44.12%	-3110.53%
6888	49 Neutral	HK$149.21M	33.41	0.63%	―	-78.51%	388.89%
0269	40 Underperform	HK$106.44M	-0.34	―	―	5.76%	-138.78%

Freetech Road Recycling Technology (Holdings) Ltd. Corporate Events

Freetech Announces Delay in Circular Dispatch for Major CITIC Bank Subscriptions

Freetech Road Recycling Technology (Holdings) Ltd. announced a delay in the dispatch of a circular related to the Major CITIC Bank Subscriptions due to the need for additional time to prepare financial information. The Stock Exchange of Hong Kong has granted a waiver allowing the company to extend the dispatch deadline to 31 December 2025, with the condition that this waiver may be subject to change if the company’s situation changes.

Freetech Road Recycling Technology Engages in Structured Deposit Subscriptions

Freetech Road Recycling Technology (Holdings) Ltd. announced that its subsidiaries, Freetech Recycling and Nanjing Freetech, have subscribed to structured deposit products with various financial institutions, including Jiangsu Bank and CITIC Bank. The transactions, categorized as discloseable and major transactions under the Hong Kong Stock Exchange Listing Rules, have been approved by the company’s controlling shareholders, negating the need for an extraordinary general meeting. This move is part of the company’s financial strategy to optimize returns on its cash reserves, potentially impacting its financial performance and stakeholder interests.