MEGAIN Holding (Cayman) Co. Ltd. (6939) AI Stock Analysis

• Market Cap: HK$249.00M
• Dividend Yield: 4.1%
• Average Volume (3M): 113.73K
• Price to Earnings (P/E): 22.3
• Beta (1Y): 0.62
• Revenue Growth: 2.22%
• EPS Growth: -434.25%
• Country: HK
• Employees: 161
• Sector: Technology
• Sector Strength: 85
• Industry: Computer Hardware
• EPS (TTM): -0.08
• Shares Outstanding: 518,750,000
• 10 Day Avg. Volume: 119,400
• 30 Day Avg. Volume: 113,733
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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$0.50
• Price Target Upside: 8.70% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 52 Neutral
• Price Target: HK$0.50 ▲(8.70% Upside)

The overall stock score of 52 reflects significant financial performance concerns, particularly in revenue and cash flow generation. While the balance sheet is strong, liquidity risks and negative valuation metrics weigh heavily. Technical analysis provides mixed signals, with short-term bullish momentum but potential bearish trends. The high dividend yield offers some appeal, but the negative P/E ratio suggests underlying profitability issues.

MEGAIN Holding (Cayman) Co. Ltd. Business Overview & Revenue Model

Company Description

MEGAIN Holding (Cayman) Co., Ltd., an investment holding company, engages in the research, design, development, and sale of compatible cartridge chips and other chips in the People's Republic of China and internationally. It also trades in integrated circuits and other cartridge components, including plastic parts and toners, as ancillary services to its customers; and provides technical and design services for chips at the request of customers. The company was incorporated in 2016 and is headquartered in Zhuhai, the People's Republic of China.

How the Company Makes Money

MEGAIN Holding (Cayman) Co. Ltd. generates revenue primarily through the sale of its electronic components and products. The company has established a diversified revenue model that includes direct sales to manufacturers and distributors, as well as partnerships with key players in various industries. By focusing on innovation and quality, MEGAIN captures market share and maintains competitive pricing strategies, which contribute to its earnings. Additionally, strategic alliances and collaborations with other technology firms enhance its product offerings, allowing MEGAIN to tap into new markets and customer segments.

MEGAIN Holding (Cayman) Co. Ltd. Financial Statement Overview

Summary

MEGAIN Holding (Cayman) Co. Ltd. shows mixed financial health. The balance sheet is strong with high equity and low leverage, but the income statement reveals declining revenues and margins, indicating operational challenges. The absence of positive cash flow raises liquidity concerns, necessitating strategic adjustments to enhance cash generation and operational efficiency.

Income Statement

The company has experienced a decline in total revenue from the previous year, decreasing from $172.39 million to $149.65 million, indicating a negative revenue growth rate. The gross profit margin stands at approximately 32.24%, reflecting a reasonable level of cost management, but the net profit margin decreased to 6.46% due to a reduction in net income. Notably, EBIT and EBITDA margins have turned negative, highlighting operational challenges. These factors suggest moderate profitability with potential risks to revenue stability.

Balance Sheet

The company maintains a strong equity position with a high equity ratio of 90.39%, indicating financial stability and low reliance on debt financing. The debt-to-equity ratio is low at 0.03, suggesting prudent leverage. However, the return on equity has decreased slightly due to lower net income, which could impact overall shareholder returns. Overall, the balance sheet remains solid with a strong equity base and low leverage risk.

Cash Flow

The company reported zero operating, investing, and free cash flows for the latest period, which raises concerns about cash flow generation and liquidity. Previously, the free cash flow was negative, indicating cash flow challenges. The absence of cash flow metrics in the current year suggests potential liquidity constraints and a need for careful cash management to support operations and growth.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	149.65M	172.39M	173.37M	167.87M	156.78M
Gross Profit	48.25M	66.98M	90.63M	86.70M	87.07M
EBITDA	-3.95M	33.47M	60.44M	44.88M	40.69M
Net Income	9.66M	23.21M	44.89M	31.26M	28.75M
Balance Sheet
Total Assets	410.19M	390.21M	404.27M	360.16M	197.24M
Cash, Cash Equivalents and Short-Term Investments	229.19M	243.83M	277.13M	238.35M	123.47M
Total Debt	10.62M	1.88M	3.97M	9.08M	1.59M
Total Liabilities	39.40M	19.99M	40.48M	32.98M	23.37M
Stockholders Equity	370.79M	370.22M	363.79M	327.18M	173.87M
Cash Flow
Free Cash Flow	-8.54M	-19.36M	49.02M	-12.73M	70.04M
Operating Cash Flow	10.64M	-9.01M	55.47M	-4.47M	72.84M
Investing Cash Flow	-21.05M	-64.36M	-2.61M	-5.34M	-879.00K
Financing Cash Flow	-1.28M	-21.11M	-18.99M	126.73M	-31.24M

MEGAIN Holding (Cayman) Co. Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.46
• 50DMA: Positive
• 100DMA: Positive
• 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:6939, the sentiment is Positive. The current price of 0.46 is above the 20-day moving average (MA) of 0.45, above the 50-day MA of 0.46, and above the 200-day MA of 0.46, indicating a bullish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 52.47 is Neutral, neither overbought nor oversold. The STOCH value of 65.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:6939.

MEGAIN Holding (Cayman) Co. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$36.58B	11.16	-10.39%	1.86%	8.71%	-7.09%
6939	52 Neutral	HK$249.00M	22.28	-8.35%	4.10%	2.22%	-434.25%
PNY	―	€49.49M	0.29	-16.24%	―	―	―
JTI	―	€115.05M	―	-11.23%	―	―	―
2436	51 Neutral	HK$1.54B	―	-1.60%	―	32.83%	90.24%
3638	51 Neutral	HK$560.77M	15.28	-31.98%	―	-33.08%	-2532.02%
8159	47 Neutral	HK$68.99M	―	-52.67%	―	-1.15%	-10025.00%

MEGAIN Holding (Cayman) Co. Ltd. Corporate Events

MEGAIN Holding Reports Increased Revenue but Significant Loss in H1 2025

MEGAIN Holding (Cayman) Co., Ltd., a company incorporated in the Cayman Islands, reported its interim financial results for the six months ending June 30, 2025. The company experienced a 7.7% increase in revenue compared to the same period in 2024, reaching approximately RMB70,766,000. However, the company reported a significant loss of approximately RMB38,575,000, a stark contrast to the profit of RMB405,000 in the previous year. The loss was attributed to increased costs, including impairment losses on trade receivables, property, plant, equipment, and intangible assets, as well as higher research and development, selling, and administrative expenses. The directors have decided not to recommend the payment of any interim dividend for this period.

The most recent analyst rating on (HK:6939) stock is a Hold with a HK$0.50 price target. To see the full list of analyst forecasts on MEGAIN Holding (Cayman) Co. Ltd. stock, see the HK:6939 Stock Forecast page.

MEGAIN Holding Updates Nomination Committee Terms

MEGAIN Holding (Cayman) Co., Ltd. has announced updates to the terms of reference for its Nomination Committee, effective from August 29, 2025. The Committee, which is responsible for overseeing the nomination of directors, will consist of at least three members, with a majority being independent non-executive directors. This move aims to enhance the governance structure of the company by ensuring diversity and independence in its board appointments. The Committee is empowered to seek information from employees and professional advisers, review director performance, and obtain external advice to fulfill its duties effectively.

The most recent analyst rating on (HK:6939) stock is a Hold with a HK$0.50 price target. To see the full list of analyst forecasts on MEGAIN Holding (Cayman) Co. Ltd. stock, see the HK:6939 Stock Forecast page.

MEGAIN Holding Announces Board Composition and Committee Roles

MEGAIN Holding (Cayman) Co., Ltd. has announced the composition of its board of directors, which includes executive, non-executive, and independent non-executive directors. The announcement also details the roles and functions of each director within the company’s three board committees: Audit, Nomination, and Remuneration. This structured governance is crucial for stakeholders as it outlines the leadership and oversight within the company, potentially impacting its strategic direction and operational effectiveness.

The most recent analyst rating on (HK:6939) stock is a Hold with a HK$0.50 price target. To see the full list of analyst forecasts on MEGAIN Holding (Cayman) Co. Ltd. stock, see the HK:6939 Stock Forecast page.

MEGAIN Holding Issues Profit Warning Amidst Industry Challenges

MEGAIN Holding (Cayman) Co., Ltd. has issued a profit warning, anticipating a net loss of RMB40-60 million for the first half of 2025, compared to a net profit in the same period last year. The loss is attributed to a significant decrease in gross profit margin due to intense competition in the compatible cartridge chips industry, increased marketing and administrative expenses, and a rise in asset impairment provisions.

The most recent analyst rating on (HK:6939) stock is a Hold with a HK$0.50 price target. To see the full list of analyst forecasts on MEGAIN Holding (Cayman) Co. Ltd. stock, see the HK:6939 Stock Forecast page.

MEGAIN Holding Announces Change of Head Office Location in PRC

MEGAIN Holding (Cayman) Co., Ltd. has announced a change in its head office and principal place of business in the PRC, effective from July 21, 2025. This move to a new location in Zhuhai City, Guangdong Province, is part of the company’s strategic operations, though contact details remain unchanged.