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

• Market Cap: HK$246.41M
• Dividend Yield: 4.14%
• Average Volume (3M): 19.40K
• Price to Earnings (P/E): 23.5
• Beta (1Y): 0.57
• Revenue Growth: -14.89%
• EPS Growth: -59.44%
• Country: HK
• Employees: 161
• Sector: Technology
• Sector Strength: 82
• Industry: Computer Hardware
• EPS (TTM): 0.02
• Shares Outstanding: 518,750,000
• 10 Day Avg. Volume: 3,400
• 30 Day Avg. Volume: 19,400
• PEG Ratio: 0.20
• Price to Book (P/B): 0.84
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 6.26
• 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

• Rating: 56 Neutral
• Price Target: ―

MEGAIN Holding's stock scores moderately due to mixed financial performance highlighted by strong equity but declining revenues and negative margins. Technical analysis shows neutral momentum, providing no clear direction. Valuation indicates potential overvaluation with a reasonable dividend yield. Overall, the stock presents moderate investment risk with some income potential.

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 printing consumables, including printer cartridges and related products. The company earns money by supplying these products to both individual consumers and businesses, capitalizing on the ongoing demand for printer supplies. MEGAIN's revenue streams are bolstered by its distribution network and partnerships with retailers and suppliers, ensuring wide availability and accessibility of its products in various markets.

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

Summary

MEGAIN Holding (Cayman) Co. Ltd. exhibits mixed financial health. The company has a strong balance sheet with high equity and low leverage. However, there are significant concerns with declining revenues, negative margins, and an absence of positive cash flow, indicating liquidity challenges. These issues suggest operational inefficiencies and risks to revenue growth and profitability.

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
	EBIT
-5.38M	20.80M	54.77M	39.88M	36.05M
	EBITDA
-3.95M	33.47M	60.44M	44.88M	40.69M
	Net Income Common Stockholders
9.66M	23.21M	44.89M	31.26M	28.75M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
229.19M	243.83M	277.13M	238.35M	123.47M
	Total Assets
410.19M	390.21M	404.27M	360.16M	197.24M
	Total Debt
10.62M	1.88M	3.97M	9.08M	1.59M
	Net Debt
-161.73M	-181.95M	-273.16M	-229.26M	-121.87M
	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
0.00	-19.36M	49.02M	-12.73M	70.04M
	Operating Cash Flow
0.00	-9.01M	55.47M	-4.47M	72.84M
	Investing Cash Flow
0.00	-64.36M	-2.61M	-5.34M	-879.00K
	Financing Cash Flow
0.00	-21.11M	-18.99M	126.73M	-31.24M

MEGAIN Holding (Cayman) Co. Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.48
• 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 0.48 is above the 20-day moving average (MA) of 0.45, above the 50-day MA of 0.45, and above the 200-day MA of 0.48, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 62.70 is Neutral, neither overbought nor oversold. The STOCH value of 73.33 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 *	62 Neutral	$11.92B	10.48	-7.50%	2.95%	7.40%	-8.18%
6939	56 Neutral	HK$246.41M	23.51	2.61%	4.14%	-14.89%	-59.44%
CCOHF		$8.14B	6.30	14.62%	5.64%	―	―
CSCHF		$298.90M	―	-2.94%	―	―	―
PPCCF		$43.30B	9.58	13.15%	6.06%	―	―
6198	83 Outperform	HK$60.77B	7.74	12.46%	3.62%	5.80%	5.59%
3318	51 Neutral	HK$1.84B	91.85	0.59%	―	-21.05%	-87.68%

MEGAIN Holding (Cayman) Co. Ltd. Corporate Events

MEGAIN Holding Announces 2025 AGM with Key Resolutions

MEGAIN Holding (Cayman) Co., Ltd. has announced its upcoming annual general meeting (AGM) to be held on June 6, 2025, via an eVoting Portal. The meeting will address several key resolutions, including the approval of the audited financial statements for 2024, the re-election of Mr. Lam Tsz Leung as a non-executive director, and the re-appointment of BDO Limited as the company’s auditor. Additionally, the AGM will consider resolutions to authorize the directors to allot and issue additional ordinary shares, subject to certain conditions. This meeting is crucial for stakeholders as it will determine the company’s financial and strategic direction for the coming year.

MEGAIN Holding Reports Decline in 2024 Financial Results

MEGAIN Holding (Cayman) Co., Ltd. announced a significant decline in its financial performance for the year ended December 31, 2024. The company’s revenue decreased by 13.2%, gross profit fell by 28.0%, and profit after income tax dropped by 58.4%. The board has decided not to recommend any final dividend for the year, reflecting the challenging financial period.

MEGAIN Holding Schedules Board Meeting for Annual Results and Dividend Decision

MEGAIN Holding (Cayman) Co., Ltd. has announced that its board of directors will convene a meeting on March 31, 2025. The meeting’s agenda includes the approval and publication of the company’s annual results for the year ending December 31, 2024, and the consideration of a final dividend recommendation.

MEGAIN Holding Issues Profit Warning Amidst Strategic Shift

MEGAIN Holding has issued a profit warning, anticipating a significant decrease in net profit for the fiscal year 2024, with an expected drop of 82% to 92% compared to the previous year. This decline is attributed to increased competition in the compatible cartridge chips industry, lack of revenue from technical and design services, and rising expenses in marketing, research, and provision for impairment on receivables. The announcement highlights the company’s strategic shift towards new business development despite current financial challenges.