GME Group Holdings Ltd (8188) AI Stock Analysis

• Market Cap: HK$503.20M
• Dividend Yield: 7.55%
• Average Volume (3M): 898.40K
• Price to Earnings (P/E): 6.2
• Beta (1Y): -0.24
• Revenue Growth: -6.68%
• EPS Growth: -25.58%
• Country: HK
• Employees: 588
• Sector: Industrials
• Sector Strength: 71
• Industry: Engineering & Construction
• EPS (TTM): 0.11
• Shares Outstanding: 480,340,000
• 10 Day Avg. Volume: 373,600
• 30 Day Avg. Volume: 898,400
• 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$1.00
• Price Target Upside: -6.54% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 77 Outperform
• Price Target: HK$1.00 ▼(-6.54% Downside)

The stock of GME Group Holdings Ltd scores highly due to its strong valuation, characterized by a low P/E ratio and high dividend yield. While financial performance is solid, cash flow issues present a risk. The technical analysis suggests a strong upward trend, though caution is advised due to potential overbought signals.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for services and successful project execution, enhancing the company's market position and financial health.

Profitability

Improved profitability margins suggest effective cost management and pricing strategies, contributing to sustainable financial performance.

Balance Sheet Health

A strong equity position and conservative debt strategy provide financial stability, enabling the company to withstand economic fluctuations and invest in growth.

Negative Factors

Cash Flow Challenges

Cash flow challenges highlight potential liquidity issues, which could restrict the company's ability to finance operations and growth initiatives without external funding.

Margin Volatility

Margin volatility suggests potential instability in cost management or pricing power, which could affect long-term profitability and financial predictability.

Revenue Decline

Negative revenue growth rate indicates potential challenges in maintaining contract wins or project completions, impacting future earnings potential.

GME Group Holdings Ltd Business Overview & Revenue Model

Company Description

GME Group Holdings Ltd (8188) operates primarily in the construction and engineering sector, focusing on providing civil engineering services. The company is involved in various infrastructure projects, offering services that include tunnel construction, site formation, and other related engineering tasks. GME Group Holdings Ltd leverages its expertise to contribute to large-scale infrastructure developments mainly within its region.

How the Company Makes Money

GME Group Holdings Ltd generates revenue through the provision of specialized civil engineering services. Its primary revenue streams include contracts for tunnel construction, site formation, and other infrastructure-related engineering services. The company is engaged in securing government and private sector contracts to sustain its financial performance. Key factors contributing to its earnings include the successful bidding on significant infrastructure projects and maintaining strong relationships with clients in both public and private sectors.

GME Group Holdings Ltd Financial Statement Overview

Summary

GME Group Holdings Ltd shows strong revenue and profit growth with healthy margins and stable balance sheet. However, significant cash flow challenges pose a risk to liquidity and future growth.

Income Statement

The company has demonstrated a strong revenue growth with a significant increase in total revenue from 2023 to 2024, amounting to 48.4%. Gross profit margin improved to 19.4%, and net profit margin also increased to 10.6%, indicating enhanced profitability. The EBIT margin stands at a healthy 13.3%, and the EBITDA margin is 14.3%, reflecting efficient operational management. However, past performance shows volatility in margins, requiring careful monitoring.

Balance Sheet

The balance sheet shows a solid equity position with an equity ratio of 53.7%, suggesting financial stability. The debt-to-equity ratio is 0.36, indicating a conservative debt strategy. Return on equity improved to 50.2%, showcasing effective use of equity. Despite the positive trends, maintaining low debt levels amid growth is crucial to sustain financial health.

Cash Flow

The cash flow statement reveals challenges, with operating cash flow at zero in 2024, and historical data showing negative free cash flow and operating cash flow. This highlights potential struggles in cash generation and liquidity management. The company needs to enhance cash flow operations to support its growth trajectory.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	815.18M	549.55M	440.53M	443.55M	134.57M
Gross Profit	158.15M	110.02M	13.93M	32.37M	19.56M
EBITDA	116.58M	83.98M	15.05M	19.13M	8.03M
Net Income	86.17M	61.48M	5.80M	10.45M	1.01M
Balance Sheet
Total Assets	319.56M	273.10M	156.95M	148.35M	74.08M
Cash, Cash Equivalents and Short-Term Investments	26.41M	4.47M	11.43M	5.43M	6.94M
Total Debt	62.46M	72.12M	41.30M	20.32M	5.31M
Total Liabilities	148.05M	142.03M	87.35M	84.56M	20.74M
Stockholders Equity	171.51M	130.69M	69.21M	63.40M	52.95M
Cash Flow
Free Cash Flow	105.67M	-23.61M	-21.13M	-12.97M	-7.66M
Operating Cash Flow	114.22M	-15.26M	-14.86M	-3.86M	-971.00K
Investing Cash Flow	-11.94M	-8.20M	-6.25M	-8.96M	-6.63M
Financing Cash Flow	-80.33M	16.49M	27.10M	11.31M	-2.83M

GME Group Holdings Ltd Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.07
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:8188, the sentiment is Positive. The current price of 1.07 is below the 20-day moving average (MA) of 1.08, above the 50-day MA of 1.00, and above the 200-day MA of 0.65, indicating a neutral trend. The MACD of 0.02 indicates Positive momentum. The RSI at 54.20 is Neutral, neither overbought nor oversold. The STOCH value of 38.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:8188.

GME Group Holdings Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8188	77 Outperform	HK$503.20M	6.19	45.61%	7.55%	-6.68%	-25.58%
Sector *	63 Neutral	$10.70B	15.26	7.37%	2.02%	2.87%	-14.59%
1183	―	HK$676.72M	121.43	1.51%	―	―	―
1556	79 Outperform	HK$510.00M	3.81	17.51%	5.88%	17.51%	1.48%
1447	72 Outperform	HK$208.00M	8.55	6.66%	13.46%	13.59%	-12.52%
1746	47 Neutral	HK$330.00M	―	-4.80%	―	-30.56%	-160.00%
6063	46 Neutral	HK$366.00M	114.38	2.51%	―	7.08%	-5.88%