Nexion Technologies Limited (8420) AI Stock Analysis

• Market Cap: HK$33.73M
• Dividend Yield: N/A
• Average Volume (3M): 290.00K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.08
• Revenue Growth: 52.39%
• EPS Growth: -14.75%
• Country: HK
• Employees: 16
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): N/A
• Shares Outstanding: 887,760,000
• 10 Day Avg. Volume: 262,000
• 30 Day Avg. Volume: 290,000
• PEG Ratio: -0.05
• Price to Book (P/B): 1.35
• Price to Sales (P/S): 1.49
• P/FCF Ratio: -3.54
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 40 Underperform
• Price Target: HK$0.04 ▼(-10.00% Downside)

Nexion Technologies Limited faces significant financial challenges, with declining revenue, persistent losses, and negative cash flows being the most impactful factors. The technical analysis indicates weak momentum, and the negative P/E ratio highlights valuation concerns. These factors collectively result in a low overall stock score.

Positive Factors

Revenue Growth Potential

Despite financial challenges, a revenue growth rate of 24.4% suggests potential for market expansion and increased service adoption.

Business Model

The business model relies on subscription services and long-term contracts, providing a steady revenue stream and customer retention.

Debt Management

Limited leverage risk due to low debt levels enhances financial flexibility and reduces the risk of insolvency.

Negative Factors

Declining Revenue

A significant decline in revenue indicates challenges in maintaining market position and competitiveness, impacting long-term growth.

Negative Cash Flow

Persistent negative cash flow highlights liquidity issues, limiting the company's ability to invest in growth and sustain operations.

Erosion of Equity

Diminishing equity base reflects financial instability and may hinder the company's ability to raise capital and fund future growth.

Nexion Technologies Limited Business Overview & Revenue Model

Company Description

Nexion Technologies Limited (8420) is a technology-focused company that operates in the information technology and telecommunications sectors. The company specializes in providing innovative software solutions, IT consultancy, and managed services to a diverse range of clients, including enterprises and government entities. Nexion Technologies aims to enhance operational efficiency and drive digital transformation through its core offerings, which include cloud computing services, cybersecurity solutions, and custom software development.

How the Company Makes Money

Nexion Technologies generates revenue primarily through its service offerings, which include subscription-based models for cloud services, project-based fees for custom software development, and ongoing contracts for IT consultancy and managed services. The company also earns income from partnerships with leading technology providers, allowing it to resell their products and integrate them into its solutions. Key revenue streams are bolstered by long-term contracts with clients, which provide a steady income flow, as well as performance-based incentives tied to successful project outcomes. Additionally, Nexion Technologies invests in research and development to innovate new services that meet the evolving needs of its customers, further enhancing its revenue potential.

Nexion Technologies Limited Financial Statement Overview

Summary

Nexion Technologies Limited is facing severe financial difficulties, with a drastic decline in revenue, persistent negative net income, and negative cash flows. The company's diminishing equity and asset base further highlight its financial instability and long-term sustainability concerns.

Income Statement

Nexion Technologies Limited has experienced a significant decline in revenue, with a 79.5% drop from 2020 to 2024. The company has consistently reported negative net income, with a net loss of $1,892,064 in 2024. Additionally, the gross profit margin has turned negative in 2024, indicating cost overruns. The EBIT and EBITDA margins are also negative, reflecting operational inefficiencies and challenges in the business model.

Balance Sheet

The company's balance sheet reveals a concerning trend of diminishing stockholders' equity, which decreased from $9,435,000 in 2020 to $2,159,618 in 2024. The equity ratio stood at 64.8% in 2024, indicating a moderate reliance on equity financing. However, the absence of substantial debt suggests limited leverage risk. Despite this, the declining asset base and equity indicate underlying financial challenges.

Cash Flow

Nexion Technologies Limited has faced challenges in generating positive cash flow, with a negative operating cash flow of $660,902 in 2024. The free cash flow remains negative, reflecting ongoing cash outflows. The inability to generate sufficient cash to cover net income and capital expenditures highlights liquidity issues and potential sustainability concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.02M	1.96M	12.69M	3.16M	6.96M	8.63M
Gross Profit	112.98K	-635.79K	907.00K	1.50M	1.68M	1.09M
EBITDA	-74.08K	-1.46M	-780.00K	-38.00K	-2.35M	-4.09M
Net Income	-168.64K	-1.89M	-1.76M	-1.23M	-3.11M	-5.71M
Balance Sheet
Total Assets	2.97M	3.33M	5.23M	7.17M	13.59M	11.90M
Cash, Cash Equivalents and Short-Term Investments	1.18M	1.67M	2.26M	3.95M	5.98M	5.19M
Total Debt	2.67K	6.00K	5.00K	54.00K	101.00K	0.00
Total Liabilities	919.37K	1.24M	1.08M	1.72M	7.17M	2.52M
Stockholders Equity	2.05M	2.16M	4.10M	5.43M	6.46M	9.44M
Cash Flow
Free Cash Flow	-458.97K	-823.13K	-1.45M	-2.89M	864.00K	-2.11M
Operating Cash Flow	-458.97K	-660.90K	-1.27M	-2.89M	941.00K	-611.00K
Investing Cash Flow	-143.95K	-2.09M	-168.00K	1.14M	-790.00K	-537.00K
Financing Cash Flow	-1.28K	-39.00K	381.00K	-79.00K	-23.00K	155.00K

Nexion Technologies Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.04
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:8420, the sentiment is Negative. The current price of 0.04 is below the 20-day moving average (MA) of 0.04, below the 50-day MA of 0.04, and above the 200-day MA of 0.03, indicating a neutral trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 44.19 is Neutral, neither overbought nor oversold. The STOCH value of 85.71 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:8420.

Nexion Technologies Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8062	74 Outperform	HK$118.08M	―	-0.93%	8.47%	-29.38%	-104.21%
8017	69 Neutral	HK$1.01B	14.63	39.26%	―	146.18%	1617.05%
1410	65 Neutral	HK$361.52M	14.75	27.72%	―	9.58%	48.41%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3315	61 Neutral	€789.68M	16.98	2.23%	6.40%	-16.76%	-50.21%
8613	41 Neutral	HK$109.88M	-3.17	―	―	-43.10%	-5.98%
8420	40 Underperform	HK$33.73M	―	-56.58%	―	52.39%	-14.75%