Hong Kong Exchanges & Clearing (HKXCY) AI Stock Analysis

• Market Cap: $69.28B
• Dividend Yield: 2.52%
• Average Volume (3M): 6.32K
• Price to Earnings (P/E): 35.0
• Beta (1Y): 0.48
• Revenue Growth: 35.69%
• EPS Growth: 30.09%
• Country: US
• Employees: 2,444
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Data & Stock Exchanges
• EPS (TTM): 0.50
• Shares Outstanding: 1,267,837,000
• 10 Day Avg. Volume: 3,748
• 30 Day Avg. Volume: 6,317
• PEG Ratio: 2.75
• Price to Book (P/B): 6.85
• Price to Sales (P/S): 21.25
• P/FCF Ratio: 33.00
• Enterprise Value/Market Cap: 5.20
• Enterprise Value/Revenue: 20.78
• Enterprise Value/Gross Profit: 24.35
• Enterprise Value/Ebitda: 20.57
• 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: 66 Neutral
• Price Target: $59.00 ▲(8.12% Upside)

The overall score is primarily driven by strong financial performance, despite concerns about declining revenue growth. Technical indicators suggest bearish momentum, and the stock appears overvalued based on its P/E ratio.

Positive Factors

Profitability

High profitability margins indicate efficient operations and strong competitive positioning, supporting long-term financial health.

Balance Sheet Health

Low leverage and strong equity position enhance financial stability, providing resilience against economic downturns and flexibility for growth.

Cash Flow Generation

Efficient cash generation supports ongoing operations and investments, ensuring the company can fund growth initiatives and withstand market volatility.

Negative Factors

Revenue Decline

Declining revenue growth can signal challenges in market demand or competitive pressures, potentially impacting future profitability and expansion.

Revenue Growth Concerns

Sustained revenue growth is crucial for long-term success; declining trends may indicate underlying business model or market issues.

Market Position Challenges

While financials are strong, declining revenue suggests potential market position challenges, which could affect future competitiveness and growth.

Hong Kong Exchanges & Clearing Business Overview & Revenue Model

Company Description

Hong Kong Exchanges and Clearing Limited, together with its subsidiaries, owns and operates stock exchanges and futures exchanges, and related clearing houses in Hong Kong, Mainland China, and the United Kingdom. It operates through five segments: Cash, Equity and Financial Derivatives, Commodities, Post Trade, and Technology. The Cash segment covers various equity products traded on the cash market platforms of the Stock Exchange of Hong Kong Limited, the Shanghai Stock Exchange, and the Shenzhen Stock Exchange; sale of market data relating to the products; and other related activities. The Equity and Financial Derivatives segment provides and maintains trading platforms for a range of equity and financial derivative products, such as stock and equity index futures and options, derivative warrants, and callable bull/bear contracts and warrants, as well as sells related market data. The Commodities segment operates an exchange for the trading of base, ferrous, and precious metals futures and options contracts in the United Kingdom; and operates Qianhai Mercantile Exchange Co., Ltd., a commodity trading platform in the Mainland. This segment also covers commodities contracts traded on Futures Exchange. The Post Trade segment operates clearing houses that are responsible for clearing, settlement, depository, custodian, and nominee services. The Technology segment offers various services that provide users with access to the platform and infrastructure. The company serves issuers and investors. Hong Kong Exchanges and Clearing Limited is based in Central, Hong Kong.

How the Company Makes Money

HKXCY generates revenue through multiple key streams. The primary source of income comes from transaction fees charged on trades executed on its platforms, which includes commissions from both buyers and sellers. Additionally, the company earns revenue from listing fees paid by companies when they go public and from annual fees charged to listed companies. Clearing and settlement services also contribute significantly to its revenue, as HKEX charges fees for the clearing of trades and the maintenance of accounts. Furthermore, data services, including market data and information products, provide another stream of income. Strategic partnerships with global financial institutions and initiatives to expand its product offerings and market reach also enhance HKEX's revenue potential.

Hong Kong Exchanges & Clearing Financial Statement Overview

Summary

The company shows strong profitability with high net profit and EBIT margins, and a robust balance sheet with low leverage. However, the decline in revenue growth is a concern.

Income Statement

The company has demonstrated strong profitability with a consistent net profit margin of around 75% and a healthy EBIT margin of over 85%. However, there is a noticeable decline in total revenue from 2023 to 2024, indicating a revenue growth rate of -14.94%, which is a concern for future growth.

Balance Sheet

The balance sheet shows robust equity levels with a debt-to-equity ratio of 0.02 in 2024, indicating low leverage and financial stability. The equity ratio is around 14.11%, highlighting a solid equity position. Return on equity remains strong at 24.23%, demonstrating efficient use of equity to generate profits.

Cash Flow

The company has a stable cash flow position with a slight increase in free cash flow from 2023 to 2024, resulting in a free cash flow growth rate of 10.43%. The operating cash flow to net income ratio is close to 1, reflecting efficient cash generation from operations relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	17.35B	17.35B	20.39B	18.27B	20.75B	19.05B
Gross Profit	14.81B	12.94B	19.52B	17.48B	19.98B	18.35B
EBITDA	17.53B	22.15B	20.87B	12.29B	16.34B	13.91B
Net Income	12.30B	13.05B	11.86B	10.08B	12.54B	11.51B
Balance Sheet
Total Assets	424.87B	381.63B	341.18B	406.05B	399.30B	399.11B
Cash, Cash Equivalents and Short-Term Investments	282.46B	230.91B	203.98B	276.39B	342.33B	328.61B
Total Debt	873.00M	1.68B	2.05B	2.24B	2.06B	2.78B
Total Liabilities	367.42B	327.22B	289.38B	355.95B	349.39B	349.87B
Stockholders Equity	56.91B	53.85B	51.34B	49.73B	49.63B	48.92B
Cash Flow
Free Cash Flow	0.00	11.17B	10.11B	13.67B	11.27B	13.42B
Operating Cash Flow	0.00	12.77B	11.50B	14.96B	12.34B	14.77B
Investing Cash Flow	0.00	3.19B	-6.29B	-1.70B	2.28B	-7.48B
Financing Cash Flow	0.00	-11.26B	-11.25B	-10.37B	-12.67B	-7.47B

Hong Kong Exchanges & Clearing Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 54.57
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HKXCY, the sentiment is Positive. The current price of 54.57 is above the 20-day moving average (MA) of 52.66, above the 50-day MA of 53.50, and above the 200-day MA of 52.06, indicating a bullish trend. The MACD of 0.41 indicates Negative momentum. The RSI at 61.05 is Neutral, neither overbought nor oversold. The STOCH value of 87.01 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HKXCY.

Hong Kong Exchanges & Clearing Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ICE	80 Outperform	$92.36B	30.22	11.32%	1.19%	8.96%	30.16%
NDAQ	78 Outperform	$56.95B	35.03	14.07%	1.07%	16.41%	68.03%
MCO	77 Outperform	$94.76B	42.74	57.08%	0.73%	8.77%	13.62%
CBOE	75 Outperform	$27.31B	28.01	21.51%	1.06%	16.74%	26.74%
CME	74 Outperform	$96.15B	25.44	13.35%	3.92%	5.84%	8.51%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
HKXCY	66 Neutral	$69.28B	35.04	28.32%	2.52%	35.69%	30.09%