Hong Kong & China Gas (HOKCY) AI Stock Analysis

• Market Cap: $17.51B
• Dividend Yield: 5%
• Average Volume (3M): 653.00
• Price to Earnings (P/E): 24.0
• Beta (1Y): 0.11
• Revenue Growth: 0.74%
• EPS Growth: 2.92%
• Country: US
• Employees: 56,401
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Gas
• EPS (TTM): 0.02
• Shares Outstanding: 18,659,870,000
• 10 Day Avg. Volume: 225
• 30 Day Avg. Volume: 653
• PEG Ratio: 0.00
• Price to Book (P/B): 1.74
• Price to Sales (P/S): 1.80
• P/FCF Ratio: 39.37
• Enterprise Value/Market Cap: 1.35
• Enterprise Value/Revenue: 0.43
• Enterprise Value/Gross Profit: 1.00
• Enterprise Value/Ebitda: 1.62
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 65 Neutral
• Price Target: $1.00 ▲(6.38% Upside)

Hong Kong & China Gas holds a stable financial position with strong profitability and moderate leverage. The technical analysis shows mixed signals, with a slightly negative MACD and high Stochastic, suggesting potential caution. Valuation metrics are favorable, especially the attractive dividend yield. However, declining revenue and minimal cash flow growth present challenges that need to be addressed.

Hong Kong & China Gas Business Overview & Revenue Model

Company Description

Hong Kong & China Gas Company Limited (HOKCY), commonly known as Towngas, is one of the largest utility companies in Hong Kong. The company primarily operates in the energy sector, providing gas, water, and related services. It serves a diverse range of customers, including residential, commercial, and industrial clients, with core offerings in town gas, liquefied petroleum gas (LPG), and other energy solutions. Towngas has expanded its operations beyond Hong Kong into mainland China, where it engages in the distribution of piped gas and the development of new energy projects.

How the Company Makes Money

Hong Kong & China Gas Company Limited generates revenue through several key streams. The primary source of income is the sale of town gas and LPG to residential, commercial, and industrial customers in Hong Kong and mainland China. Additionally, the company earns income from infrastructure projects, such as the construction and maintenance of gas pipelines and facilities. Towngas has also diversified its revenue base by investing in new energy projects, including renewable energy initiatives and water supply services. The company's extensive customer base, strategic partnerships, and investments in energy infrastructure contribute significantly to its earnings.

Hong Kong & China Gas Financial Statement Overview

Summary

Hong Kong & China Gas exhibits a stable financial position with strong profitability and cash generation capabilities. However, declining revenues and minimal free cash flow growth present potential challenges. The company's moderate leverage and good return on equity indicate strong financial management, yet continuous monitoring of revenue trends is essential.

Income Statement

The company shows stable gross and net profit margins with a gross profit margin of approximately 41.65% and a net profit margin of 10.29% for the latest annual period. However, there has been a decline in revenue over the past year, with a revenue decrease of 2.63%. EBIT and EBITDA margins are also strong, indicating efficient operations. These figures suggest profitability, but the declining revenue is a concern.

Balance Sheet

The balance sheet is solid with a debt-to-equity ratio of 1.02, indicating moderate leverage. The equity ratio stands at 36.27%, showing a reasonable proportion of equity financing. However, the slight decline in stockholders' equity over the year may indicate some financial pressure. The return on equity is strong at 9.95%, reflecting effective management of equity.

Cash Flow

The company maintains positive free cash flow, though it shows minimal growth at 1.44% over the previous year. The operating cash flow to net income ratio is robust at 1.58, suggesting healthy cash generation relative to profits. However, the free cash flow to net income ratio is lower at 0.44, indicating significant capital expenditures which may impact cash availability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	55.49B	55.47B	56.97B	60.95B	53.56B	40.93B
Gross Profit	23.61B	23.11B	21.98B	14.38B	14.02B	12.72B
EBITDA	14.67B	14.32B	11.88B	11.67B	11.89B	11.34B
Net Income	5.64B	5.71B	6.18B	5.36B	5.13B	6.12B
Balance Sheet
Total Assets	162.42B	158.27B	161.98B	168.47B	168.07B	150.28B
Cash, Cash Equivalents and Short-Term Investments	9.79B	7.69B	10.41B	13.36B	10.63B	7.83B
Total Debt	62.26B	58.81B	56.91B	60.44B	58.15B	45.31B
Total Liabilities	93.50B	89.94B	90.96B	95.71B	88.61B	73.51B
Stockholders Equity	57.61B	57.39B	59.85B	63.61B	69.81B	66.76B
Cash Flow
Free Cash Flow	4.00B	2.54B	2.50B	1.40B	2.20B	3.29B
Operating Cash Flow	9.82B	9.00B	10.93B	9.73B	10.62B	10.58B
Investing Cash Flow	-1.02B	-2.31B	-2.50B	-8.41B	-13.47B	-8.17B
Financing Cash Flow	-9.16B	-9.21B	-12.45B	1.91B	5.39B	-3.01B

Hong Kong & China Gas Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.94
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HOKCY, the sentiment is Positive. The current price of 0.94 is above the 20-day moving average (MA) of 0.89, above the 50-day MA of 0.89, and above the 200-day MA of 0.84, indicating a bullish trend. The MACD of 0.01 indicates Negative momentum. The RSI at 78.41 is Negative, neither overbought nor oversold. The STOCH value of 102.09 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HOKCY.

Hong Kong & China Gas Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ATO	79 Outperform	$28.53B	24.36	9.05%	1.96%	12.90%	7.70%
NJR	74 Outperform	$4.72B	11.41	18.03%	3.88%	21.88%	71.35%
SWX	67 Neutral	$5.71B	29.19	5.41%	3.12%	-10.07%	5.98%
NI	67 Neutral	$20.65B	22.98	10.56%	2.52%	16.98%	12.45%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
HOKCY	65 Neutral	$17.51B	23.97	9.86%	5.00%	0.74%	2.92%
UGI	62 Neutral	$7.04B	17.08	8.75%	4.58%	-0.52%	-39.42%