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Swire Pacific Limited (SWRAY)
OTHER OTC:SWRAY
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Swire Pacific
(OTC:SWRAY)
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Rating:72Outperform
Price Target:
$9.50
â–²(12.03% Upside)
Swire Pacific's overall stock score is driven by its strong financial stability and positive earnings call insights, particularly in the Property and Aviation sectors. However, high valuation metrics and mixed technical indicators temper the score. The company's robust dividend yield and strategic investments provide a positive outlook, but challenges in profitability and certain market segments remain.
Positive Factors
Strong Property Division Performance
The Property division's strong performance and strategic disposals enhance Swire Pacific's financial stability and growth prospects in real estate.
Aviation Sector Growth
The growth in the Aviation sector, especially HAECO's profit increase, indicates robust demand and operational efficiency, supporting long-term growth.
Expansion in Beverages Segment
Investments in new facilities strengthen Swire Pacific's market position in the beverage sector, enhancing production capacity and distribution reach.
Negative Factors
Decline in Statutory Profit
The decline in statutory profit reflects challenges in asset valuation, potentially affecting investor confidence and financial performance.
Challenges in Southeast Asia Beverages
The significant EBITDA decline in Southeast Asia highlights regional market challenges, impacting profitability and requiring strategic adjustments.
Soft Hong Kong Office Market
A soft office market in Hong Kong affects rental income, posing challenges to Swire Pacific's property segment and overall revenue stability.
Swire Pacific (SWRAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$10.95B
Dividend Yield5.04%
Average Volume (3M)5.90K
Price to Earnings (P/E)72.2
Beta (1Y)-0.04
Revenue Growth6.84%
EPS Growth-95.35%
CountryUS
Employees87,000
SectorIndustrials
Sector Strength72
IndustryConglomerates
Share Statistics
EPS (TTM)0.51
Shares Outstanding778,988,000
10 Day Avg. Volume3,156
30 Day Avg. Volume5,903
Financial Highlights & Ratios
PEG Ratio-0.27
Price to Book (P/B)0.39
Price to Sales (P/S)1.22
P/FCF Ratio16.98
Enterprise Value/Market Cap16.03
Enterprise Value/Revenue1.99
Enterprise Value/Gross Profit5.37
Enterprise Value/Ebitda11.19
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Buy
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Swire Pacific Business Overview & Revenue Model
Company DescriptionSwire Pacific Limited engages in property, aviation, beverages, marine, and trading and industrial businesses in Hong Kong, Mainland China, rest of Asia, the United States, and internationally. The company's Property division develops, owns, and operates mixed-use properties. This division's property investment portfolio comprises office and retail premises, serviced apartments, other luxury residential accommodations, and commercial mixed-use developments; and trading portfolio consists of residential properties. It also owns and manages two hotels in Hong Kong and four hotels in Mainland China, as well as owns interests in the Mandarin Oriental hotel in the United States. The company's Aviation division provides flight catering and ramp, passenger and cargo services, and aircraft maintenance and modification services. As of December 31, 2021, it had a fleet of 234 aircraft. Its Beverages division owns rights to manufacture, market, and distribute refreshing soft drinks to consumers. The company's Trading & Industrial division retails and distributes footwear, apparel, and accessories through its 164 retail outlets; sells passenger cars, commercial vehicles, motorcycles, and scooters; operates a chain of 538 bakery stores; packages and sells sugar products under the Taikoo Sugar brand; and offers waste management services. The company was founded in 1816 and is based in Central, Hong Kong.
How the Company Makes MoneySwire Pacific generates revenue through multiple key streams. Its property division, Swire Properties, earns income through leasing and selling residential and commercial properties, benefiting from the high demand in Hong Kong and mainland China. The aviation segment, represented by Cathay Pacific, contributes significantly through passenger and cargo transport services, though it can be affected by global travel trends and economic conditions. The beverages sector, under Swire Beverages, profits from the production and distribution of soft drinks, primarily Coca-Cola products in the Asia-Pacific region. Additionally, Swire Pacific engages in marine services and trading activities, providing further revenue diversification. Strategic partnerships with global brands and entities in various sectors enhance its market position and profitability, while investments in infrastructure and sustainable projects are aimed at long-term growth.
Swire Pacific Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Mar 12, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted strong performances in the Property and Aviation divisions, along with significant investments and achievements in the Beverages segment despite some regional challenges. However, the call also acknowledged difficulties in the Southeast Asia beverage market, a decline in statutory profit, and ongoing softness in the Hong Kong office market.Q2-2025 Updates
Positive Updates
Strong Underlying Profit from Property Division
The Property division showed strong underlying profit, benefiting from the disposal of retail properties and land in Miami. The division is 67% committed to its HKD 100 billion investment plan over the next 10 years, with 7 major projects under construction in the Chinese Mainland.
Successful Sales of Residential Properties in Shanghai
Swire Properties successfully sold the first residences in Lujiazui Taikoo Yuan, Shanghai, with two batches nearly sold out within an hour each, marking a major milestone for Swire Properties in the Chinese Mainland residential sector.
Positive Growth in Aviation Sector
The Aviation division performed well, with HAECO achieving a 40% growth in recurring profit and Cathay Pacific showing a solid performance with increased passenger volumes and a consistent cargo performance.
Swire Coca-Cola Expansion
Swire Coca-Cola announced significant investments in new production facilities in the Chinese Mainland, Vietnam, and Hainan. Revenue from the Chinese Mainland increased by 3% with an improved EBITDA margin of 12.8%.
Strong Cash Generation and Dividend Policy
Strong cash generated from operations and a progressive dividend policy with a 4% increase in the ordinary dividend per A Share to HKD 130.
Negative Updates
Challenges in Southeast Asia Beverages Segment
The Beverages segment faced challenges in Southeast Asia, with EBITDA decreasing by 28% in Vietnam and Cambodia due to the depreciation of the Vietnamese dong, competitive environment in Thailand, and expenses related to the relocation of the Ho Chi Minh plant.
Decline in Statutory Profit
Statutory profit decreased to HKD 815 million, mainly due to changes in the value of investment properties.
Soft Hong Kong Office Market
The Hong Kong office market remained soft, impacting rental income, though partially offset by a strong retail market in the Chinese Mainland.
Challenges in Thailand Beverage Market
The beverage business in Thailand faced challenges due to deteriorating economic conditions, reduced tourism activity, and the implementation of sugar tax legislation.
Company Guidance
During the Swire Pacific 2025 Interim Results Analyst Briefing, the company provided guidance on several key metrics and strategic directions. The Property division demonstrated strong underlying profit, bolstered by significant disposals in Miami, which has already achieved 67% of its HKD 100 billion investment plan within three years. Seven major projects are under construction in the Chinese Mainland, indicating robust development activity. Swire Properties saw success with the sale of residences in Lujiazui Taikoo Yuan, Shanghai, marking a milestone in the residential sector. The Beverages division reported a solid performance, with four new production plants under construction in the Chinese Mainland and the inauguration of a new plant in Vietnam. Aviation continued to thrive, with Cathay Pacific and HAECO performing well, the latter achieving a 40% growth in recurring profit in the first half. Financially, the group maintained an underlying profit of HKD 5.5 billion and a recurring underlying profit of HKD 4.7 billion, with a decision to increase ordinary dividends per A Share by 4% to HKD 1.30. The company emphasized a strong balance sheet with a gearing of 23% and a weighted average cost of debt at 3.7%. Additionally, Swire Pacific is committed to sustainability, with Swire Properties and Swire Beverages leading in renewable energy usage, contributing to 60% and 55% respectively of their energy consumption.Swire Pacific Financial Statement Overview
Summary
Swire Pacific's financial performance is stable with a strong balance sheet and healthy cash flows. However, declining profitability and revenue, as reflected in the income statement, are areas of concern. The balance sheet remains robust with a strong equity ratio, but the drop in return on equity indicates reduced profitability.Income Statement
Swire Pacific's income statement reflects stable performance with a slight decline in revenue from 2023 to 2024. Gross profit margin is strong at around 37.2%, but net profit margin dipped significantly to 5.27% in 2024 from a higher 30.42% in 2023. The EBIT and EBITDA margins have also contracted from 32.29% and 42.80% in 2023 to 5.17% and 17.84% in 2024, indicating decreased operational efficiency.Balance Sheet
The balance sheet shows a robust equity ratio of 54.20% in 2024, demonstrating financial stability with strong shareholder equity. However, the debt-to-equity ratio increased slightly to 0.37, indicating a manageable level of leverage. The return on equity has dropped significantly from 10.76% in 2023 to 1.67% in 2024, reflecting lower profitability.Cash Flow
Operating cash flow remains healthy at over $10 billion, with a consistent free cash flow, though it decreased slightly in 2024. The operating cash flow to net income ratio is strong at 2.42, indicating efficient cash management. However, the free cash flow to net income ratio shows a decline as net income reduced significantly.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 88.18B | 81.97B | 94.82B | 91.17B | 90.80B | 78.36B |
| Gross Profit | 32.69B | 30.46B | 35.15B | 34.19B | 35.28B | 30.50B |
| EBITDA | 15.69B | 14.62B | 40.58B | 16.07B | 16.41B | 13.79B |
| Net Income | 1.22B | 4.32B | 28.85B | 4.20B | 5.12B | -11.00B |
Balance Sheet | ||||||
| Total Assets | 480.03B | 476.56B | 447.75B | 434.77B | 436.32B | 433.11B |
| Cash, Cash Equivalents and Short-Term Investments | 26.84B | 21.03B | 14.08B | 11.61B | 22.89B | 29.26B |
| Total Debt | 103.84B | 96.61B | 74.90B | 73.29B | 66.89B | 73.32B |
| Total Liabilities | 165.94B | 157.89B | 122.98B | 118.83B | 112.15B | 113.96B |
| Stockholders Equity | 257.88B | 258.30B | 268.13B | 258.46B | 266.95B | 262.69B |
Cash Flow | ||||||
| Free Cash Flow | 8.25B | 5.89B | 6.32B | 4.73B | 7.45B | 8.46B |
| Operating Cash Flow | 13.39B | 10.46B | 9.92B | 8.16B | 11.66B | 11.46B |
| Investing Cash Flow | -9.40B | -14.60B | 13.03B | -17.54B | -6.34B | 1.73B |
| Financing Cash Flow | 5.02B | 12.62B | -21.73B | -1.40B | -12.34B | -5.69B |
Swire Pacific Technical Analysis
Neutral
8.48
Price Trends
8.47
Negative
8.49
Negative
8.51
Negative
Market Momentum
-0.08
Negative
49.42
Neutral
79.02
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SWRAY, the sentiment is Neutral. The current price of 8.48 is above the 20-day moving average (MA) of 8.25, above the 50-day MA of 8.47, and below the 200-day MA of 8.51, indicating a neutral trend. The MACD of -0.08 indicates Negative momentum. The RSI at 49.42 is Neutral, neither overbought nor oversold. The STOCH value of 79.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SWRAY.
Swire Pacific Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $130.30B | 21.85 | 35.85% | 2.24% | 7.48% | 9.55% | |
72 Outperform | $10.95B | 72.21 | 0.47% | 5.04% | 6.84% | -95.35% | |
71 Outperform | $8.28B | 36.62 | 14.90% | 0.63% | 1.23% | -22.77% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
61 Neutral | $3.59B | 74.12 | 34.20% | 1.01% | -3.95% | -74.65% | |
59 Neutral | $87.78B | 26.41 | 73.38% | 1.82% | -13.09% | -20.63% | |
48 Neutral | $4.72B | -9.95 | -12.71% | 27.59% | -8.45% | 27.66% |
* Industrials Sector Average
SWRAY
Swire Pacific
8.48
0.10
1.23%
MMM
3M
165.24
36.46
28.31%
GFF
Griffon
77.63
7.60
10.85%
HON
Honeywell International
205.24
4.06
2.02%
IEP
Icahn Enterprises
7.86
0.00
0.00%
VMI
Valmont
420.24
120.34
40.13%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.