HOLLYSYS AUTOMATION TECHNOLO (HOLI) Stock Fundamental Analysis
NASDAQ:HOLI - Nasdaq - VGG456671053 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to HOLI. HOLI was compared to 125 industry peers in the Electronic Equipment, Instruments & Components industry. While HOLI has a great health rating, its profitability is only average at the moment. HOLI has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year HOLI was profitable.
In the past year HOLI had a positive cash flow from operations.
HOLI had positive earnings in each of the past 5 years.
HOLI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of HOLI (4.19%) is better than 66.14% of its industry peers.
HOLI has a better Return On Equity (6.13%) than 60.63% of its industry peers.
The Return On Invested Capital of HOLI (4.57%) is better than 61.42% of its industry peers.
HOLI had an Average Return On Invested Capital over the past 3 years of 6.19%. This is below the industry average of 9.38%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.19% | ||
| ROE | 6.13% | ||
| ROIC | 4.57% |
ROA(3y)5.65%
ROA(5y)6.47%
ROE(3y)8.04%
ROE(5y)9.09%
ROIC(3y)6.19%
ROIC(5y)7.91%
1.3 Margins
Looking at the Profit Margin, with a value of 9.52%, HOLI belongs to the top of the industry, outperforming 82.68% of the companies in the same industry.
HOLI's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 8.63%, HOLI is in the better half of the industry, outperforming 75.59% of the companies in the same industry.
HOLI's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 31.07%, HOLI perfoms like the industry average, outperforming 51.97% of the companies in the same industry.
HOLI's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.63% | ||
| PM (TTM) | 9.52% | ||
| GM | 31.07% |
OM growth 3Y-16.97%
OM growth 5Y-11.65%
PM growth 3Y-4.47%
PM growth 5Y-7.05%
GM growth 3Y-4.62%
GM growth 5Y-2.9%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so HOLI is destroying value.
Compared to 1 year ago, HOLI has about the same amount of shares outstanding.
HOLI has more shares outstanding than it did 5 years ago.
The debt/assets ratio for HOLI is higher compared to a year ago.
2.2 Solvency
HOLI has an Altman-Z score of 3.81. This indicates that HOLI is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.81, HOLI is in the better half of the industry, outperforming 67.72% of the companies in the same industry.
HOLI has a debt to FCF ratio of 1.59. This is a very positive value and a sign of high solvency as it would only need 1.59 years to pay back of all of its debts.
The Debt to FCF ratio of HOLI (1.59) is better than 72.44% of its industry peers.
HOLI has a Debt/Equity ratio of 0.04. This is a healthy value indicating a solid balance between debt and equity.
HOLI has a Debt to Equity ratio (0.04) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.04 | ||
| Debt/FCF | 1.59 | ||
| Altman-Z | 3.81 |
ROIC/WACC0.61
WACC7.49%
2.3 Liquidity
HOLI has a Current Ratio of 3.02. This indicates that HOLI is financially healthy and has no problem in meeting its short term obligations.
HOLI's Current ratio of 3.02 is fine compared to the rest of the industry. HOLI outperforms 63.78% of its industry peers.
HOLI has a Quick Ratio of 2.80. This indicates that HOLI is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of HOLI (2.80) is better than 74.02% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.02 | ||
| Quick Ratio | 2.8 |
3. Growth
3.1 Past
HOLI shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -27.98%.
The Earnings Per Share has been decreasing by -0.30% on average over the past years.
The Revenue has been growing slightly by 3.60% in the past year.
HOLI shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.53% yearly.
EPS 1Y (TTM)-27.98%
EPS 3Y9.58%
EPS 5Y-0.3%
EPS Q2Q%-66.37%
Revenue 1Y (TTM)3.6%
Revenue growth 3Y15.59%
Revenue growth 5Y7.53%
Sales Q2Q%3.48%
3.2 Future
The Earnings Per Share is expected to grow by 17.20% on average over the next years. This is quite good.
HOLI is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 15.31% yearly.
EPS Next Y24.79%
EPS Next 2Y17.2%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year9.43%
Revenue Next 2Y12.33%
Revenue Next 3Y15.31%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
HOLI is valuated rather expensively with a Price/Earnings ratio of 21.83.
Based on the Price/Earnings ratio, HOLI is valued a bit cheaper than 70.08% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.15. HOLI is around the same levels.
With a Price/Forward Earnings ratio of 11.40, the valuation of HOLI can be described as very reasonable.
Based on the Price/Forward Earnings ratio, HOLI is valued cheaper than 87.40% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of HOLI to the average of the S&P500 Index (21.60), we can say HOLI is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.83 | ||
| Fwd PE | 11.4 |
4.2 Price Multiples
72.44% of the companies in the same industry are more expensive than HOLI, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HOLI is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 39.84 | ||
| EV/EBITDA | 12.54 |
4.3 Compensation for Growth
HOLI's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as HOLI's earnings are expected to grow with 17.20% in the coming years.
PEG (NY)0.88
PEG (5Y)N/A
EPS Next 2Y17.2%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.93%, HOLI has a reasonable but not impressive dividend return.
HOLI's Dividend Yield is rather good when compared to the industry average which is at 1.95. HOLI pays more dividend than 94.49% of the companies in the same industry.
HOLI's Dividend Yield is slightly below the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
5.2 History
HOLI has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DP0%
EPS Next 2Y17.2%
EPS Next 3YN/A
26.42
+0.01 (+0.04%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners10.59%
Inst Owner Change-76.35%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap1.64B
Analysts43.33
Price Target24.74 (-6.36%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.93% |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)0.34%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)-4.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.83 | ||
| Fwd PE | 11.4 | ||
| P/S | 2.07 | ||
| P/FCF | 39.84 | ||
| P/OCF | 23.19 | ||
| P/B | 1.34 | ||
| P/tB | 1.37 | ||
| EV/EBITDA | 12.54 |
EPS(TTM)1.21
EY4.58%
EPS(NY)2.32
Fwd EY8.77%
FCF(TTM)0.66
FCFY2.51%
OCF(TTM)1.14
OCFY4.31%
SpS12.73
BVpS19.78
TBVpS19.33
PEG (NY)0.88
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.19% | ||
| ROE | 6.13% | ||
| ROCE | 5.26% | ||
| ROIC | 4.57% | ||
| ROICexc | 10.03% | ||
| ROICexgc | 10.52% | ||
| OM | 8.63% | ||
| PM (TTM) | 9.52% | ||
| GM | 31.07% | ||
| FCFM | 5.21% |
ROA(3y)5.65%
ROA(5y)6.47%
ROE(3y)8.04%
ROE(5y)9.09%
ROIC(3y)6.19%
ROIC(5y)7.91%
ROICexc(3y)14.59%
ROICexc(5y)17.88%
ROICexgc(3y)15.16%
ROICexgc(5y)18.66%
ROCE(3y)7.13%
ROCE(5y)9.11%
ROICexcg growth 3Y-12.11%
ROICexcg growth 5Y-9.6%
ROICexc growth 3Y-13.32%
ROICexc growth 5Y-8.4%
OM growth 3Y-16.97%
OM growth 5Y-11.65%
PM growth 3Y-4.47%
PM growth 5Y-7.05%
GM growth 3Y-4.62%
GM growth 5Y-2.9%
F-Score2
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.04 | ||
| Debt/FCF | 1.59 | ||
| Debt/EBITDA | 0.64 | ||
| Cap/Depr | 276.05% | ||
| Cap/Sales | 3.74% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 89.61% | ||
| Profit Quality | 54.69% | ||
| Current Ratio | 3.02 | ||
| Quick Ratio | 2.8 | ||
| Altman-Z | 3.81 |
F-Score2
WACC7.49%
ROIC/WACC0.61
Cap/Depr(3y)270.81%
Cap/Depr(5y)206.75%
Cap/Sales(3y)4.01%
Cap/Sales(5y)3.1%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-27.98%
EPS 3Y9.58%
EPS 5Y-0.3%
EPS Q2Q%-66.37%
EPS Next Y24.79%
EPS Next 2Y17.2%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)3.6%
Revenue growth 3Y15.59%
Revenue growth 5Y7.53%
Sales Q2Q%3.48%
Revenue Next Year9.43%
Revenue Next 2Y12.33%
Revenue Next 3Y15.31%
Revenue Next 5YN/A
EBIT growth 1Y-27.71%
EBIT growth 3Y-4.02%
EBIT growth 5Y-5%
EBIT Next Year41.62%
EBIT Next 3Y17.8%
EBIT Next 5YN/A
FCF growth 1Y103.99%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y52.83%
OCF growth 3Y-49.04%
OCF growth 5Y-26.18%