It is hard to get excited after looking at Green Future Food Hydrocolloid Marine Science's (HKG:1084) recent performance, when its stock has declined 17% over the past three months. However, the company's fundamentals look pretty decent, and long-term financials are usually aligned with future market price movements. Particularly, we will be paying attention to Green Future Food Hydrocolloid Marine Science's ROE today.
Return on equity or ROE is an important factor to be considered by a shareholder because it tells them how effectively their capital is being reinvested. In short, ROE shows the profit each dollar generates with respect to its shareholder investments.
Check out our latest analysis for Green Future Food Hydrocolloid Marine Science
How To Calculate Return On Equity?
The formula for return on equity is:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
So, based on the above formula, the ROE for Green Future Food Hydrocolloid Marine Science is:
12% = HK$104m ÷ HK$862m (Based on the trailing twelve months to December 2021).
The 'return' is the profit over the last twelve months. That means that for every HK$1 worth of shareholders' equity, the company generated HK$0.12 in profit.
Why Is ROE Important For Earnings Growth?
So far, we've learned that ROE is a measure of a company's profitability. Depending on how much of these profits the company reinvests or "retains", and how effectively it does so, we are then able to assess a company's earnings growth potential. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don't share these attributes.
Green Future Food Hydrocolloid Marine Science's Earnings Growth And 12% ROE
To start with, Green Future Food Hydrocolloid Marine Science's ROE looks acceptable. Further, the company's ROE is similar to the industry average of 12%. Green Future Food Hydrocolloid Marine Science's decent returns aren't reflected in Green Future Food Hydrocolloid Marine Science'smediocre five year net income growth average of 4.0%. We reckon that a low growth, when returns are moderate could be the result of certain circumstances like low earnings retention or poor allocation of capital.
Next, on comparing with the industry net income growth, we found that Green Future Food Hydrocolloid Marine Science's reported growth was lower than the industry growth of 18% in the same period, which is not something we like to see.
SEHK:1084 Past Earnings Growth September 1st 2022
The basis for attaching value to a company is, to a great extent, tied to its earnings growth. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. By doing so, they will have an idea if the stock is headed into clear blue waters or if swampy waters await. Is Green Future Food Hydrocolloid Marine Science fairly valued compared to other companies? These 3 valuation measures might help you decide.
Is Green Future Food Hydrocolloid Marine Science Efficiently Re-investing Its Profits?
While Green Future Food Hydrocolloid Marine Science has a decent three-year median payout ratio of 49% (or a retention ratio of 51%), it has seen very little growth in earnings. So there could be some other explanation in that regard. For instance, the company's business may be deteriorating.
In addition, Green Future Food Hydrocolloid Marine Science only recently started paying a dividend so the management must have decided the shareholders prefer dividends over earnings growth.
Conclusion
In total, it does look like Green Future Food Hydrocolloid Marine Science has some positive aspects to its business. However, given the high ROE and high profit retention, we would expect the company to be delivering strong earnings growth, but that isn't the case here. This suggests that there might be some external threat to the business, that's hampering its growth. While we won't completely dismiss the company, what we would do, is try to ascertain how risky the business is to make a more informed decision around the company. To know the 3 risks we have identified for Green Future Food Hydrocolloid Marine Science visit our risks dashboard for free.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
在看到绿色未来食品水胶海洋科学公司(HKG:1084)最近的表现后,很难感到兴奋,其股价在过去三个月里下跌了17%。然而,该公司的基本面看起来相当不错,长期财务状况通常与未来的市场价格走势保持一致。今天,我们将特别关注绿色未来食品水胶海洋科学的净资产收益率。
股本回报率或净资产收益率是股东要考虑的一个重要因素,因为它告诉他们他们的资本再投资的效率。简而言之,净资产收益率显示了每一美元相对于其股东投资产生的利润。
查看我们对绿色未来食品水胶海洋科学的最新分析
如何计算股本回报率?
这个股本回报率公式是:
股本回报率=(持续经营的)净利润?股东权益
因此,根据上述公式,绿色未来食品水胶海洋科学的净资产收益率为:
12%=1.04亿港元×8.62亿港元(根据截至2021年12月的过去12个月计算)。
“收益”是过去12个月的利润。这意味着,每1港元的股东权益,该公司就会产生0.12港元的利润。
为什么净资产收益率对收益增长很重要?
到目前为止,我们了解到净资产收益率是衡量一家公司盈利能力的指标。根据公司将这些利润再投资或“保留”多少,以及这样做的效率如何,我们就能够评估一家公司的收益增长潜力。一般来说,在其他条件相同的情况下,股本回报率和利润留存较高的公司比不具备这些特征的公司有更高的增长率。
绿色未来食品水胶海洋科学的盈利增长和12%的净资产收益率
首先,绿色未来食品水胶海洋科学公司的净资产收益率看起来是可以接受的。此外,该公司的净资产收益率(ROE)接近12%的行业平均水平。绿色未来食品水胶海洋科学的可观回报并没有反映在绿色未来食品水胶海洋科学平平的五年净收入增长4.0%的平均水平上。我们认为,当回报适中时,低增长可能是某些情况的结果,比如低收益留存或资本配置不当。
接下来,对比行业净收入增长,我们发现绿未来食品水胶海洋科学的报告增长低于同期行业18%的增长,这是我们不愿意看到的。
联交所:1084过去盈利增长2022年9月1日
赋予一家公司价值的基础在很大程度上与其盈利增长挂钩。投资者下一步需要确定的是,预期的收益增长是否已经计入了股价。通过这样做,他们将知道股票是将进入清澈的蓝色水域,还是等待沼泽水域。与其他公司相比,绿色未来食品水胶海洋科学公司是否得到了公平的评价?这3个估值指标可能会帮助你做出决定。
绿色未来食品水胶海洋科学是否有效地将其利润再投资?
虽然绿色未来食品水胶海洋科学公司的三年中值派息率为49%(或留存率为51%),但它的收益增长很小。因此,在这方面可能有一些其他的解释。例如,该公司的业务可能正在恶化。
此外,绿色未来食品水胶海洋科学公司最近才开始分红,因此管理层肯定已经决定,股东更喜欢分红,而不是收益增长。
结论
总体而言,它看起来确实像绿色未来食品水胶体海洋科学公司的业务有一些积极的方面。然而,考虑到高净资产收益率和高利润保留率,我们预计该公司将实现强劲的收益增长,但这里的情况并非如此。这表明,该业务可能面临一些外部威胁,这正在阻碍其增长。虽然我们不会完全解雇这家公司,但我们要做的是努力确定这项业务在公司周围做出更明智的决定的风险有多大。要了解我们为绿色未来食品水胶海洋科学确定的3个风险,请免费访问我们的风险仪表板。
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本文由Simply Wall St.撰写,具有概括性。我们仅使用不偏不倚的方法提供基于历史数据和分析师预测的评论,我们的文章并不打算作为财务建议。它不构成买卖任何股票的建议,也没有考虑你的目标或你的财务状况。我们的目标是为您带来由基本面数据驱动的长期重点分析。请注意,我们的分析可能不会将最新的对价格敏感的公司公告或定性材料考虑在内。Simply Wall St.对上述任何一只股票都没有持仓。