Fact based stock research
Chong Hong Construction (TSEC:5534)

TW0005534002

How to read the ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Chong Hong Construction stock research in summary

chonghong.com.tw

ANALYSIS: With an Obermatt Combined Rank of 100 (better than 100% compared with investment alternatives), Chong Hong Construction (Real Estate: Diversified Operations, Taiwan) shares have much better financial characteristics than comparable stocks. Shares of Chong Hong Construction are a good value (attractively priced) with a consolidated Value Rank of 59 (better than 59% of alternatives), show above-average growth (Growth Rank of 97), and are safely financed (Safety Rank of 90), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 100, is a strong buy recommendation based on Chong Hong Construction's financial characteristics. As the company Chong Hong Construction's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 59), above-average growth (Obermatt Growth Rank of 97), and indicate that the company is safely financed (Obermatt Safety Rank of 90), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of Chong Hong Construction. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	59
Growth Rank	97
Safety Rank	90
Combined Rank	100

Country	Taiwan
Industry	Real Estate: Diversified Operations
Index	FTSE Taiwan
Size class	Small

18-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Chong Hong Construction

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	63	57	55	59
GROWTH
GROWTH	26	5	43	97
SAFETY
SAFETY	72	98	96	90
SENTIMENT
SENTIMENT	n/a	100	52	^new
360° VIEW
360° VIEW	n/a	80	79	^new

Most recent update of the stock research: 18-Apr-2024. Financial reporting date used for calculating ranks: 30-Jun-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better Chong Hong Construction is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	63	57	55	59
GROWTH
GROWTH	26	5	43	97
SAFETY
SAFETY	72	98	96	90
COMBINED
COMBINED	51	55	78	100

Last update of combined financial performance: 18-Apr-2024. Stock analysis on combined financial performance: The higher the rank of Chong Hong Construction the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 59 (better than 59% compared with alternatives), Chong Hong Construction shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Chong Hong Construction. Price-to-Profit (also referred to as price-earnings, P/E) is 76 which means that the stock price compared with what market professionals expect for future profits is lower than for 76% of comparable companies, indicating a good value concerning Chong Hong Construction's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 20, which means that the stock price is lower as regards to invested capital than for 20% of comparable investments. On the other hand, Price-to-Sales is less favorable than 52% of alternatives (only 48% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 17% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 59, is a buy recommendation based on Chong Hong Construction's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	30	35	38	48
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	61	41	66	76
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	38	42	28	20
DIVIDEND YIELD
DIVIDEND YIELD	85	100	94	83
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	63	57	55	59

Last update of Value Rank: 18-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Chong Hong Construction; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 97 (better than 97% compared with alternatives) for 2024, Chong Hong Construction shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Chong Hong Construction. Sales Growth has a rank of 67 which means that currently, professionals expect the company to grow more than 67% of its competitors. Capital Growth is also above 39% of competitors with a rank of 95, and Stock Returns with the rank of 73 is also an outperformance. Only Profit Growth is low with a rank of 39 which means that currently, professionals expect the company to grow its profits less than 61% of its competitors. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 97, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Chong Hong Construction is a good growth stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	23	4	100	67
PROFIT GROWTH
PROFIT GROWTH	95	1	6	39
CAPITAL GROWTH
CAPITAL GROWTH	n/a	63	1	95
STOCK RETURNS
STOCK RETURNS	67	23	63	73
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	26	5	43	97

Last update of Growth Rank: 18-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Chong Hong Construction.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 90 (better than 90% compared with alternatives) for 2024, the company Chong Hong Construction has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Chong Hong Construction is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Chong Hong Construction. Refinancing is at 71, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 71% of its competitors. Liquidity is also good at 96, meaning the company generates more profit to service its debt than 96% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 32, which means the company has an above-average debt-to-equity ratio. It has more debt than 68% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 90 (better than 90% compared with alternatives), Chong Hong Construction has a financing structure that is significantly safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Chong Hong Construction could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with Chong Hong Construction and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	48	54	32	32
REFINANCING
REFINANCING	69	77	83	71
LIQUIDITY
LIQUIDITY	56	100	98	96
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	72	98	96	90

Last update of Safety Rank: 18-Apr-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Chong Hong Construction and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	100	91	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	99	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	90	31	^new
MARKET PULSE
MARKET PULSE	n/a	67	35	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	100	52	^new

Last update of Sentiment Rank: 18-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Chong Hong Construction.
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