The Hong Kong market has seen a notable uptick, with the Hang Seng Index gaining 5.12% recently, driven by a broader positive sentiment following the U.S. Federal Reserve's rate cut. This favorable environment presents an opportune moment to explore undervalued small-cap stocks that have shown potential through insider buying. In this context, identifying stocks with strong fundamentals and insider confidence can be particularly rewarding for investors looking to capitalize on current market conditions.
Top 5 Undervalued Small Caps With Insider Buying In Hong Kong
| Name | PE | PS | Discount to Fair Value | Value Rating |
|---|---|---|---|---|
| Shanghai Chicmax Cosmetic | 15.3x | 1.9x | -125.19% | ★★★★☆☆ |
| EVA Precision Industrial Holdings | 4.5x | 0.2x | 83.78% | ★★★★☆☆ |
| Ferretti | 10.2x | 0.7x | 49.90% | ★★★★☆☆ |
| Meilleure Health International Industry Group | 26.3x | 9.7x | 20.53% | ★★★☆☆☆ |
| Analogue Holdings | 13.8x | 0.2x | 39.50% | ★★★☆☆☆ |
| Skyworth Group | 5.1x | 0.1x | -160.23% | ★★★☆☆☆ |
| Lee & Man Paper Manufacturing | 6.1x | 0.4x | -25.25% | ★★★☆☆☆ |
Let's uncover some gems from our specialized screener.
Shanghai Chicmax Cosmetic (SEHK:2145)
Simply Wall St Value Rating: ★★★★☆☆
Overview: Shanghai Chicmax Cosmetic is engaged in the manufacture and sale of cosmetic products, with a market cap of CN¥7.45 billion.
Operations: The company generates revenue primarily from the manufacture and sale of cosmetic products, with a notable gross profit margin reaching 74.96% in the latest period. Operating expenses include significant allocations to sales and marketing, R&D, and general administrative costs.
PE: 15.3x
Shanghai Chicmax Cosmetic, a small cap in Hong Kong, has shown significant growth with first-half 2024 sales at CNY 3.5 billion, up from CNY 1.6 billion last year. Net income surged to CNY 401 million from CNY 101 million. The company proposed a dividend of RMB 0.75 per share for the period ending June 30, with insider confidence evident through recent share purchases in August and September. Amendments to bylaws will be discussed on September 30, signaling potential strategic shifts ahead.
- Unlock comprehensive insights into our analysis of Shanghai Chicmax Cosmetic stock in this valuation report.
Understand Shanghai Chicmax Cosmetic's track record by examining our Past report.
Lee & Man Paper Manufacturing (SEHK:2314)
Simply Wall St Value Rating: ★★★☆☆☆
Overview: Lee & Man Paper Manufacturing operates in the production of pulp, tissue paper, and packaging paper with a market capitalization of HK$22.40 billion.
Operations: Lee & Man Paper Manufacturing generates revenue primarily from packaging paper and tissue paper, with packaging paper contributing the largest share. The company has experienced fluctuations in its gross profit margin, which reached 29.08% in December 2017 but decreased to 12.49% by June 2024. Operating expenses include significant allocations for sales and marketing as well as general and administrative costs.
PE: 6.1x
Lee & Man Paper Manufacturing, a smaller player in Hong Kong's market, has shown promising signs of being undervalued. Recently, they declared an interim dividend of HK$0.062 per share for the six months ended June 30, 2024. Their earnings report highlighted sales of HK$12.51 billion and net income of HK$805.69 million, significantly up from the previous year’s figures. Notably, insider confidence is evident with Ho Chung Lee purchasing 483,000 shares worth over HK$1 million in recent transactions.
Skyworth Group (SEHK:751)
Simply Wall St Value Rating: ★★★☆☆☆
Overview: Skyworth Group is a diversified technology company engaged in smart household appliances, smart systems technology, modern services, and new energy businesses with a market cap of approximately CN¥9.10 billion.
Operations: Skyworth Group generates revenue primarily from Smart Household Appliances (CN¥32.51 billion), New Energy Business (CN¥20.21 billion), Smart Systems Technology Business (CN¥9.84 billion), and Modern Services and Others (CN¥5.80 billion). The company has seen fluctuations in its gross profit margin, with the most recent figure at 14.36% as of June 30, 2024, down from a high of 21.93% on March 31, 2016.
PE: 5.1x
Skyworth Group, a small cap in Hong Kong, recently reported half-year earnings with sales of CNY 265 million and net income rising to CNY 384 million from CNY 302 million. CEO Chi Shi's insider confidence is evident with their purchase of over 2.1 million shares for approximately A$6.3 million, reflecting a significant boost in ownership by 16%. Skyworth's strategic expansion into the Russian market aims to leverage its advanced technology and strong product lineup, positioning it well for future growth.
- Click here to discover the nuances of Skyworth Group with our detailed analytical valuation report.
Assess Skyworth Group's past performance with our detailed historical performance reports.
Turning Ideas Into Actions
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Ready For A Different Approach?
- Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
- Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.
- Find companies with promising cash flow potential yet trading below their fair value.
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.
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