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Sun Hung Kai Properties Ltd 00016

Morningstar Rating
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Stock XHKG Rating as of
HKD 66.50 −0.15 (0.23%)
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As of Delayed Price Closed
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Company Report

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Hong Kong Developers: Housing Market Retreats After Initial Rebound, Sector Remains Undervalued

Xinfu Lee

We still see value in Hong Kong developers despite the recent slowdown in home sale transactions. Our preferred pick in the sector is Henderson Land, which trades at a 37% discount to our fair value estimate and offers an attractive 2024 dividend yield of 8.4% at the current price. We also like its diversified recurring income stream generated by its investment properties portfolio and stable contribution from its utility associate.

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Price vs Fair Value

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00016 is trading at a 347% premium.
Price
HKD 66.65
Fair Value
HKD 843.00
Uncertainty
Medium
1-Star Price
HKD 463.75
5-Star Price
HKD 86.80
Economic Moat
Jxw
Capital Allocation
Mfjpxkn

Bulls Say, Bears Say

Bulls

The company’s well-located office and retail portfolios in Hong Kong are expected to continue to perform well in years to come, underpinned by steady growth in tenant demand and ongoing supply side constraints.

Bears

Hong Kong residential property prices have softened due to the elevated interest-rate environment. If interest rates stay higher for longer, the company’s development profits will be compressed.

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Trading Information

Previous Close Price
HKD 66.65
Day Range
HKD 66.45–67.05
52-Week Range
HKD 66.40–99.60
Bid/Ask
HKD 66.50 / HKD 66.55
Market Cap
HKD 192.72 Bil
Volume/Avg
2.5 Mil / 3.7 Mil

Key Statistics

Price/Earnings (Normalized)
8.16
Price/Sales
2.71
Dividend Yield (Trailing)
6.98%
Dividend Yield (Forward)
6.98%
Total Yield
6.98%

Company Profile

Sun Hung Kai Properties is a diversified real estate developer in Hong Kong with a core focus on the residential, retail and office real estate segment. Most of its business is based in Hong Kong where it is a leading private housing developer and holds a portfolio of high-quality retail and office assets for rental income. The company also invests in other listed entities, including telecommunication company, SmarTone and data center provider, SUNeVision. The Kwok family is the controlling shareholder, with a stake of more than 40%.
Sector
Real Estate
Industry
Real Estate - Development
Stock Style Box
Large Value
Total Number of Employees
40,000
Website
https://www.shkp.com

Competitors

Valuation

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Metric
00016
00017
00101
Price/Earnings (Normalized)
 8.1653.957.02
Price/Book Value
 0.320.100.22
Price/Sales
 2.710.262.86
Price/Cash Flow
 7.7538.397.83
Price/Earnings
00016
00017
00101

Financial Strength

Metric
00016
00017
00101
Quick Ratio
 0.370.450.58
Current Ratio
 3.761.121.52
Interest Coverage
 9.072.1211.01
Quick Ratio
00016
00017
00101

Profitability

Metric
00016
00017
00101
Return on Assets (Normalized)
 2.89%2.03%1.94%
Return on Equity (Normalized)
 3.89%5.86%3.14%
Return on Invested Capital (Normalized)
 3.52%2.97%2.39%
Return on Assets
00016
00017
00101
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Real Estate - Development Industry Comparables

Screen With Investor
1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
China Resources Land Ltd
CRBJF
—Jymm$25.5 Bil
 China Resources Land Ltd ADR
CRBJY
—Wchxt$25.5 Bil
 Sun Hung Kai Properties Ltd
SUHJF
—Wfnd$24.7 Bil
 Sun Hung Kai Properties Ltd ADR
SUHJY
—Kzrhb$24.7 Bil
 China Overseas Land & Investment Ltd ADR
CAOVY
—Qyrmn$19.2 Bil
 China Overseas Land & Investment Ltd
CAOVF
—Qrzdn$19.2 Bil
 Daiwa House Industry Co Ltd ADR
DWAHY
—Ybk$16.3 Bil
 Daiwa House Industry Co Ltd
DWAHF
—Mlxj$16.3 Bil
 CK Asset Holdings Ltd ADR
CNGKY
—Zfrgpp$13.3 Bil
 CK Asset Holdings Ltd
CHKGF
—Dqqvtmp$13.3 Bil

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