Guoco Group (0053) AI Stock Analysis

• Market Cap: HK$24.96B
• Dividend Yield: 4.3%
• Average Volume (3M): 5.61K
• Price to Earnings (P/E): 6.2
• Beta (1Y): 0.26
• Revenue Growth: -1.54%
• EPS Growth: 9.96%
• Country: HK
• Employees: 10,900
• Sector: Industrials
• Sector Strength: 72
• Industry: Conglomerates
• EPS (TTM): N/A
• Shares Outstanding: 329,051,360
• 10 Day Avg. Volume: 6,400
• 30 Day Avg. Volume: 5,610
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$85.00
• Price Target Upside: 10.75% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 80 Outperform
• Price Target: HK$85.00 ▲(10.75% Upside)

Guoco Group's strong financial performance and attractive valuation are the primary drivers of its high stock score. The company's robust revenue growth, profitability, and efficient cash management underpin its financial stability, while its low P/E ratio and high dividend yield make it appealing to value investors. Technical indicators suggest strong momentum, though caution is advised due to potential overbought conditions.

Guoco Group Business Overview & Revenue Model

Company Description

Guoco Group Limited, an investment holding company, engages in the principal investment, property investment and development, hospitality and leisure, and financial service businesses. The company's Principal Investment segment offers debt, equity, and direct investments, as well as treasury operations with trading and strategic investments in global capital markets. Its Property Development and Investment segment develops residential and commercial properties, as well as holds properties for rental income in Singapore, China, Malaysia, Vietnam, and Hong Kong. The company's Hospitality and Leisure Business segment owns, leases, and manages hotels; and operates gaming and leisure businesses in the United Kingdom, Spain, and Belgium. This segment owns and operates hotels under Amba, Guoman, Thistle, and Thistle Express brands, as well as operates Hard Rock Hotel London under a third party brand. It offers Mecca, a bingo operator in Great Britain with 82 venues and a digital channel, www.meccabingo.com that provides a selection of games from bingo to slot machines; Grosvenor Casinos, a casino operator with 52 casinos in Great Britain and one unbranded casino in Belgium, as well as its digital channel, www.grosvenorcasinos.com; and Enracha, which offers a range of popular games and sports betting through its 9 venues in Spain and its digital channels www.enracha.es, www.yobingo.es, and www.yocasino.es. Its Financial Services segment provides commercial and consumer, Islamic, and investment banking services; and life and general insurance, Takaful insurance, fund management and unit trust, corporate advisory, and stock broking services. The company also offers royalty entitlement of Bass Strait's oil and gas production, as well as manufactures, markets, and distributes health products. The company is based in Central, Hong Kong. Guoco Group Limited is a subsidiary of GuoLine Overseas Limited.

How the Company Makes Money

Guoco Group makes money through its diversified business operations. Its property development and investment segment generates revenue from the sale and leasing of high-quality residential, commercial, and industrial properties. The hospitality and leisure sector contributes to earnings through its chain of hotels and resorts, offering accommodations and services to travelers. In financial services, Guoco's earnings come from its banking, insurance, and investment management businesses, which provide a range of financial products and services. Additionally, the company's oil and gas segment generates income from its exploration, production, and sale of energy resources. Guoco Group's revenue is further enhanced by strategic partnerships and joint ventures that expand its market reach and operational capabilities, as well as by its investment holdings in listed and unlisted securities that provide capital gains and dividends.

Guoco Group Financial Statement Overview

Summary

Guoco Group displays robust financial health with strong revenue growth and profitability. The income statement reveals a healthy gross profit margin of 37.05% and a net profit margin of 15.90%. The balance sheet shows a solid equity position with manageable leverage, and cash flow statements highlight efficient cash generation and growth in free cash flow.

Income Statement

Guoco Group shows a strong upward trend in revenue with a significant growth rate of approximately 15.86% from 2023 to 2024. The gross profit margin is healthy at 37.05%, and the net profit margin is robust at 15.90%. EBIT margin stands at 13.05%, while EBITDA margin is impressive at 33.58%, indicating efficient cost management and profitability. These metrics highlight the company's strong profitability and effective revenue growth strategy.

Balance Sheet

The company maintains a solid equity position with an equity ratio of 45.29%, suggesting a well-capitalized structure. The debt-to-equity ratio is moderate at 0.74, implying manageable leverage. Return on equity (ROE) is strong at 5.84%, showcasing effective utilization of shareholders' equity to generate profit. Overall, the balance sheet reflects financial stability with a balanced approach to debt and equity.

Cash Flow

Guoco Group exhibits a strong operating cash flow to net income ratio of 2.22, indicating efficient cash generation relative to its net income. Free cash flow has grown by 11.06% from 2023 to 2024, demonstrating the company's ability to generate additional cash after capital expenditures. The free cash flow to net income ratio of 2.01 further highlights the company's strong cash flow management and profitability.

Breakdown	TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	2.92B	2.88B	2.49B	1.90B	1.32B	1.89B
Gross Profit	1.09B	1.07B	909.36M	750.01M	351.64M	779.98M
EBITDA	624.14M	968.73M	376.82M	516.19M	630.13M	332.01M
Net Income	503.50M	458.58M	438.97M	249.86M	322.10M	-112.61M
Balance Sheet
Total Assets	17.10B	17.35B	132.62B	130.28B	131.75B	127.29B
Cash, Cash Equivalents and Short-Term Investments	3.12B	3.14B	21.03B	17.98B	19.23B	22.02B
Total Debt	5.41B	5.82B	44.54B	45.23B	45.35B	45.06B
Total Liabilities	6.77B	7.23B	55.29B	54.93B	54.76B	53.27B
Stockholders Equity	8.02B	7.86B	59.34B	57.73B	59.78B	56.12B
Cash Flow
Free Cash Flow	1.31B	921.75M	829.90M	409.37M	437.45M	-134.00M
Operating Cash Flow	1.39B	1.02B	892.38M	451.67M	458.36M	-75.36M
Investing Cash Flow	-83.70M	-264.70M	-384.86M	-293.91M	-211.10M	41.60M
Financing Cash Flow	-1.12B	-451.27M	-613.06M	-98.61M	-567.86M	47.39M

Guoco Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 76.75
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0053, the sentiment is Positive. The current price of 76.75 is above the 20-day moving average (MA) of 75.65, above the 50-day MA of 74.46, and above the 200-day MA of 68.86, indicating a bullish trend. The MACD of 0.73 indicates Negative momentum. The RSI at 63.39 is Neutral, neither overbought nor oversold. The STOCH value of 74.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0053.

Guoco Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0053	80 Outperform	HK$24.96B	6.21	6.40%	4.30%	-1.54%	9.96%
0363	75 Outperform	16.03B	6.05	5.90%	6.38%	-7.44%	-18.48%
0392	75 Outperform	42.57B	7.34	0.00%	4.79%	0.00%	0.00%
0001	71 Outperform	193.61B	25.03	3.20%	4.40%	1.93%	-65.62%
0148	69 Neutral	30.61B	11.32	2.73%	5.07%	6.95%	24.07%
0656	57 Neutral	46.03B	-9.60	-3.68%	0.35%	-8.93%	-698.78%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Guoco Group Corporate Events

Guoco Group Renews Investment Management Agreements

Guoco Group has announced the renewal of its investment management and advisory agreements with AFAL and GMC, extending the terms from August 2025 to June 2028. These agreements, which involve GAPL providing fund management and advisory services, are considered continuing connected transactions under Hong Kong’s Listing Rules. The renewal aligns the duration of both agreements to streamline administrative processes, with service fees including management and performance fees based on the portfolio’s net asset value and excess returns.

Rank Group Plc Reports Strong Year-End Performance and Prepares for Casino Expansion

The Rank Group Plc, a subsidiary of Guoco Group Limited, has reported a strong trading performance for the year ending 30 June 2025, with a like-for-like net gaming revenue increase of 11% to approximately £795 million. The company anticipates a full-year underlying operating profit of at least £63 million, surpassing expectations despite facing regulatory challenges. The recent legalization of land-based casino reforms is expected to further enhance Rank’s operations, as they plan to expand gaming machine offerings across their Grosvenor estate in England and Wales.

Guoco Group’s Rank Subsidiary Reports Strong Revenue Growth Amid Regulatory Changes

Guoco Group Limited announced a trading update for its subsidiary, The Rank Group Plc, highlighting an 11% growth in like-for-like Net Gaming Revenue to approximately £795 million for the year ending 30 June 2025. The Rank Group expects to report a full-year underlying operating profit of at least £63 million, surpassing expectations despite facing cost and regulatory challenges. The company is poised for further growth with upcoming land-based casino reforms in England and Wales, which will allow for the expansion of gaming machines across its Grosvenor estate.

Guoco Group Enhances Audit and Risk Management Oversight

Guoco Group Limited has revised the terms of reference for its Board Audit and Risk Management Committee, effective from July 1, 2025. The changes aim to enhance the committee’s oversight on risk management and internal controls, ensuring compliance with ethical standards and legal requirements. This restructuring may improve the company’s governance and operational efficiency, potentially impacting stakeholders positively.

Guoco Group Updates Board Nomination Committee Terms

Guoco Group Limited has revised the terms of reference for its Board Nomination Committee, effective from July 1, 2025. The Committee is tasked with formulating policies for the nomination of directors, board diversity, and workforce diversity, as well as reviewing the board’s structure and composition. This move is aimed at enhancing the company’s governance by ensuring a diverse and skilled board that aligns with the company’s corporate strategy.