Art Group Holdings Ltd. (0565) AI Stock Analysis

• Market Cap: HK$4.38B
• Dividend Yield: N/A
• Average Volume (3M): 11.80M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.66
• Revenue Growth: -9.58%
• EPS Growth: 37.72%
• Country: HK
• Employees: 79
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): 0.01
• Shares Outstanding: 2,688,805,200
• 10 Day Avg. Volume: 18,448,000
• 30 Day Avg. Volume: 11,798,500
• 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$1.00
• Price Target Upside: -38.65% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 44 Neutral
• Price Target: HK$1.00 ▼(-38.65% Downside)

Art Group Holdings Ltd. faces significant financial challenges with declining revenues and negative profitability, leading to a low financial performance score. The technical analysis provides a slightly more positive outlook but remains neutral overall, while the valuation is unfavorable due to the negative P/E ratio and lack of dividend yield. These factors collectively result in a low overall stock score.

Art Group Holdings Ltd. Business Overview & Revenue Model

Company Description

Art Group Holdings Limited, an investment holding company, engages in the provision of rental, management, and operating services for tenants of shopping malls in the People's Republic of China. It operates in two segments, Property Operating and Biotechnology. The company primarily owns and operates two shopping malls. It also manufactures biotechnology products; and trades in agricultural by products. The company was formerly known as Art Textile Technology International Company Limited and changed its name to Art Group Holdings Limited in September 2016. Art Group Holdings Limited is headquartered in Central, Hong Kong. Art Group Holdings Limited is a subsidiary of Fully Chain Limited.

How the Company Makes Money

Art Group Holdings Ltd. generates revenue primarily through the sale and leasing of its developed properties. The company engages in property development projects, which involve acquiring land, developing it into residential, commercial, or industrial properties, and then selling or leasing these properties to generate income. Key revenue streams include the proceeds from property sales and rental income from leased properties. Additionally, the company may engage in strategic partnerships or joint ventures to enhance its development capabilities and expand its market reach, contributing further to its earnings.

Art Group Holdings Ltd. Financial Statement Overview

Summary

Art Group Holdings Ltd. is facing significant financial challenges characterized by declining revenues, negative profitability, and high leverage. The income statement and balance sheet indicate substantial risks with deteriorating business fundamentals. Despite these challenges, the company maintains some positive cash flow, which could provide a basis for recovery if managed carefully.

Income Statement

The company has experienced significant revenue decline over the past year, with a decrease in total revenue from $153.74M to $111.16M, representing a negative growth trend. The gross profit margin has decreased substantially, and the net profit margin is negative, indicating a lack of profitability. The EBIT and EBITDA margins have improved from negative in the previous year but are still not sufficient to offset the losses.

Balance Sheet

The balance sheet reveals high financial leverage with a negative stockholders' equity, resulting in a negative equity ratio, which poses a significant risk. The debt-to-equity ratio is not calculable due to negative equity, and the overall financial stability is weak, with total liabilities exceeding total assets.

Cash Flow

The cash flow analysis shows some positive aspects, such as a stable operating cash flow; however, the free cash flow has decreased compared to the previous period. The operating cash flow to net income ratio is not meaningful due to negative net income, but the free cash flow remains positive, indicating some ability to generate cash despite operational losses.

Breakdown	TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	132.89M	111.16M	153.74M	196.13M	209.43M	173.87M
Gross Profit	112.21M	71.66M	116.22M	158.82M	127.14M	110.27M
EBITDA	31.15M	-213.00M	-90.75M	-56.12M	-181.32M	83.44M
Net Income	-205.91M	-270.79M	-683.45M	-87.50M	-178.32M	-30.66M
Balance Sheet
Total Assets	553.72M	711.11M	1.23B	2.30B	2.85B	3.15B
Cash, Cash Equivalents and Short-Term Investments	35.97M	40.24M	33.15M	21.53M	16.69M	419.10M
Total Debt	10.40M	641.00M	903.63M	1.00B	1.01B	925.12M
Total Liabilities	535.58M	719.05M	964.70M	1.29B	1.34B	1.40B
Stockholders Equity	18.07M	-7.94M	268.44M	1.01B	1.35B	1.40B
Cash Flow
Free Cash Flow	30.41M	50.68M	60.66M	109.31M	-237.18M	12.08M
Operating Cash Flow	30.42M	50.75M	60.87M	117.59M	-226.45M	18.55M
Investing Cash Flow	-14.98M	19.37M	33.51M	116.18M	-372.70M	218.25M
Financing Cash Flow	-42.55M	-56.90M	-80.47M	-225.06M	171.99M	158.06M

Art Group Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.63
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0565, the sentiment is Positive. The current price of 1.63 is above the 20-day moving average (MA) of 1.33, above the 50-day MA of 1.21, and above the 200-day MA of 1.22, indicating a bullish trend. The MACD of 0.13 indicates Negative momentum. The RSI at 71.12 is Negative, neither overbought nor oversold. The STOCH value of 62.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0565.

Art Group Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2156	73 Outperform	4.51B	11.53	18.36%	4.69%	-7.78%	-29.31%
1995	71 Outperform	3.23B	7.02	9.56%	7.66%	2.83%	-6.65%
0029	61 Neutral	3.10B	-57.50	0.00%	0.08%	-23.73%	-101.00%
0410	49 Neutral	2.91B	-27.86	0.00%	―	-8.93%	67.89%
0565	44 Neutral	HK$4.38B	―	-171.73%	―	-9.58%	37.72%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%

Art Group Holdings Ltd. Corporate Events

Art Group Holdings Updates Nomination Committee Terms

Art Group Holdings Limited has revised the terms of reference for its Nomination Committee, which is responsible for overseeing the appointment of directors. The committee will consist of at least three members, with a majority being independent non-executive directors, and will include at least one director of a different gender. This revision aims to enhance governance and ensure diverse representation in the company’s leadership, potentially impacting its strategic direction and stakeholder confidence.

Art Group Holdings Ltd. Introduces New Share Option Scheme

Art Group Holdings Ltd. has announced a supplemental update to its 2024 Annual Report regarding the adoption of a new share option scheme, the 2023 Scheme. This scheme aims to incentivize and reward eligible participants, including directors and employees, for their contributions to the company’s growth. The scheme is designed to align the interests of employees with those of shareholders, promoting sustainable development and long-term performance. The scheme includes specific provisions for maximum entitlement and vesting periods, ensuring that options granted do not exceed certain thresholds and that performance targets may be set by the board.