SMIT Holdings (2239) AI Stock Analysis

• Market Cap: HK$266.44M
• Dividend Yield: 1.22%
• Average Volume (3M): 63.13K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.59
• Revenue Growth: -38.02%
• EPS Growth: -33.66%
• Country: HK
• Employees: 179
• Sector: Technology
• Sector Strength: 88
• Industry: Security & Protection Services
• EPS (TTM): N/A
• Shares Outstanding: 324,931,980
• 10 Day Avg. Volume: 74,200
• 30 Day Avg. Volume: 63,133
• 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: 21.95% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 42 Neutral
• Price Target: HK$1.00 ▲(21.95% Upside)

The overall stock score is primarily impacted by significant financial challenges, including declining revenues and negative cash flows. Technical analysis indicates bearish momentum, and valuation metrics are unattractive due to negative earnings. These factors collectively suggest a cautious outlook for the stock.

SMIT Holdings Business Overview & Revenue Model

Company Description

SMIT Holdings Limited designs, develops, and markets security devices for pay TV broadcasting access and mobile point-of-sale payment (mPOS) systems worldwide. It operates through CAM, Rapid Verification Systems and Software, Cloud Services, and IC Solutions segments. The CAM and mPOS devices enable secure distribution and delivery of digital content to television and secure mobile payment transaction. It also develops and sells rapid hardware-based verification systems and software; researches, develops, and sells IC products and related design services; and provides cloud services, including cloud platform services and related support services. In addition, the company is involved in the development and application of full process electronic design automation systems for chip design. SMIT Holdings Limited was founded in 2002 and is headquartered in Sha Tin, Hong Kong.

How the Company Makes Money

SMIT Holdings generates revenue through the design, manufacturing, and sale of digital TV conditional access modules (CAMs) and mobile point-of-sale (mPOS) devices. The CAM segment primarily earns income by selling its secure access solutions to broadcasters, satellite operators, and network providers, enabling them to offer encrypted content to subscribers. The mPOS segment contributes to revenue by providing hardware and related services that support electronic payment transactions, targeting small and medium-sized enterprises and financial institutions. The company's earnings are further supported by strategic partnerships and collaborations with key players in the broadcasting and financial technology industries, enhancing product distribution and market reach.

SMIT Holdings Financial Statement Overview

Summary

SMIT Holdings faces significant financial challenges, with declining revenues, persistent losses, and negative cash flows. The company is highly leveraged, which adds financial risk. Although the equity position is relatively stable, the negative profitability and cash flow trends are concerning.

Income Statement

The company has experienced a significant decline in revenue over the years, with a negative revenue growth rate and decreasing gross profit margins. Net income has been negative, indicating persistent losses, and both EBIT and EBITDA margins are negative, signaling operational inefficiencies. These factors contribute to a lower score for the income statement.

Balance Sheet

The balance sheet shows a relatively stable equity position but concerns arise from a high debt-to-equity ratio in recent years, indicating increased leverage. The equity ratio remains strong, but the return on equity has been negative due to consistent net losses. The balance sheet reflects moderate stability with potential risks from leverage.

Cash Flow

Cash flow analysis reveals negative operating cash flow in recent years, highlighting cash constraints. The free cash flow has also been negative, suggesting challenges in generating cash after capital expenditures. The operating cash flow to net income ratio is unfavorable due to negative net income, resulting in a low cash flow score.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	13.98M	22.47M	29.41M	36.25M	37.79M
Gross Profit	7.53M	8.38M	12.14M	17.13M	13.31M
EBITDA	-869.35K	-9.40M	83.26M	6.42M	-1.56M
Net Income	-38.46M	-13.90M	57.19M	9.84M	-3.43M
Balance Sheet
Total Assets	151.20M	195.94M	247.24M	232.03M	232.53M
Cash, Cash Equivalents and Short-Term Investments	19.07M	20.57M	48.23M	18.80M	46.48M
Total Debt	1.33M	868.45K	18.59M	30.96M	38.85M
Total Liabilities	20.61M	24.44M	59.65M	93.65M	106.22M
Stockholders Equity	129.12M	169.59M	185.39M	135.95M	123.97M
Cash Flow
Free Cash Flow	-762.87K	-13.01M	20.46M	-9.01M	-48.30M
Operating Cash Flow	-473.12K	-12.55M	26.74M	9.52M	-6.51M
Investing Cash Flow	372.85K	2.62M	12.61M	-26.29M	-55.81M
Financing Cash Flow	-1.36M	-17.08M	-9.67M	-11.34M	35.68M

SMIT Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.82
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2239, the sentiment is Negative. The current price of 0.82 is below the 20-day moving average (MA) of 0.90, below the 50-day MA of 0.96, and below the 200-day MA of 0.92, indicating a bearish trend. The MACD of -0.03 indicates Positive momentum. The RSI at 37.11 is Neutral, neither overbought nor oversold. The STOCH value of 29.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:2239.

SMIT Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2885	56 Neutral	296.00M	-75.51	―	7.30%	-24.55%	-30.67%
8066	54 Neutral	379.21M	7.55	1.11%	―	99.25%	82000.00%
3882	44 Neutral	867.39M	-14.03	-71.32%	―	-8.19%	7.82%
0487	44 Neutral	655.22M	6.89	―	―	-27.48%	―
2239	42 Neutral	HK$266.44M	―	-29.27%	1.22%	-38.02%	-33.66%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

SMIT Holdings Corporate Events

SMIT Holdings Announces Major Equity Sale in S2C Shanghai

SMIT Holdings Limited has announced a major transaction involving the sale of a 16% equity interest in its subsidiary, S2C Shanghai, to an investor for RMB211,665,760. This transaction is classified as a major transaction under the Listing Rules and requires shareholders’ approval, which the company plans to obtain through written consent from its major shareholders, Ever Expert and Mr. Huang. The transaction is subject to certain conditions and may not proceed, urging shareholders and potential investors to exercise caution.

The most recent analyst rating on (HK:2239) stock is a Hold with a HK$1.00 price target. To see the full list of analyst forecasts on SMIT Holdings stock, see the HK:2239 Stock Forecast page.

SMIT Holdings Reports Increased Losses Amid Revenue Decline

SMIT Holdings Limited reported its unaudited financial results for the first half of 2025, showing a decline in revenue to USD 7.07 million from USD 8.66 million in the same period of 2024. The company experienced a significant operating loss of USD 5.85 million, attributed to increased research and development expenses and net losses from investments. Despite a slight improvement in finance income, the overall loss for the period amounted to USD 15.80 million, indicating ongoing financial challenges.

The most recent analyst rating on (HK:2239) stock is a Hold with a HK$1.00 price target. To see the full list of analyst forecasts on SMIT Holdings stock, see the HK:2239 Stock Forecast page.

SMIT Holdings Issues Profit Warning Amid Continued R&D Investments

SMIT Holdings Limited has issued a profit warning, indicating an expected loss of up to US$16 million for the first half of 2025, similar to the previous year’s loss. The losses are primarily due to non-cash items, including the company’s share of losses from associated companies investing in R&D and a re-valuation loss of an investee company. These factors do not impact the company’s cash flow management, but stakeholders are advised to exercise caution.

SMIT Holdings Announces Upcoming Board Meeting for Interim Results

SMIT Holdings Limited has announced that its board of directors will meet on August 22, 2025, to review and approve the interim results for the first half of the year ending June 30, 2025. The meeting will also consider the possibility of declaring an interim dividend. This announcement indicates the company’s ongoing commitment to transparency and shareholder engagement, potentially impacting investor confidence and market perception.

SMIT Holdings Enhances Governance with New Nomination Committee

SMIT Holdings Limited has established a Nomination Committee to enhance its corporate governance framework. The committee is tasked with reviewing the board’s structure, identifying qualified candidates for board positions, and ensuring diversity and independence among directors. This move is aimed at aligning the board’s composition with the company’s strategic goals and improving overall board performance.