The average target price of 300223.SZ is 68 and suggests 1% upside potential. Usually, this means a HOLD recommendation among investment firms. This neutral recommendation suggests no significant price movement, up or down, in the next 12 months. The most optimistic analyst has a target price of 70.0. This translates into 3% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 58.5. This is equivalent to 14% downside potential in the worst case. 

Ingenic Semiconductor Co.,Ltd. designs micro-processors for CPU technologies. Its products are used in biometric identification devices, education electronics, multimedia players, e-books, tablets, etc. The company was founded in 2005 and is headquartered in Beijing, China.

China

Ingenic Semiconductor Co.,Ltd.

Technology

The company pays dividends most of the time. It has paid dividends in almost every one of the past ten years. Dividend per share (DPS) has grown yearly, and there is a clear trend. In the past 12 months, the dividend yield has barely been above zero and was substantially below that of its peers. On average, the company pays dividends annually. 

300223.SZ reported revenue of CNY 4 264mn in the last 12 months, up 1% from FY24. The dynamics of cash flow, as measure by free cash flow (FCF), were rather similar. EPS fell 4% from FY24 to CNY 0.73. Market expects EPS to reach CNY 0.90 in FY25.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Within the past six months, its performance has trailed this peer group's by 7ppts and its growth decelerated by 9ppts in the past month. There is a distinction between the stock's performance and that of its peers from the same country and industry. Over six months its performance trailed that of this peer group by 10ppts and its growth decelerated by 8ppts in the previous month. Given the stock's valuation versus its peers, its total price movement is neither favourable nor unfavourable.

The company has reported modest EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to 10.5% in the last 12 months, a decline from 17.3% in FY23. 

Historically, 300223.SZ has reported good net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled 8.3%, down from 11.9% in FY23. 

Ingenic Semiconductor Co.,Ltd. reported a return on equity (RoE) of 3.0% in the last 12 months, down from 4.7% in FY23. The market consensus projects an RoE of 3.9% in FY24, again behind its peers. 

In the last 12 months, the return on capital employed (RoCE) declined to 2.9%, below the peers. The consensus estimate for FY24 for RoCE is 3.9%, again behind the peers. 

Another important profitability metric, return on assets (RoA), amounted to 2.7% in the last 12 months, a decrease from 4.3% in FY23. The market analysts predict that RoA will be 3.6% in FY24, again weaker than its peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 0.9 in the past several years. This ratio implies a poor shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are close to minimal. In combination with rigorous business standards, shareholder rights are well protected.

300223.SZ boasts high trading liquidity. The average private investor can sell his common position in the stock immediately. Liquidity is usually stable and remains extremely favourable on the days with the lowest activity. However, please consider that under highly turbulent market conditions, the trading volume tends to decrease significantly. 

No other major risks have been identified.

The risk of default is moderate. We note strong debt servicing capacity, adequate interest coverage, solid cash flow generation, and an favourable capital structure, among the positive credit factors. Among the negative credit factors, we point to weak positions in its industry, slow historical revenue growth, negligible return on capital, and poor working capital management.

In highly turbulent market conditions, 300223.SZ is not overly volatile. In other words, the stock will fall less than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be low. 

In normal market circumstances, 300223.SZ is moderately volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will move slightly wider than the index. The stock's losses on its worst days (less than 1-5% of the time) will range from moderate to notable. We would also like to highlight the notable intraday volatility of the instrument. 

From both historical and forecast perspectives, the stock is considerably overpriced compared to similar stocks. In particular, the stock is overpriced on P/E, 'expensive' on EV/EBITDA, overvalued on P/FCF. 

Ingenic Semiconductor Co.,Ltd.

CN¥ 66.52

4

Ingenic Semiconductor Co.,Ltd.

CN¥ 66.52

4

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

CN¥ 66.52

About

About

About

About