I purchased shares of Prosperous Industrial (1731.HK) at an average price of HK$0.752, driven by its strong earnings growth and attractive valuation metrics.
Prosperous Industrial is an investment holding company
primarily engaged in the manufacturing and sale of sports bags, general bags,
and luggage. Its products are sold across the North American, Asian, and
European markets.
The stock closed on 18 July at HK$0.82, and its key investment highlights include:
P/E (TTM):
3.96x
Dividend Yield:
8.54%
ROE: 18.6%
Earnings Growth: Turned around in FY2020 and has since grown
at a CAGR of 77.8% over the past four years
If the market begins to recognise the company’s fundamentals
in the coming 6 months, we could see a re-rating in its valuation. A more
reasonable P/E of 10x would imply a target price of HK$2.07, representing a
152% upside—or a 2.5-bagger from current levels.
Superphang
http://superphang.blogspot.sg
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