- HKEX has posted a higher than expected net income in its first quarter earnings. The net income stands at HK$2.97 billion, surpassing the estimated HK$2.81 billion.
- Revenue and other income for the quarter also exceeded predictions. HKEX reported a total of HK$5.20 billion, over the estimated HK$4.97 billion.
- The Ebitda for the first quarter came in at HK$3.71 billion, outstripping the estimated HK$3.6 billion, based on two estimates.
- On a day-to-day basis, HKEX processed an average of 8.55 million derivative contracts traded.
- The analysis of HKEX‘s performance resulted in 26 buy recommendations, 3 hold recommendations and 2 sell recommendations.
HKEX on Smartkarma
Analysis by Daniel Tabbush on Smartkarma indicates a bearish sentiment towards Hong Kong Exchanges (HKEX). Tabbush highlights that a significant portion of HKEX‘s profit came from rising rates on cash deposits, which may reverse. Additionally, lower taxation has artificially inflated profit, with geopolitical risks and economic challenges in Hong Kong and China potentially dampening market interest. Tabbush questions the validity of HKEX‘s 6x price-to-book ratio in light of these concerns.
In a separate report, Brian Freitas also expresses a bearish view on HKEX, suggesting that worsening property transactions in Hong Kong reflect broader issues in the financial center. Freitas points out that Singapore Exchange (SGX) may present a more stable alternative to HKEX, with a stronger earnings outlook and higher return on equity. The analysis compares key financial metrics between the two exchanges, indicating a more favorable stance towards SGX over HKEX.
A look at HKEX Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 3 | |
| Growth | 4 | |
| Resilience | 5 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 3.4 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Based on the Smartkarma Smart Scores, Hong Kong Exchanges & Clearing Limited (HKEX) shows a promising long-term outlook. With a high Resilience score, indicating its ability to weather economic uncertainties and market fluctuations, HKEX is well-positioned to navigate challenging times. Additionally, the Growth score highlights the company’s potential for expansion and development in the future, showcasing a positive trajectory for investors.
Furthermore, HKEX‘s respectable Dividend score signifies a solid track record of distributing dividends to shareholders, enhancing its attractiveness for income-focused investors. Combined with a moderate Momentum score, suggesting a steady performance trend, HKEX presents itself as a compelling investment opportunity in the stock market. Overall, HKEX‘s unique position as the owner and operator of key exchanges in Hong Kong reinforces its significance in the financial landscape.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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