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China Yuchai: Pinning Hopes On Positive Surprises After Earnings Disappointment

Summary

  • China Yuchai's 2H 2020 earnings were a disappointment, and the company's FY 2021 earnings outlook seems too optimistic.
  • The market values China Yuchai at 6.6 times consensus forward FY 2021 P/E, and it boasts a consensus dividend of 5.0% for FY 2021.
  • Special dividends and a secondary listing could be positive surprises and potential re-rating catalysts for the stock.
  • Looking for more investing ideas like this one? Get them exclusively at Asia Value & Moat Stocks. Learn More »

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Elevator Pitch

I retain my Neutral rating for China Yuchai International Limited (NYSE:CYD).

China Yuchai's share price has declined by -6% from $17.04 as of December 4, 2020, to $16.00 as of April 7, 2021, since I published my

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This article was written by

The Value Pendulum profile picture
11.26K Followers

The Value Pendulum is an Asian equity market specialist with over a decade of experience on both the buy and sell sides.

He is the author of the investing group Asia Value & Moat Stocks, providing ideas for value investors seeking investment opportunities listed in Asia, with a particular focus on the Hong Kong market. He hunts for deep value balance sheet bargains and wide moat stocks and provides a range of watch lists with monthly updates within his investing group.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (2)

C
Good report. The problem I have with CYD is that management sucks to put it bluntly. I either need to get it dirt cheap (and this is not cheap) or pass.

I'll pass but a good report.
g23riel profile picture
Great report, very fair to the market conditions and company outlook. Sometimes I wish the companies read your reports, they would do better.
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