Angang Steel Company Limited : The trend should continue

04/08/2021 | 02:56am EDT

Jordan Dufee

long trade Live

Entry price : 4.48HKD | Target : 6HKD | Stop-loss : 3.75HKD | Potential : 33.93%

Shares in Angang Steel Company Limited have recently benefitted from a regain of interest by market participants. The technical chart pattern suggests a continuation of the upward movement. Investors have an opportunity to buy the stock and target the HKD 6.

Summary

• The company has strong fundamentals. More than 70% of listed companies have a lower mix of growth, profitability, debt and visibility criteria.
• In a short-term perspective, the company has interesting fundamentals.

Strengths

• The company shows low valuation levels, with an enterprise value at 0.45 times its sales.
• Its low valuation, with P/E ratio at 10.36 and 9.47 for the ongoing fiscal year and 2022 respectively, makes the stock pretty attractive with regard to earnings multiples.
• The company is one of the best yield companies with high dividend expectations.
• Upward revisions of sales forecast reflect a renewed optimism among the analysts covering the stock.
• Over the past year, analysts have regularly revised upwards their sales forecast for the company.
• Over the last seven days, analysts have been revising upwards their EPS estimates for the company.
• For the last 4 months, the company has been enjoying highly positive EPS revisions, which were frequently and significantly raised.
• For the last twelve months, analysts have been gradually revising upwards their EPS forecast for the upcoming fiscal year.
• Analysts covering this company mostly recommend stock overweighting or purchase.
• The stock is in a well-established, long-term rising trend above the technical support level at 2.99 HKD

Weaknesses

• According to Standard & Poor's' forecast, revenue growth prospects are expected to be very low for the next fiscal years.
• Prospects from analysts covering the stock are not consistent. Such dispersed sales estimates confirm the poor visibility into the group's activity.

Subsector Other Steel

1st jan. Capitalization (M$) Investor Rating ANGANG STEEL COMPANY LIMITE.. 51.90% 6 548 ARCELORMITTAL 29.00% 30 571 NUCOR CORPORATION 51.40% 23 982 POSCO 21.14% 22 287 NIPPON STEEL CORPORATION 39.34% 15 573 TATA STEEL LIMITED 32.29% 13 600 STEEL DYNAMICS, INC. 38.84% 10 947 COMPANHIA SIDERÚRGICA NACIO.. 37.77% 10 637 MAGNITOGORSK IRON & STEEL W.. 16.01% 9 340 CLEVELAND-CLIFFS INC. 20.47% 8 896 GERDAU S.A. 27.69% 8 767

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