| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 32.07 | -58 |
| Intrinsic value (DCF) | 15.87 | -79 |
| Graham-Dodd Method | 7.84 | -90 |
| Graham Formula | 7.77 | -90 |
Zhe Jiang Headman Machinery Co., Ltd. is a prominent Chinese manufacturer specializing in computer numerical control (CNC) machine tools, serving critical industrial sectors since its establishment in 1993. Headquartered in Taizhou, China, a key hub for industrial manufacturing, the company produces precision machinery essential for automobile manufacturing, construction machinery, general equipment, and the military industry. As a player in the Industrials sector, specifically Industrial Machinery, Headman Machinery's products form the backbone of modern manufacturing processes, enabling automation, precision, and efficiency for its clients. The company's listing on the Shanghai Stock Exchange's STAR Market underscores its technological focus and growth trajectory within China's advanced manufacturing landscape. Operating in a strategically vital industry, Headman Machinery contributes to the supply chain for major end-markets, positioning it at the intersection of industrial upgrading and technological innovation in China. This overview highlights Headman Machinery's role as a specialized CNC equipment provider driving manufacturing capabilities forward.
Zhe Jiang Headman Machinery presents a mixed investment profile characterized by its niche positioning in China's CNC machinery market alongside moderate financial metrics. The company maintains a market capitalization of approximately CNY 14.1 billion, reflecting investor recognition of its specialized industrial role. However, with a beta of 1.08, the stock demonstrates slightly higher volatility than the broader market. Financial performance shows revenue of CNY 765 million and net income of CNY 25.8 million, translating to a diluted EPS of CNY 0.34, indicating relatively thin profit margins. A positive signal is the dividend per share of CNY 0.42857, which exceeds the EPS, suggesting a potentially unsustainable payout ratio or the utilization of retained earnings. The company's operating cash flow of CNY 68.6 million is positive, but significant capital expenditures (CNY -70.9 million) nearly offset this, indicating heavy investment needs. The balance sheet shows a comfortable cash position (CNY 190 million) relative to total debt (CNY 180 million). Key investment considerations include its exposure to cyclical industrial sectors, competitive pressures, and the sustainability of its dividend policy amid substantial capex requirements.
Zhe Jiang Headman Machinery operates in the highly competitive Chinese CNC machine tool industry, where its competitive positioning is defined by its long-standing presence since 1993 and specialization in machinery for automotive, construction, and military applications. The company's competitive advantage appears rooted in its established market relationships and focus on specific industrial verticals rather than technological leadership or scale. Compared to larger domestic players, Headman's revenue base of CNY 765 million positions it as a mid-tier competitor, likely competing on cost and customer service within its regional stronghold of Zhejiang province. The industry is characterized by intense competition from both state-owned enterprises with greater resources and private firms with aggressive pricing strategies. Headman's moderate profitability (net margin of approximately 3.4%) suggests it operates in a competitive segment with pricing pressures. The company's capital expenditure nearly matching its operating cash flow indicates it must continually invest to maintain technological relevance, a challenge for mid-sized players against better-funded competitors. Its beta of 1.08 reflects market perception of its sensitivity to industrial cycles, a risk factor in competitive positioning. Without clear technological differentiation or dominant market share, Headman's strategy likely relies on deepening relationships in its core sectors and optimizing operational efficiency to maintain its position against both domestic giants and emerging specialized competitors.