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The numbers tell that Cw Group Holdings Ltd is a solid growth stock

31/03/2015 • About Cw Group Holdings Ltd ($1322) • By InTwits

Cw Group Holdings Ltd is an attractive growth stock in Hand/Machine Tools industry. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.

Growth story


Cw Group Holdings Ltd showed growth in the last financial year. The company's revenue surged on 69.5% in FY2014. The growth also happened in EBITDA of 60.8% for the same period.

In the last 3 years the company showed fast revenue growth of 30.0% from 2011 to 2014 annualy. EBITDA surged on 21.1% from 2011 to 2014 annualy.

Cw Group Holdings Ltd ($1322) financials for the last 5 years

mln.  2010 2011 2012 2013 2014
Revenue4697547779761,655
Revenue growth, %60.5%3.1%25.7%69.5%
Gross margin, %30.9%23.8%27.4%19.7%18.0%
SG&A, %11.8%4.53%3.22%
EBITDA122142150157252
EBITDA growth, %15.9%5.8%4.3%60.8%
EBITDA margin, %26.1%18.8%19.3%16.0%15.2%
Net Income276855130304
Net Income margin, % 5.72%9.03%7.10%13.3%18.4%
 
CAPEX10131636
CAPEX/Revenue, %2.07%1.67%2.09%0.358%0.342%
Debt135121162299503
Cash104321282881
Net Debt/EBITDA0.2x0.6x0.2x1.7x1.7x
 
ROIC, %34.2%34.8%21.4%16.9%19.4%
ROE, %19.6%37.8%14.0%20.6%36.8%

Profitability and return on investment


EBITDA growth was partly attributed to margin expansion. In the longer period the company showed big decline in EBITDA margin of 3.60 pp from 18.8% in 2011 to 15.2% in 2014.

Cw Group Holdings Ltd shows attractive ROIC at 19.4% for the last 12 months which assumes stable development model. Three years ago it was considerably higher at 34.8%. It's average ROIC for the last three years was 19.2%.

Net Income margin surged on 5.10 pp from 13.3% to 18.4% in 2014. In the last 3 years the company showed fast Net Income margin growth of 9.40 pp from 9% in 2011 to 18.4% in 2014.

Cw Group Holdings Ltd operates at ROE of 36.8%. For the last three years the average ROE was 23.8%.

Capital expenditures (CAPEX)


In FY2014 the company had CAPEX/Revenue of 0.342%. Cw Group Holdings Ltd showed big decline in CAPEX/Revenue of 1.33 pp from 1.67% in 2011 to 0.342% in 2014. It's average CAPEX/Revenue for the last three years was 0.931%.

Leverage (Debt)


Having such a fast growth profile Cw Group Holdings Ltd keeps medium debt level at 1.7x Net Debt/EBITDA. If we look for the longer period the company showed fast leverage growth of 1.06x from 0.62x in 2011 to 1.68x in 2014.

Peers in Hand/Machine Tools


Below we provide Cw Group Holdings Ltd benchmarking against other companies in Hand/Machine Tools industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.

Top companies by Revenue growth, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top
Techtronic Industries Co Ltd ($669)8.0%5.1%11.6%10.5%
Chongqing Machinery & Electric Co Ltd ($2722)18.7%-15.5%8.9%-2.2%
 
Median (2 companies)13.3%-5.2%10.3%4.2%
Cw Group Holdings Ltd ($1322)60.5%3.1%25.7%69.5%


Top companies by Gross margin, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top
Techtronic Industries Co Ltd ($669)32.2%32.6%33.5%34.2%35.2%
Chongqing Machinery & Electric Co Ltd ($2722)19.0%18.6%11.6%11.2%11.2%
 
Median (2 companies)25.6%25.6%22.5%22.7%23.2%
Cw Group Holdings Ltd ($1322)30.9%23.8%27.4%19.7%18.0%


Top companies by EBITDA margin, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top
Techtronic Industries Co Ltd ($669)9.2%9.3%10.2%10.0%10.6%
Chongqing Machinery & Electric Co Ltd ($2722)10.1%10.1%4.1%4.2%4.2%
 
Median (2 companies)9.7%9.7%7.1%7.1%7.4%
Cw Group Holdings Ltd ($1322)26.1%18.8%19.3%16.0%15.2%


Top companies by CAPEX/Revenue, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top
Chongqing Machinery & Electric Co Ltd ($2722)2.4%4.1%5.0%6.0%7.7%
Techtronic Industries Co Ltd ($669)2.7%2.6%2.7%2.4%3.0%
 
Median (2 companies)2.6%3.3%3.8%4.2%5.4%
Cw Group Holdings Ltd ($1322)2.1%1.7%2.1%0.4%0.3%


Top companies by ROIC, %

 FY2010 FY2011 FY2012 FY2013 FY2014
Top
Techtronic Industries Co Ltd ($669)8.4%8.8%10.3%10.9%12.9%
Chongqing Machinery & Electric Co Ltd ($2722)12.6%12.4%2.1%2.4%2.0%
 
Median (2 companies)10.5%10.6%6.2%6.7%7.5%
Cw Group Holdings Ltd ($1322)34.2%34.8%21.4%16.9%19.4%


Top companies by Net Debt / EBITDA

 FY2010 FY2011 FY2012 FY2013 FY2014
Top
Chongqing Machinery & Electric Co Ltd ($2722)-0.6x-0.1x0.4x1.7x3.2x
Techtronic Industries Co Ltd ($669)2.8x2.4x1.2x0.6x0.5x
 
Median (2 companies)1.1x1.1x0.8x1.2x1.9x
Cw Group Holdings Ltd ($1322)0.2x0.6x0.2x1.7x1.7x


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