Eye on AAC Technologies Holdings Inc as a growth stock: its revenue grew 23.2% and EBITDA 22.0% annually over the last three years
30/03/2016 • About AAC Technologies Holdings Inc (
$2018) • By InTwits
Pay attention to AAC Technologies Holdings Inc as a growth stock. Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
AAC Technologies Holdings Inc showed growth in the last financial year. AAC Technologies Holdings Inc's revenue surged on 32.2% in FY2015. At the same time AAC Technologies Holdings Inc well managed its profitability and also showed EBITDA growth of 31.7% for the same period.
In the longer period the company showed fast revenue growth of 23.2% from 2012 to 2015 annualy. EBITDA surged on 22.0% from 2012 to 2015 annualy.
AAC Technologies Holdings Inc ($2018) financials for the last 5 years
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 |
|---|
| Revenue | 4,060 | 6,283 | 8,096 | 8,879 | 11,739 |
|---|
| Revenue growth, % | | 54.8% | 28.9% | 9.7% | 32.2% |
|---|
| Gross margin, % | 44.0% | 44.2% | 42.7% | 41.4% | 41.5% |
|---|
| SG&A, % | 7.15% | 7.38% | 6.55% | 6.04% | 6.84% |
|---|
| EBITDA | 1,430 | 2,249 | 2,900 | 3,101 | 4,083 |
|---|
| EBITDA growth, % | | 57.2% | 29.0% | 6.9% | 31.7% |
|---|
| EBITDA margin, % | 35.2% | 35.8% | 35.8% | 34.9% | 34.8% |
|---|
| Net Income | 1,036 | 1,763 | 2,578 | 2,318 | 3,107 |
|---|
| Net Income margin, % | 25.5% | 28.1% | 31.8% | 26.1% | 26.5% |
|---|
| |
| CAPEX | 1,053 | 1,176 | 707 | 1,739 | 2,164 |
|---|
| CAPEX/Revenue, % | 25.9% | 18.7% | 8.73% | 19.6% | 18.4% |
|---|
| Debt | 891 | 1,035 | 923 | 1,429 | 1,808 |
|---|
| Cash | 1,374 | 1,314 | 2,354 | 1,603 | 2,224 |
|---|
| Net Debt/EBITDA | -0.3x | -0.1x | -0.5x | -0.1x | -0.1x |
|---|
| |
| ROIC, % | 22.3% | 29.1% | 30.0% | 26.0% | 27.8% |
|---|
| ROE, % | 23.2% | 32.6% | 36.9% | 27.2% | 30.4% |
|---|
Profitability and return on investment
EBITDA growth was partly attributed to margin expansion. In the longer period AAC Technologies Holdings Inc showed small EBITDA margin decline of 1 pp from 35.8% in 2012 to 34.8% in 2015.
We call AAC Technologies Holdings Inc an attractive growth stock as together with the growth it delivers high ROIC at 27.8%. Three years ago it was a bit higher at 29.1%. It's average ROIC for the last three years was 27.9%.
Net Income margin increased slightly on 0.400 pp from 26.1% to 26.5% in 2015. If we look for the longer period Net Income margin decreased on 1.60 pp from 28.1% in 2012 to 26.5% in 2015.
AAC Technologies Holdings Inc operates at ROE of 30.4%. For the last three years the average ROE was 31.5%.
Capital expenditures (CAPEX)
To fuel this fast growth the company had to invest in CAPEX.In FY2015 AAC Technologies Holdings Inc had CAPEX/Revenue of 18.4%. The company showed small CAPEX/Revenue decline of 0.274 pp from 18.7% in 2012 to 18.4% in 2015. It's average level of CAPEX/Revenue for the last three years was 15.6%.
Leverage (Debt)
The company has negative net debt at -0.1x Net Debt/EBITDA - at the same time with high growth. In the longer period the company showed fast leverage growth of 0.02x from -0.12x in 2012 to -0.10x in 2015.
Management team
Pan Zhengmin "Benjamin" is a CEO of AAC Technologies Holdings Inc.
Peers in Electronics
Below we provide AAC Technologies Holdings Inc benchmarking against other companies in Electronics 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, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| China Netcom Technology Holdings Ltd ($8071) | -22.0% | 11.6% | -23.0% | 104.1% | |
| Technovator International Ltd ($1206) | | 27.4% | 34.1% | 35.9% | 19.0% |
| Tongda Group Holdings Ltd ($698) | | 8.3% | 6.4% | 32.1% | 26.8% |
| Advanced Card Systems Holdings Ltd ($8210) | | 36.9% | 20.8% | 26.7% | -4.8% |
| Alltronics Holdings Ltd ($833) | 33.9% | -1.6% | -1.6% | 23.4% | |
| |
|---|
| Median (49 companies) | 6.9% | -1.6% | 3.1% | 3.8% | 0.4% |
|---|
| AAC Technologies Holdings Inc ($2018) | | 54.8% | 28.9% | 9.7% | 32.2% |
Top companies by Gross margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Advanced Card Systems Holdings Ltd ($8210) | 51.4% | 54.0% | 58.1% | 49.5% | 49.6% |
| TeleEye Holdings Ltd ($8051) | 51.6% | 44.0% | 42.1% | 38.5% | 37.0% |
| Wasion Group Holdings Ltd ($3393) | 30.3% | 32.8% | 35.1% | 34.2% | 30.2% |
| Datronix Holdings Ltd ($889) | 41.3% | 32.9% | 32.0% | 34.1% | 34.6% |
| Hi Sun Technology China Ltd ($818) | 20.8% | 28.1% | 37.4% | 33.3% | 34.7% |
| |
|---|
| Median (47 companies) | 13.5% | 13.6% | 13.7% | 13.8% | 16.8% |
|---|
| AAC Technologies Holdings Inc ($2018) | 44.0% | 44.2% | 42.7% | 41.4% | 41.5% |
Top companies by EBITDA margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Nanjing Sample Technology Co Ltd ($1708) | 31.5% | 26.8% | 21.1% | 22.3% | 15.7% |
| Wasion Group Holdings Ltd ($3393) | 18.9% | 18.8% | 21.2% | 22.0% | 19.3% |
| Technovator International Ltd ($1206) | 19.2% | 19.0% | 19.0% | 20.8% | 18.0% |
| Trigiant Group Ltd ($1300) | 17.0% | 17.6% | 18.2% | 18.5% | 16.2% |
| Tongda Group Holdings Ltd ($698) | 15.3% | 17.1% | 16.8% | 18.4% | 18.9% |
| |
|---|
| Median (49 companies) | 8.8% | 5.7% | 4.4% | 4.0% | 7.4% |
|---|
| AAC Technologies Holdings Inc ($2018) | 35.2% | 35.8% | 35.8% | 34.9% | 34.8% |
Top companies by CAPEX/Revenue, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| AKM Industrial Co Ltd ($1639) | 7.4% | 5.0% | 17.4% | 25.2% | 18.0% |
| Irico Group Electronics Co Ltd ($438) | 92.0% | 39.9% | 30.4% | 17.4% | 25.8% |
| Tech Pro Technology Development Ltd ($3823) | 32.8% | 7.6% | 13.1% | 15.4% | |
| Nanjing Sample Technology Co Ltd ($1708) | 3.7% | 23.9% | 15.5% | 12.0% | 2.7% |
| Tongda Group Holdings Ltd ($698) | 5.7% | 7.8% | 4.9% | 11.4% | 16.2% |
| |
|---|
| Median (49 companies) | 3.2% | 3.7% | 2.9% | 3.3% | 2.9% |
|---|
| AAC Technologies Holdings Inc ($2018) | 25.9% | 18.7% | 8.7% | 19.6% | 18.4% |
Top companies by ROIC, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Cowell e Holdings Inc ($1415) | | 12.5% | 27.1% | 24.4% | 25.8% |
| Advanced Card Systems Holdings Ltd ($8210) | 15.5% | 26.7% | 24.7% | 20.2% | 9.7% |
| Alltronics Holdings Ltd ($833) | 19.3% | 13.1% | 15.2% | 19.8% | |
| Tongda Group Holdings Ltd ($698) | 14.3% | 15.2% | 13.5% | 16.5% | 16.3% |
| Trigiant Group Ltd ($1300) | 17.9% | 17.8% | 18.3% | 15.2% | 11.2% |
| |
|---|
| Median (49 companies) | 5.4% | 4.1% | 3.5% | 2.9% | 3.2% |
|---|
| AAC Technologies Holdings Inc ($2018) | 22.3% | 29.1% | 30.0% | 26.0% | 27.8% |
Top companies by Net Debt / EBITDA
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| National Electronic Hldgs ($213) | 43.0x | 16.3x | 30.2x | 84.8x | 19.9x |
| Sino-Tech International Holdings Ltd ($724) | | | 15.7x | 24.7x | |
| Eyang Holdings Group Co Ltd ($117) | 4.2x | 3.3x | 3.7x | 17.9x | |
| SAS Dragon Hldg Ltd ($1184) | 2.8x | 7.1x | 2.0x | 6.4x | |
| Willas-Array Electronics Holdings Ltd ($854) | 2.8x | 2.2x | 2.6x | 5.7x | 5.4x |
| |
|---|
| Median (35 companies) | 0.8x | 1.1x | 1.1x | 1.2x | 0.5x |
|---|
| AAC Technologies Holdings Inc ($2018) | -0.3x | -0.1x | -0.5x | -0.1x | -0.1x |
