Is Xinyi Energy Holdings Limited (HKG:3868) Expensive For A Reason? A Look At Its Intrinsic Value

Simply Wall St.

Yesterday

AdvertisementKey Insights Xinyi Energy Holdings' estimated fair value is HK$0.96 based on Dividend Discount Model Current share price of HK$1.27 suggests Xinyi Energy Holdings is potentially 32% ...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Most Discussed

{"basename":"","ssrTDKData":{"titleTemplate":"%s - Tiger Brokers","title":"Tiger Brokers | Global Stocks, Options & Futures Trading App","description":"Tiger Brokers, one-stop investment in US stocks, SGX stocks, HK stocks, A-shares & other global assets. One of the best stock trading platforms in Singapore.","keywords":"tiger brokers,tiger trade,tiger brokers singapore,broker online,stock trading in singapore,share trading singapore,brokerage firm singapore,trading app,stock broker singapore,stock trading platforms,trading account","social":{"ogDescription":"Tiger Brokers, one-stop investment in US stocks, SGX stocks, HK stocks, A-shares & other global assets. One of the best stock trading platforms in Singapore.","ogImage":"https://c1.itigergrowtha.com/portal5/static/media/og-logo.be62fbe1.png","ogUrl":"https://www.itiger.com/news/2610604859"},"companyName":"Tiger Brokers"},"pageData":{"isMobile":false,"isTiger":false,"isTTM":true,"region":"SGP","license":"TBSG","edition":"fundamental"},"isCrawlerRequest":true,"__swrFallback__":{"@#url:\"https://stock-news.skytigris.cn/v3/news\",params:#id:\"2610604859\",edition:\"fundamental\",auth_exemption:1,,,undefined,":{"share":"https://ttm.financial/m/news/2610604859?lang=en_US&edition=fundamental","thumbnail":"https://images.simplywall.st/asset/industry/9621063-choice2-main-header/1585186854995","is_english":true,"pubTime":"2026-02-11 07:11","share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","id":"2610604859","market":"sg","top_or_hot":-1,"title":"Is Xinyi Energy Holdings Limited (HKG:3868) Expensive For A Reason? A Look At Its Intrinsic Value","media":"Simply Wall St.","content":"<div>\n<p>AdvertisementKey Insights Xinyi Energy Holdings' estimated fair value is HK$0.96 based on Dividend Discount Model   Current share price of HK$1.27 suggests Xinyi Energy Holdings is potentially 32% ...</p>\n\n<a href=\"https://simplywall.st/stocks/hk/utilities/hkg-3868/xinyi-energy-holdings-shares/news/is-xinyi-energy-holdings-limited-hkg3868-expensive-for-a-rea\">Source Link</a>\n\n</div>\n","source":"simplywall_highlight","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Is Xinyi Energy Holdings Limited (HKG:3868) Expensive For A Reason? A Look At Its Intrinsic Value</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nIs Xinyi Energy Holdings Limited (HKG:3868) Expensive For A Reason? A Look At Its Intrinsic Value\n</h2>\n\n<h4 class=\"meta\">\n\n\n2026-02-11 07:11 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://simplywall.st/stocks/hk/utilities/hkg-3868/xinyi-energy-holdings-shares/news/is-xinyi-energy-holdings-limited-hkg3868-expensive-for-a-rea><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>AdvertisementKey Insights Xinyi Energy Holdings' estimated fair value is HK$0.96 based on Dividend Discount Model   Current share price of HK$1.27 suggests Xinyi Energy Holdings is potentially 32% ...</p>\n\n<a href=\"https://simplywall.st/stocks/hk/utilities/hkg-3868/xinyi-energy-holdings-shares/news/is-xinyi-energy-holdings-limited-hkg3868-expensive-for-a-rea\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"DCF","symbol_name":"Dreyfus Alcentra Global Credit Income 2024 Target Term Fund, Inc","start_time":0,"source_url":"https://simplywall.st/stocks/hk/utilities/hkg-3868/xinyi-energy-holdings-shares/news/is-xinyi-energy-holdings-limited-hkg3868-expensive-for-a-rea","article_id":"2610604859","we_media_id":null,"thumbnails":["https://images.simplywall.st/asset/industry/9621063-choice2-main-header/1585186854995"],"rights":{"source":"simplywall_highlight","url":"https://simplywall.st/stocks/hk/utilities/hkg-3868/xinyi-energy-holdings-shares/news/is-xinyi-energy-holdings-limited-hkg3868-expensive-for-a-rea","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=2610604859","pubTimestamp":1770765085,"columns":[],"sourceInfo":{"source_id":"simplywall_highlight","name":"Simply Wall St."},"weMediaInfo":null,"summary":"Key Insights Xinyi Energy Holdings' estimated fair value is HK$0.96 based on Dividend Discount Model Current share...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"DCF":"Dreyfus Alcentra Global Credit Income 2024 Target Term Fund, Inc","03868":"信义能源","BK1583":"高瓴概念","BK1154":"新能源发电业者","BK1594":"碳中和概念股","BK1554":"光伏太阳能股"},"translate_title":"信义能源控股有限公司（HKG：3868）贵是有原因的吗？看看它的内在价值","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"03868":1.5,"DCF":1},"content_text":"AdvertisementKey Insights Xinyi Energy Holdings' estimated fair value is HK$0.96 based on Dividend Discount Model   Current share price of HK$1.27 suggests Xinyi Energy Holdings is potentially 32% overvalued    The CN¥1.27 analyst price target for 3868 is 32% more than our estimate of fair value   Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Xinyi Energy Holdings Limited (HKG:3868) as an investment opportunity  by taking the expected future cash flows and discounting them to their present value.  This will be done using the Discounted Cash Flow (DCF) model.  Believe it or not, it's not too difficult to follow, as you'll see from our example!  Remember though, that there are many ways to estimate a company's value, and a DCF is just one method.  If you still have some burning questions about this type of valuation, take a look at the Simply Wall St analysis model. Trump has pledged to \"unleash\" American oil and gas and these 15 US stocks have developments that are poised to benefit. Crunching The Numbers   As Xinyi Energy Holdings operates in the renewable energy sector, we need to calculate the intrinsic value slightly differently.  Instead of using free cash flows, which are hard to estimate and often not reported by analysts in this industry, dividends per share (DPS) payments are used.  Unless a company pays out the majority of its FCF as a dividend, this method will typically underestimate the value of the stock.  The 'Gordon Growth Model' is used, which simply assumes that dividend payments will continue to increase at a sustainable growth rate forever.  The dividend is expected to grow at an annual growth rate equal to the 5-year average of the 10-year government bond yield of 2.9%. We then discount this figure to today's value at a cost of equity of 9.0%.  Relative to the current share price of HK$1.3, the company appears   potentially overvalued    at the time of writing.   Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind. Value Per Share = Expected Dividend Per Share / (Discount Rate - Perpetual Growth Rate)= CN¥0.06 / (9.0% – 2.9%)= HK$1.0SEHK:3868 Discounted Cash Flow February 10th 2026  The Assumptions  We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows.  If you don't agree with these result, have a go at the calculation yourself and play with the assumptions.  The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance.  Given that we are looking at Xinyi Energy Holdings as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt.  In this calculation we've used 9.0%, which is based on a levered beta of 1.177. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.   Check out our latest analysis for Xinyi Energy Holdings SWOT Analysis for Xinyi Energy HoldingsStrength Earnings growth over the past year exceeded the industry. Debt is well covered by earnings. Balance sheet summary for 3868. Weakness Dividend is low compared to the top 25% of dividend payers in the Renewable Energy market. Expensive based on P/E ratio and estimated fair value. Opportunity Annual earnings are forecast to grow for the next 4 years. ThreatDebt is not well covered by operating cash flow. Paying a dividend but company has no free cash flows.  Annual earnings are forecast to grow slower than the Hong Kong market. Is 3868 well equipped to handle threats?  Next Steps:  Valuation is only one side of the coin in terms of building your investment thesis, and it  shouldn't be the only metric you look at when researching a company.  It's not possible to obtain a foolproof valuation with a DCF model.  Preferably you'd apply different cases and assumptions and see how they would impact the company's valuation.  For example, changes in the company's cost of equity or the risk free rate can significantly impact the valuation.   Why is the intrinsic value lower than the current share price?   For Xinyi Energy Holdings, we've compiled three  relevant  items  you should further examine:   Risks: For example, we've discovered 2 warning signs for Xinyi Energy Holdings (1 is potentially serious!) that you should be aware of before investing here.  Future Earnings: How does 3868's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing!   PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the SEHK every day. If you want to find the calculation for other stocks just search here.New: AI Stock Screener & AlertsOur new AI Stock Screener scans the market every day to uncover opportunities.• Dividend Powerhouses (3%+ Yield)• Undervalued Small Caps with Insider Buying• High growth Tech and AI CompaniesOr build your own from over 50 metrics.Explore Now for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0,"need_auth":false,"code":"91000000","status":"200"}}}